Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1919-11-04

NTASHlNGTON, D. c., Oct. 3t.-Every day
w some scores of people from Tampa or
Tacoma, from Providence or Pueblo, or
| from some other point on the big map OF the
most prosperous nation earth, write letters
to the treasury department at Washington, and
ask advice as to safe investments for the
moneys that are accommodating in their rJcketS
That department does not want to put itself
| in the position of unduy pushing its own
wares, but it has a lot of confidence in the
government securities that are kicking about
and really feels that an opportunity to profit
on an investment in those securities is about
as good thing as one should want. If prop
erly pushed, treasury officials will reveal a
situation which makes it look as though an in
weston might go far and fare worse than by
purchasing government bonds.
In all there are ten carietieS of war bonds
on the market. The government has none OF
them for sale. They are already sold They
are now owned by the people. The govern
has got to pay interest on thelh at par and
has got to retire them at maturity. 1t is all the
same to the government if they sell at ninety
or a hundred and twenty.
The first Liberty bonds issued drew the
lowest rate of interest They were three and
half bonds. Strange to say, of all the issues
this is the one that is today bringing the high
est price. These three and halls are now
selling above par The reason for this is
that they are exempt from income tax Rich
folks whose surplus income goes largely into
the Golfers of Uncle Sam buy these bonds and
are allowed to keep the whole three and a
half per cent. They are a good buy for the
rich folks, but they would be the worst buy
in the lot for poor who is not paying a
high rate of income tax.
1t is peculiar that the Fourth Liberty Loan
issue, which pays four and a quarter per cent
interest, sells way below par. 1t is the cheap
est of the government securities on the market.
1t sells around ninety-four. 1t is not exempt
from income tax and SO is not so good for
the rich man. 1t is fine, however, for the poor
man. IT is worth more than ninety-four The
reason it is cheap is largely due to the fact
that there is so much of it. 1t was the big
issue. There is six billion dollars worth of it.
There is always a certain per cent of bond
holders who. are forced to sell for one reason
or another. Of big issue there are more
holders who put their bonds the market.
The old law of supply and demand works and
the price is run down. The Fourth Liberty
Loan four and quarter at the present price,
pays AT per cent on the investment.
The bankers favorite of the Liberty bonds
mature in ten years. They are selling little
below par. The interest is good and the early
maturity inSureS a profit on the buy. At the
present market price they figure to yield 487
on the money put mo them
Then there the second fourS and a
quarter. They are the buy of them all that
just now yields the highest return on the in
veStment. They sell around ninety-four The
government has the privilege of retiring them
in 1927 and will probably do So This means
that there will be a profit of six cents on each
dollar. This added to the interest that will be
collected in the meantime means that these
government bonds are today 5t8 per cent
investment, which is mighty good for the bonds
of the government which is the most financially
sound of any in the world.
These figures are based on the known fact of
the rate of interest paid on these bonds, and
the known figures at which they will be re-
tired. There is nothing speculative in gov
eminent bonds bought at these figures. One
knows exactly what his returns WI be-