The Washington herald., 1913-04-05
NEW ORLEANS COTTON.
COURAGE IN A
CRUMBLING MARKET

Copyright. 1918. by G. NJ Keys. New York;
An old Wall Street banker, who has
lived through three panics and one long
continued depression, was visited the
other day by a would-be investor. The
banker is one of those men who never
let's emotional or sentimental considera-
ton obscure his vision. He sees things
much the way the camera represents
them. In other words. the intrinsic value
Of an old underlying railroad bond looks
just the same to him whether he Is look
ing at In the clear day light of good
times or through the mists and storms
Of panic.
The investor is a large holder Of good
bonds and stocks. He had come to in
quire about these as well as to figure
out with the banker what to do with
some money that was idle. He confessed
that he was troubled by the decline in
the prices of the securities he holds: but
he added that he was perfectly willing
to take the judgment of his banker both
on the question of continuing to hold
these securities and on the question of
buying some more of the same character
The banker as usual with his class, be-
gan to reply by discussing current con-
-ditions. He stated fatty that neither, he
nor any other living man could foretell
with any accuracy what the course of
prices would be over the next six months.
He outlined the half dozen chief causes
of the worldwide pressure on securities
so clearly that the investor at first lost
all desire to invest and wanted to sell
what he had. Then he carried his an
alysis forward to show how other causes
might at any time come into play. There
might be, for instance, an outburst Of
optimism and a resumption Of CONNER
cial progress in Europe at the end Of
the Balkan war. A clear announcement
Of our own policies at Washington might
relieve the pressure here. Any one Of
half dozen favorable factors might
tend to healthy upward swing.
Summing up. the conclusion to which
the banker progressed left the investor
hopeful if not exactly cheerful. He point
ed out that in the best and safest Of
American bonds. for instance, prices are
on the average lower today than at any
period of time in the past fifteen years
except-with some exceptions - in the
panic of 1907. He showed how, on the
doctrine of averages, an investor in gilt
edged securities today simply could not
help but find himself In the course OF
time holding very excellent securities at
prices far below the average over a ten
year period. he proved, almost with
precision that high grade
made today, must prove
profitable as well as source of substan-
tial income in the hands Of any man
who made 1t.
The upshot of the interview was that
this investor bought a considerable
amount of good. solid, municipal and rail-
road bonds, a smaller amount of public
utility bonds and a certain small amount
of gilt-edge short term notes. This last
investment was strongly recommended by
the banker because, he said, there may
come an opportunity within the next year
to pick up at bargain prices some more
bonds; and IL such an opportunity comes
the money put into these notes will be-
come readily available for that purpose.
1t may be noted that this banker did
not say that prices are as low as they
will go. He did not pretend to have the
market in a card index. so to speak. He