Money: Creating New Strains

More than $1.5 billion of debt securities surged onto the nation's financial markets last week, as the effort to borrow before interest rates went even higher turned into a scramble. Many of the new offerings paid interest rates higher than at any time since the 1920s. The Federal National Mortgage Association came in for a controversial $410 million. Cash-short corporations borrowed $226 million through bond issues, and municipalities tapped the market for another $112 million.

High interest sent the biggest issue of all surging back from the market the same day that it was to come on. The New Jersey...

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