FISCAL: Record Swap

The U.S. Treasury last week successfully completed the second largest refunding operation in history.* To refund $17.3 billions in Government securities due this month. Treasury Secretary George Humphrey had prepared both short-and medium-term (8 years and 8 months) 2½% securities, to appeal to private banks that dislike tying up money over long periods.

When the final returns were in, Treasury officials jubilantly announced that 98% of the matured bonds had been swapped for new Government securities; only $345 million was handed out in cash. A whopping $6,721,000,000, equal to 69% of private bank holdings, went into the new medium bonds maturing in 1963. The operation was another milestone for the Treasury’s efforts to lengthen out the national debt. Since January 1953, it has reduced the amount of Government securities maturing or callable from $74 billion to $63 billion.

*Largest: $21 billion refunded in February.