BANKING & FINANCE - Jan. 22, 1992

Regulators Propose Bond Sale Reforms: In a report to be released today, federal regulators propose reforms to the $2-trillion government securities market to detect and combat “squeezes” that drive up bond prices. The recommendations are in response to last year’s Salomon Bros. scandal. They are included in a joint report by the Treasury Department, the Securities and Exchange Commission and the Federal Reserve Board. The report calls for reopening Treasury auctions and selling extra bonds or notes when “an acute or protracted shortage” occurs, whether or not it is the result of a so-called short squeeze.