Note: Stocks are arranged in redemption order.
Price, Yield, Price, Yield, Stock, and Date of Redemption Nov. 16 "19, Nov.16 July 20, 1939 Mini- Oct. 19, 199 High mum 69 414% Conversion Loan, 1940-44 105 5% Conversion Loan, 1044-64... li -$ 1 0 142 313
2126 Mia 315 215 0 i 364 Sil 3 92% 516 306 H 310 9 396 i100; 404 343 mi 313 3 330 s 312 5 380 1054 3171 310 (93 317 7 3438 Bu 313 349 94 3131
510 EJ 318.0
510 [4 315 9 5 96 5 315 0 $14 1 1097 317 2
380 75 st 6 3180 313 79 Ga 1 31? ment of higher income tax, and three it is clear months' increase in indirect taxes, to. the extent of approximately "£90 millions extra on revenue account, should provide a useful surplus. There is, therefore, a certain urgency in making provision for war borrowing in the current quarter. Meanwhile, scope for a further increase in Treasury bill issues—if it is judged by Sir John Simon's intentions last July—scarcely exists, for between July 15th and October 14th the total bill issue increased by £174 millions, compared with a mere £33 millions in the corresponding period of 1938. The Chancellor contemplated raising £150 millions, out of total borrowing of £502 millions, from Treasury bills. Tucreased total borrowing, combined with the money market's still unsatisfied appetite, however, should justify resort to increased short-term finance. If it does not, then the authorities will be compelled to redouble their efforts to set the stage for a long-term operation, or series of operations. In fact, no valid reason is evident for adhering to the maximum suggested increase in the Treasury bill issue (which appeared to be put at a relatively low figure in the first place) in view of the greater financial burden of defence. Tt is suggested in a Finance Note on page 97 that the discount market is stil about £120 millions - short of bills—and it could, of course, take more than this figure. Short-term borrowing, in fact, can meet the Exhequer's demands for a month or two yet.
New Borrowing Next, the pricing of new borrowing clearly warrants careful consideration. The current level of long-term. interest rates is still little short of 4 per cent. compared with Mr. Keynes's proposed maximum of 2% per cent. for defence borrowing. These that the short-dated stocks have the advantage, and that preparation will have to go considerably further before the "longs" stand on an economical issue basis.
Text read from the printed page and cleaned; old type leaves the occasional error.