The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1896-01-27


about 800 share; the Maine Central,
par value of which is $l0U share. sells
for about 1885, In the latter case
TIE MARKEET VALUE
Though the par values of both stocks are
the same. The price Of stock depends
on the management of the corporation,
amount OF dividend paid, its future pros
poets and past history and upon the ma
ture of the property itself.
MIR. Woodbury. described preferred
| stocks and the method of speculation in
stocks, defining certain terms used in
stock speculation.
MI. woodbury. defined bond as being
ia the nature of promissory note. as the
obligation of city, county or state to
pay certain amount OF money with In
terest paid at stated periods upon certain
conditions.
The bonds of a company may be per-
feotly safe Investment when the stock is
not. and the stock of a prosperous and
suocessful company paying large divi-
bends or having large surplus may sell
at higher price than the bonds OF the
same company, the income of which is
limited by the agreed rate Of interest
which they bear.
MI. Woodbury. then described the
different kinds OF bonds. hYst and second
mortgage, consolidated mortgage, con-
vertible land grant bonds, sinking fund
and income bonds.
OF the securities named he said, it is
not advisable for safety to invest in stocks
unless they are or q local nature or in
established companies, and the corpora
tions controlled by persons well known
and thought of In the community.
Government bonds are considered the
highest grade of investment securities,
but the price they command is SO high,
making the rate of interest returned on
the investment go low, that very few
parties can afford to buy them.
Undoubtedly the safest promise tor in
vestmento trust funds outside of gov
ernmsnt bonds is what are known as
MUNICIPAL BONDS.
The strength Of the municipal bond
lies In the fact that eyeryone's property
is mortgaged to pay the municipal debt.
The holder of the bond can compel pay
ment If the bond is legally issued and it
is tbs imperative duty Of the Off oials of
municipality issuing bonds to levy
taxes on all property within it's limits.
Taxes are prior lien, first mortgage
on property.
In investing in municipal bonds like
every other investment care should be
taken in selecting them; one of the feat
ures that should govern one in the selec-
tion of municipal bonds is the class of
Inhabitants living in the municipality.
There Is no doubt that some GLASSES of
citizens have a keener sense of honor
than others. The New England States
have always shown a creditable dispo-
sition to pay their Indebtedness even when
the 6ahtWpa lqroa q nd tho Con {rjons hand
Some municipalities in New England
have acknowledged and paid debts when
they were undoubtedly illegal.
He suggested as some of the most i'm
portant factors in determining the
| selection Of municipal bonds: First,
ratio of indebtedness to assessed valua-
ton; second, geographical location third,
ty; fourth, the purpose Of issue; fifth,
| that the legality of the Issue had been
| satisfa ctorily passed upon by a competent
attorney.
| Besides the government and municipal
bonds for investment there are different
GLASSES of corporation bonds railroad,
water company, street railroads, manu-
| featuring companies &c.
A WATER BOND
Is issued by a private corporation which
has secured a franchise for supplying a
city with water and is quasi public in
it's nature because its relations to the
municipality are of the most intimate
kind. 1t receives hydrant rental from
the city for supplying 1t with water and
the city also regulates the charges to pri-
vate consumers under on agreement with
| the water company.
| That water bonds should be as rule,
| safe, is owing to the fact that water is a
| necessity, no substitute even in this bril-
liant age of invention have been suggested
safer from competition than other corpor-
ations expemt from bad debts as they
make their collections in advance, and
loss by fire as most of their property is
under ground. Care should be taken how
ever in purchasing water bonds that the
works are substantially built, that the
franchise is a fair one, that the company
is not over bonded aud that the manage
mept is IN the hanos of honest and cap
able men.
Street railway bonds have been pur-
chased by inventors to great extent dur
ing these past few years and great
many OF this class Of bonds have come on
to the market owing to the fact tn at a
great many corporations were changing
| from horse power to electricity and ssu-
| ing their bonds to obtain the necessary
funds to make the change. They are
not open to the competition that steam
railroads are as it Ia difficult after the
streets are oocupie by one company for
another company to get franchise
to use the same streets. 1t Is evident
that the public would not be any better
served by allowing competition of this
character.
| Care should be taken when investing
in street railroad bonds to inform
oneself that the operating expenses as
estimated are sufficient to operate the
company safely. The claim that Is to
10 per cent Of the gross earnings will
operate the road is misleading and it is
much safer to allow so per cent.
In relation to steam railroad bonds,
MIR. Woodbury. said that bonds of this
character should be purchased only
where time has proved their soundness,
that there are great many sound and
safe railroad bonds has been proved,
and many of them sell at very high
price, but every new railroad is moro or
less of an experiment.
Mr.. Woodbury's paper received the
closest attention and by the time he
had finished the inquisitive minds of
the ladies werewel stored with questions
about money, Stocks bonds, Investments,
coupons, assessments, losses, interest,
dividends, certificates checks, bank
| hooks saviDoa and lonns not eyoanfin O