FISCAL: Humphrey Solves a Problem

In trying to refund $8 billion of ten-year, 2% World War II bonds, Treasury's George Humphrey faced a problem. Many experts predicted that anywhere from $1.5 to $2 billion of the maturing bonds would be cashed, forcing him to raise that much new money. Instead, Humphrey offered bondholders a choice of new one-year certificates paying 2⅝% interest, or 3½-year notes paying 2⅞%. Last week he announced that 59% of the bonds had been turned in for one-year certificates. Moreover, 38% were exchanged for the 3½-year notes, and only $263 million actually had to be paid in cash.

...

Want the full story?

Subscribe Now

Subscribe
Subscribe

Get TIME the way you want it

  • One Week Digital Pass — $4.99
  • Monthly Pay-As-You-Go DIGITAL ACCESS$2.99
  • One Year ALL ACCESSJust $30!   Best Deal!
    Print Magazine + Digital Edition + Subscriber-only Content on TIME.com

Learn more about the benefits of being a TIME subscriber

If you are already a subscriber sign up — registration is free!