Evening star., 1931-12-06
Rail Bond Prices
Hit Record Lows
In Weeks Trading
Total Losses in Securities
Near $3.50, 400, 900.
Buying at Minimum.
Special Dispatch to The Star.

Special Dispatch to The Star.
NEW YORK, December 5.-The week
has seen the heaviest depreciation in
the value Of railroad bonds that has
occurred in any single week in the
history Of the New York Stock Ex-
change. On one day-Wednesdav-
Standard Statistics index of 20 rail-
road bonds declined points. This
represented a decline of S2l6,O0O, 900
IN the value of carrier obligations of
all classes listed on the exchange. In
the whole week the decline approx
imated 1856 100000.
Railroad bonds have now declined
in 20 consecutive market sessions. their
average loss being 127 points on the
Standard Statistics index. This rep-
resented in the three weeks a depre
clatlon in market value of 1890, 900 600
trHn the $10,827,957, 800 par value of
iaE ponds hsted on the exchange.
Sales Volume Light.
Trading volume, however, did not
reach the proportions that it did in
late September and October. Prices
fell chiefly because there were no sup
porting bids in the market and it took
very lew sales to cause drops of 2 to
20 points.
All this sounds familiar, for the de-
cAne mas been in progress ever since
september, 1880. At that time railroad
issues stood at their highest average in
elght years Their peak average price
was 1899. Today their average price
Is under To-
The weeks selling was precipitated
by the receiverShips Of the Wabash and
the Ann Arbor roads. Since the earn
lngS OF such important carriers as the
New York Central, Illinois Central. st
Louls-San Francisco Rock Island and
otherS have also fallen off, there was an
lmmedlate outflow of wild rumors and
the railroad market fell abruptly.
some OF the stories were utterly
RIDICULOUS. And when New York Cen
trlal announced its application to issue
SlOO,OOO,OOO OF refunding S per cent
ponds to secure short term loans, the
rumor mongerS turned around and nut
out reports that all the railroad diff
hcultleS had been cleared up. This
was another eXaggeration, but it was
apparent that some seasoned railroad
issues had been OVersold, and the mar
Ket responded with a degree of re-
cOVery.
The New York State Committee m
near the week end adopted in nrin-
ciple the suggestion that 193I Earn
lngs be disregarded in CONSIDERING
whether rail bonds are legal for saw
mgs banks and trust funds. This was
considered constructive, but, since II
mad precedent in l92O-2l il was
anticipated some time ago and conse-
quently had little effect on the mar
ket' 1t was, however, evidence that
tne authorities have at last decided
that in the present situation actions
speak louder than words.
Other parts of the market u,ero
weak with the rails. "'ie
Foreign List.
The foreign market was sbor,,,,,
lower, especially the Germans oTir, ny
to lnS.stent reports that CcrnaI1S9 .
would desert the god standard ThiSs
was denied by the Rcichsbank but the
PrusSlan State Bank announced that
II could not pay its maturities ar the
Relchsoank this week. Young nIan
912S ana Dawes reparations Is dropned
to new record lows. '0ppe0
However, the Manchurian situation
Chinese issues recovered, The 0aooIll anu
Der l defaults in the South AnoorSaa,,
list We're ominouSly viewed hut h1t itdn tha
Latin American group took heart 't1t at
the gratifying result of the Arger+ino "o
elections and the probability thai .iCrlIo son1o
OF The enthusiastically thosn NJ 'ottIe the
City CT Montevidco and the sat- 'iIe ne
sac Paulo-would be made IN as soo, VI
as the central banks in South knorJon SUoii
permit the export of dollar oxahonno -riIler toa
During, the week new capital iSsISe istI1oc
amounte1 to $l7896,OOO. conn c6mnared ed 07S IS
Sl2,466,920 in the preceding WaeL t,a,i ca 10 70
S0o'44o'ooo IN the same week in 1S3o 5i1
Copyright, 1917