The Tiffin tribune. (Tiffin, Ohio) 1868-1887, 1871-03-02
THE NORTHERN PACIFIC RR

A man having money to invest
asks the NJ Y Independent the fol-
lowing questions:
1. Do you think that, as a rule, first
mortgage railroad bonds are a desira-
bic investment? In what do they
differ from first mortgage on ordi.
nary real estate?
2 notice you recommend North
ern Pacific seven-thirties to investors.
Why do you regard them as unusually
secure? ?
The following are the Independently
answers:
I. Thus far the first mortgage
bonds of American railways have
proved TO be among the very safest Sc
curltles- In proportion to amount.
they have probably shown a smaller
percentage Of loss in interest and prin-
cipal than any other investment that
has been accessible to the peoDle-
Such has been the history of railway
securities. OF course there have been
exceptional cases of mismanagement
and loss; but far Oftener have inner
feet titles, lapsed insurance policies.
and shrinkages of value rendered real
estate mortgages a bad investment.
There Is living principle underlying
railway bond, which applies TO very
few if any other securities. This:
l.. Usually the sclvency of a rail-
road depends mainly upon its traffic;
and, as rule, that traffic steadily in.
creases as the road grows older and
the population along its route becomes
richer and denser. In a word, the in
come Of railroad and hence its debt
paying ability will ordinarily keep
pace with the growth of population.
2. A railroad, once built, rapidly
creates business which is to render
it profitable. 1t deUelOpes a CARRYING
trade which did not before exist, and
which grows much faster than the
tributary population increases in num-
bers.
3. A railroad usually has back of it
a strong corporation of capitalists and
shrewd, energetic business men, whose
profits, financial standing, CONNER
cial reputation, and official positions
depend upon the sOlvency and success
of the road wish which they are iden-
titled. This powerful combination of
private interests constitutes a living
power whose efforts tend constantly
to increase the proitableness and
sOundness of the enterprise in whose
interests they are enlisted.
4. Finally, after railroad is built,
every dollar expended in making i'm
prOvements and extensions, adding
new facilities for doing business, and
in securing valuable alliances with
connecting lines, adds to the recurity
Of its first mortgage bonds, by aug
menting the productiyeness and value
of the property on which these bonds
are based. 1t is in this way that
second mortgage may increase the
safety of the first. With mortgages
which rest upon improved real estate
in our midst the security steadily de-
teriorates with time, as the improve
ments become less valuable. Rail
roads grOlC better and more prosper
Gus lUith age, and furnish q constantly
increasing security for the debt Great
ed IN their construction. 1t is for these
that first mortgage railroad
bonds are among the very soundest
that can be had.
IL 4A4C @NOl IAGlA dClAlC ndlALOdu
has threefold solidity, which renders
it financially impregnable. l. 1t has
for its broad and firm foundation a
real estate endowment of more than
Thousand Acres of fertile
Land to each mile of track-or an un-
farm of 500 acres lin addi-
ton to the ordinary and ample secur-
ity of the road and its traffic) to secure
each 81 900 bond bought by the public.
,. 1t has awaiting it a business
which we believe is certain to render
it self-sustaining from the first, and to
give it large surplus atan early day.
8. 1t is in the hands of men of known
and acknowledged integrity, whose
financial standing, whose business sa-
gacity and thorough experience, fur
nish complete guaranty that econo-
my, energy, and fidelity will charac-
teriZe its management.