Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-19
BONDS DEPRESSED
ON SELLING MOVE
Decline in U. S. Obligations
Reflected in Drop of
Foreign List.
BY F. II. RICHARDSON.
Special Dispatch to The Star.

Special Dispatch to The Star.
NEW YORK, October 1s.-Bond
prices ranged lower again today.
Lack of improvement in the Sino-
Japanese situation and the default of
Brazil on all but three of the federal
governments obligations served to de-
press foreign descriptions from l to 8
points. At home the absence of the
expected Washington announcement on
rail freight rates and the protection of
rail securities and predictions of an
other advance in the New York Fed
eral Reserve Bank rediscount rate
caused heaviness in virtually all do
mestic descriptions.
United States Governments. steady at
the opening, later dropped to new lows
on renewed volume of offerings.
With the prospect of a 4 to Az per
cent redlscount rate in mind, Wall
street was inclined to mark all Treas
ury offerings down to to Az per
cent yield basis. The new IS dropped
below 80 for the first time. There
were losses of 4 to l point in other
active Treasures and Liberties. Wall
Street calculated that the $50,000.000
OF 9l-day bills announced for issue by
Secretary Mellon would be bid for at
around 3.75 to per cent.
The market for United States Gov
eminent bonds is also suffering just
now from the entire absence of any
buying by foreign governments. Ordi-
harlly foreign governments owing
money to the Treasury at Washington
buy United States Government bonds,
which are acceptable at face value,
Whenever they go below par. But just
now, with moratorium on intergov-
ernmental debts, there is no such
buying
The market was firm at the opening
Week end developments in the for
eign political situation were calculated
to encourage investors in foreign issues.
Domestic descriptions were still inclin-
ing upward. the rails looking toward
governmental relief as a reason for
hgher prices and industrials ranging
back slowly after being much oversold.
Missouri Pacific 5 2s and Frisco prior
lien A As in the speculative group and
Atchison General as in the high grade
group were all substantially higher.
Brooklyn Manhattan Transit SIS. Texas
Corporation SIS and other industrials
were point or more better. Utilities
like American Telephone s. IS were well
supported.
Foreign bonds were irregular. Ger
man government 81 IS and Is, British
5l2s and Italian issues all were firm.
OdpdIltSC UUlIuS were vi Oh
the uncertainty still surrounding the
Sino-Japanese situation. South Amer
leans were fiat on Brazils action in
defaulting all but three bond issues.
High-grade corporation issues were
heavy. chiefly because of the possibility
of higher money rates. Atchison Cen
eral As dropped fractionally to a new
low. Baltimore e. Ohio first As. West
Shore As, Norfolk e. Western As and
similar seasoned rail bonds were all
lower. American Telephone SIS. New
York Telephone Az. Western Union SIS
and other high-grade utility bonds lost
opening gains.
The selling in the speculative rails
and industrials was not heavy. but it
was the more effective because of the
thinness of the market Those who
bought junior rails expecting a decision
on freight rates by the Interstate Com
merce Commission on Saturday hur-
riedly Invested themselves of their hold
ings, Erie SIS. Nickel Plate AIS, Frisco
AIS, st. Paul SIS. Chicago & Northwest
ern 434s ana other volatile carrier de-
scriptions that advanced strongly last
week were off to points. Industrials
like Dodge Bros. IS, Warner Bros. Pic
lures 6s. Texas Corporation SIS and Sin
clair rs were heavy as well.