Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-01-28
bond PRICES SAG
IN SELLING MOVE
Government Issues Decline
Sharply as Offerings
Show Big Gain.
BY F. H. RICHARDSON.

special Dispatch to The Star.
NEW YORK, January 28.-Heavy
selling of United States Government
bonds featured today's bond market.
Liberty fourth 4K4s dropped over 8-32,
Treasury 3Ss Of 1913 lost 9-32 and
Treasury 33sS of 1947 were of over
1882. Other losses in Liberty and
Treasury issues ranged from 2-32 to
5-32.
While sales of United States Govern
Inent bonds on the stock exchange sell
dom assume large proportions, counter
dealers today reported very heavy SELL
ing orders. This was interpreted in
the Street to mean that banks which,
since December, have been buying Gov
eminent issues in large amounts, in
order to keep their reserves in as near
an equivalent to cash as possible, ex-
pect the flotation soon of O large
Government loan.
In addition, 1t was argued that since
the immediate necessity for extreme
liquidity in bank resources has passed,
banks were anxious to transfer into
higher yield securities. Current yield
on Government long-term bonds run
from 1877 to 1926 per cent per annum,
the lower yields obtaining in Liberty
31aS, first 4Ks and fourth 4As, which
are callable within the next two years.
Prime Issues Steady.
The general bond list was unsettled
to some degree by renewed liquidation
in stocks, though this had little eff
feet on prime issues, which continued
In demand at steady prices. This re-
sistance was best exemplified in Amer
lean Telephone SIPS, Atchison Gen.
eral As, Baltimore & Ohio IS, Boston
g. Maine IS, Brooklyn Manhattan Tran
sit IS, Canadian National Railways SIS,
Canadian Pacific AIS, Chesapeake
Corporation SIS, Chicago q Northwest
ern AIS, Columbia Gas q Electric IS,
General Motors Acceptance IS, Great
Northern Is, Inland Steel 41as, Ma
tional Dairy Products 5Hs, Pennsyl-
vania SIS, Southern Pacific AVS, Utah
Power & Light SIS and western
Union SIS.
Similarly the higher type of foreign
dollar bonds were strong. instances be-
German Preparations rs. Italy's rs
Kreuger's & Toll SIS, Oriental Develop
ment Co. IS. Queensland IS, Seine rs
and Yokohama 6s.
There was a tendency to liquidate
bonds not strictly of the highest invest
ment class. Nickel Plate AIS, which
declined sharply in the selling during
NOtcHIUcI anu OeCeInDeT, again cropped
below 80, though subsequently they
rallied. American & Foreign Power IS
were of point Atchison Convertible
412s on / II, and Denver & Rio Grande
Western SIS of point, with smaller
losses elsewhere. On the other hand, q
few speculative issues had gains, includ-
ing Richfleld Oil IS, Seaboard Airline
IS and Florida East Coast SIS.
New Financing.
The new capital market had only a
small amount Of municipals to dis
tribute today, but prospects for larger
offerings in the near future were in
creasing. The Iowa Senate approved a
500 ,000, 900 State road bond issue. The
possibility of the Treasury putting out
large issue in connection with the
veterans bonus plan, on top Of the re-
financing necessary to the maturing in
March of 81 100, 600, 900 of public debt,
also depressed the market Secretary
Melons statement that an attempt to
market $500, 10000 Of bonds would
Immediately depreciate materially the
price Of all United States bonds was
given much consideration.