Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-03-05
NAVAL PACT SEEN
AS HELP TO TRADE
Wall Street Expects Franco.
italian Agreement viii
Stimulate Industry.
BY CHARLES F. SPEARE.


NEW YORK, March 5.-As a rule
the rank and file in Wall Street do not
get greatly excited over foreign political
developments, but considerable atten-
ton has been given this week to the
naval pact between Italy and France,
and today to the news that truce has
been reached in India between the In
dian Nationalist party and the British
government. 1t is realized even here
that the latter means a great deal to
British trade. An expansion in the
trade of Great Britain, in turn, helps
the foreign commerce of this country.
Wall Streets rank and file are stiIl
provincial in their views and generally
pass by notable announcements that
come from the capitals of Europe as If
they did not concern the welfare OF
the United States. However, the gen.
orally better tone in European politics.
including the increasing strength OF
the government party in Germany since
last December, is now slowly being re-
flected in the prices of European dollar
bonds. Recently there has been q
broader and a stronger market in some
of these issues than in the loans OF
American corporations.
Gain in German Bonds.
It is estimated that the appreciation
in German government, municipal and
corporation bonds, since they touched
their low quotations in January, has
amounted to nearly $100,000,000, OF
about 8 per cent on the total German
loans listed in New York. The So
called Young loan is up 10 points, the
Dawes loan points, Prussian issues
from 10 to IL points, those OF the Ger
man mortgage banks, of which about
$125 100000 are outstanding, from AZ
to Is points and various public utility
and industrial German loans an average
of over 10 points. 1t is in this group
that the greatest response has SO far
been made to the betterment IN po-
litical sentiment abroad
At the same time the European loan:
that carry the highest credit rating;
have been steadily advancing. Nearly
all are today quoted at their best fig-
ures. This includes French government
municipal and railroad issues, Belgian
government loans and the various
Dutch, Swiss, Danish, Swedish and Nor
wegian national and municipal loans
Japanese, Austrian and Greek loans
have also gained additional ground ir
recent weeks.
A list has just been published Of 2;
dollar loans whose present price i
greatly above the initial offering figure
In connection with this, it is shown
that bonds originally amounting Il
S425, 000, 900 that have already antici'
pated their maturity or are in the
process Of being called before maturity
show an increment in the principle ovel
the purchase price of nearly $4,000, 900
or the equivalent Of nearly 10A pei
cent on the investment This list j:
made UP chiefly of French, Swiss, Bel.
gian, Scandinavian and one or two high
coupon South American bonds.
Italian Bond Issue.
It does not, however, tell the COM
plete story of the retirement from the
American market of foreign dollar OBJ
legations, for the amount purchased py
nationals has been nearly the equiva-
lent of that on which maturity has beer
anticipated, or others retired in the
natural operation of substantial annua
sinking funds.
Bankers here who have made the i'm
portant European loans in the past 10
years are deeply interested in the re-
ports that France is about to enter into
arrangements with Italy for a bond
issue said to be 100000, 900. 1t Is OBJ
vious that France will not undertake
this alone, and that she will have the
assistance of those European bankers
who have in the past been members OF
a broad international group in loans OF
this sort. It is also quite possible that
there may be a substantial American
participation, although within a COM
paratively few weeks New York bankers
have denied that they were planning to
make any new commitment to Italy.
In 1925 an American group loaned Italy
500 ,000, 900, offering per cent bond
at 941s. These bonds are quoted to-
day near 100. They have been as low
this year as 927s.
(Copyright, 1879