HIGH FINANCE: Any Bonds Today?

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The U.S. Treasury, which likes nothing better than to sell bonds, was disturbed last week for a strange reason: it was selling too many. In towns and cities through the South and East, the demand was so great that banks were running out of savings bonds. Reason for the rush: a new person-to-person chain letter in which bonds change hands instead of money.

"This is a giveaway wealth campaign," said some of the letters. "Give away two $25 U.S. savings bonds and get $38,400 back. Worth $51,200 in ten years." The get-rich-quick scheme, starting in the South last fall, spread into New York and New England last week. Each participant buys two bonds (total outlay: $37.50), gives one to his sponsor and pops the receipt for the other in the mail to the person on the top of an eleven-name list. He then knocks the top name off, and adds his to the bottom. Then he lines up two friends, collects a bond apiece from them (thus gets his money back), and makes sure that they each mail a bond to the new No. 1 man. By the time a bond buyer gets to the top, he theoretically should receive 2,048 bonds in the mail.

Dubious Treasury officials last week issued a warning against the plan. But such lucky bond buyers as Used-Car Dealer Cliff Pettit of Knoxville, Tenn., who with his wife and son has already received 252 bonds in the mail, were happily counting up their riches.