The herald., 1898-10-14
THE FIELD FOR EMPLOYMENT OF
AMERICAN CAPITAL
THE BANKERS CONVENTION
High Interest Means Foreclosure.
Fire Underwriters Of Northwest
Meet-Realty Notes
OFFICE OF THE HERALD,

LOS Angeles, OCt 10, 1850.
What the future field for the employment
Of American capital Is to be is a question
deserving attention., and Is already being
asked by bankers and investors. The i'm
mcnse outlet heretofore furnished by rail-
road construction and reconstruction Is to
q great extent closed. Our main lines are
built, and the last one to be financially and
physically reconstructed Is now undergoing
that process. "What next?" bankers are
asking. ''In what way is our capital to
find new employ ment? Where is the new
field?" Other investors are asking similar
questions.
British capital Is Invested the world ever,
and this Is true to a considerable extent Of
surplus French and German funds; but
very few Americans place dollar I'm for
egn securities. Mr.. William Waldorf Astor
Is the only notable exception to this rule.
The American invests his money at home.
He knows no other field. And as wealth ac-
cumulates here what Is to be done with 1t?
In what way and at what rate IS 1t to be
employed? Confined as he Is to his native
hnd, how ts the investor here to find safe
employment at fair return for constantly
accumulat!ng money?
These are questions to be answered in
one way only. We are to see In the next
decade lower rates Of interest and a dearth
Of high-class securities. What the effect
will be on merchant, manufacturer and
AAsSa "a OtHet IHCS VI UuSiuc>S may Dc Icit
to those Interested. but It is a financial
axiom that plethora Of money and a
dearth OF desirable securities means higher
prices for the latter. The money going into
the Treasury will soen flow back into the
lean market. With peace secured upon
satisfactory terms an era of prosperity may
be looked Forward to with confidence.
And 1t will doubtless be an era which
VIII see income from absolutely safe invest
mont reduced to 21s per cent per annum or
less and prices readjusted on that basis.
The foregoing is from an article by the
financial editor Of the New York Sun. Com
mentng upon 1t. the Bond Buyer says
There Is no security which Is safer and less
nuctuating in value than municipal bonds
except It be real estate. Within the past
five years the annual investment in mu-
Lc'pals has more than trebled In amount.
Since We bega the publication Of the Daily
and the Weekly Bond Buyer. devoted to
this particular class Of investments. the
cumber of houses engaged in dealing bn
them as a specially has very nearly quad
rupled. This increase In the volume Of In
vestments has been In spite Of the great
increase In the price Of such securities
And 1t Is safe to say that the increase will
So cil. The dema nd now largely exceeds the
supply; and the demand very largely comes
Just now from individual investors, where
as until few years ago the savings banks
trust institutions and insurance compa nies
were the principal purchasers Of mialici-
pals. although the investment of their sur
plus funds in such securities was greatly
affected by stringent restrictive laws of all
the states Of the northeast except Rhode
Island.
Municipal bonds are essentially the bonds
OF the people; voted by them for the i'm
provement Of their own property and the
development of their counties. cities, towns
villages and school districts. Every pave
ment laid. every park projected. every
sewer constructed adds to the wealth
health and beauty Of a growing town or
city; while every good road constructed
and every bridge built adds to the assessa-
blc value Of property In every county which
produces amy article which II Is imports
should have cheap and ready access to the
nearest market town