Evening star., 1932-07-10
INVESTMENT BOND
RISE IS EXTENDED
Present Advance Began June
27-Gain in German
List Is Large.
Special Dispatch to The Star.


NEW YORK, Juf1 e-Encouraged by
the success ofsthe Lausanne Conference
on Reparations and War Debts, firmer
commodity markets and a clearer
political outlook generally, the invest
ment marked coursed steadily upward
during the past week.
The bond market now has advanced
continuously since June 81, and has
proved itself a tower of steadiness at
time when common and preferred
STOCKS have scraped new bottom levels.
On Friday when stocks touched new
lows Tor the bear market at one time
during the session, bonds continued
their advance without hesitation.
German Bond Improvement.
The first indication that the Iau-
same negotiators would reach a favor
able agreement caused sensational gains
IN the German dollar loans. This
movement was almost purely specu-
lative. as was evidenced by the subse-
quent prof1t-taking as the advance was
extended. But the general effect of
the Lausanne results was more perma
nently and constructively shown in the
nrm securities markets in Europe. nv a
worldwide steadying of commodity
markets and by return of confidence
IN American securities, exemplified bv
neaVy foreign purchases of American
corporation bonds
Inc outlook Is now measurablv
prlenter. The virtual settlement of the
reparations problem leaves the way
Ciear Ior combined war debts and
ulsarmament conference later in the
year, in which the European nations
VIII seek an agreement with the United
States on both questions.
GermanyS governmental position is
already improved as the result of the
"rltlng down OF the reparations ac-
count from $4,000, ,0cO,00 to STA. 600
200. The prices of German bonds late
this week illustrated the markets he
net that service on them viii be con-
tinued.
At home the slow work of reoreani-
zatlon was making itself felt in the
prices Tor Junior railroad and indus
trial bonds, while high-grade utility
issues were sought at rising prices by
eoLSerVatiVe investors, corporate and
inolVloual. Municipal issues continued
70 command scarcity premiums as the
market supply was further reduced bv
the buying by those seeking tax-exenpt
securities. New bond issues amounted
TO $27.60O,0 ,000 against $1.177.0O0 in the
previous week and $30,6l3, 500 in the
Ike 1881 week. But this weeks total
was largely composed of an issue of
Federal intermediate credit bank de-
oentures and did not therefore sub
stantially increase the supply of nu-
nicipals.
Prospective Treasury Financing.
Now that the European situation has
been clarified, the political conventions
are out OF the way and little can be
settled legislatively until after the No
vember elections, the investment mar
ket has turned its attention once more
TO prospective United States Treasury
financing and the likelihood that there
Will be a refunding operation in con-
nection with one of the two large
Liberty loans.
Banking circles incline to the belief
that nothing would so improve public
confidence as the success of large re-
funding operation. The initial success
OF the conversion by Great Britain of
her war loan 5s-a loan comparable in
size with the Liberty fourth Az per
cent loan-has stimulated sentiment in
favor of such a move Moreover II
the issue could be refunded with a 31h
per cent issue of long-term bonds there
would be q saving of S60,000,000 to
S75.000,000 year in taxes-or about
half the amount saved by the economy
bill passed by Congress.
(Copyright, 1922