Dead Clock

One morning last week a group of Manhattan underwriters met in a light, breezy room of Morgan Stanley & Co. at No. 2 Wall Street. That afternoon a Morgan Stanley syndicate was to begin selling the biggest foreign bond issue since April 1937--$25,000,000 in 4 1/2%, ten-year Argentine bonds. Having already spent a rumored $50,000 to prepare the issue, the underwriters expected by noon to fix the price, parcel out the shares. At 11:45 tne telephone rang. The Argentine Government, said a spokesman calling from Buenos Aires, wished to call off the deal; "market conditions" were deemed unsatisfactory. Beyond that neither underwriters nor Government had anything to add. Henry S. Morgan, second son of Banker J. P., simply said: ''It is now a dead cock in a pit."

Argentina has a high credit rating in the U. S. It borrows frequently, pays its interest with the punctuality of a conservative savings bank. Remembering that last year a long-term Argentine issue went for 91, insiders figured the Government was unwilling to let its short-term loan go for the price (93-95) the underwriters reputedly were planning to ask.

Although the sudden move was officially termed a postponement. Argentina might well seek the loan in Europe or at home, where its 5% bonds are selling at a premium.

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