THE CONVERSION PROPOSALS.
By the time that this number of the Spectator appears in print the time will virtually have elapsed for accepting the proposals made by the Government to holders of the 31 per cent. War Loan and certain of the National War Bonds maturing early next year to convert into the 31 per cent. Conversion Loan. It would be premature to discuss the extent to which the Government's proposals have evoked a response, but the success of the operation has undoubtedly been militated against by the manner in which the 31 per cent. Conversion Loan has been kept down in price since the terms of the offer were made known. Much, of course, will depend upon the directions in which the maturing Obligationi were held, and so far as the banks are concerned, it must not be forgotten that in view of the increasing demands upon them by their customers for accommodation, it is difficult for those institu- tions to substitute long-term securities for short-dated obligations. From the general standpoint of the National Finances, however no small amount of importance attaches to the result achieved by the present scheme, for if the response should be only moderate,, it means that in addition to about £200,000,000 in National War Bonds maturing in the second half of last year will have to be added any unconverted portion of the £210,000,000 nominal of debt maturing in March and April of next year.
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