The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1920-06-15
TWO KINDS OF DOLLARS.


In discussions of existing economic
conditions, constant reference is made
to our deprecated currency and the
value of the dollar is rated somewhere
between thirty-five I'D fifty cents.
When talking about the reduced pur-
chasing power of our currency, it
should be borne in mind that some
thing besides the circulating medium
must be taken into consideration. and
that is the thing that is to be bought.
Evidently, we have two kinds of dol
lars. One is the dollar of the spender
of the consumer-while the other is
the dollar of the investor. There
probably has never been a time in the
history of the world when money spent
needlessly represented mad extrava-
gance as it does today On the other
hand, there probably never has been
time when thrift and investment
ever paid so handsomely, for invest
ment can be made now with an in
flated dollar and held until returns
are measured IN terms of deflation.b
The dollar that is spent on luxury
frequently is not worth more than
twenty-five cents compared with the
coin of pre-war days. The five dollar
silk shirt of the summer of 1914 has
sold for more than twenty dollars in
the last year. The quarter
collar of five or six years ago has sold
M than three times as high as that
since then, and it is doubtful If its
quality has been maintained. Shoes.
clothing. amusements and fancy arti
cles of food, all have advanced enough
in price to diminish the buying power
of the dollar.
The dollar of the investor has stead
lily grown in size. Measured in terms
of return to the thrifty buyer, 1t has
a value of $50 to 200 cents to the dol
lar. The most attractive opportunities
for the investor today are presented by
railroad bonds and seasoned dividend
paying railroad securities and govern
ment bonds. In 1915 when the dollar
of the consumer had not yet begun to
dwindle. silk shirts. high grade shoes
and other articles which subsequently
have mounted in price were still meas
ured in terms of currency at one hun
dred cents to the dollar, standard rail-
road shares were selling on an entirely
different basis from that which pre-
walls at present.
In 1915 Atlantic Coast Line with a
5 per cent dividend rate, sold as high
as 126, which reduced its yield to 3.97
per cent. It is now a per cent stock
selling around IS and making a re-
turn of SIS per cent, or more than
twice as high az in 1916. Great North
ern Preferred at it's high level in 1916
made a return of only SAC per cent
and on the present basis of ~ gives
the investor a rate Of 9.72 per cent
Many standard railroad bonds which
four years ago yielded from a little
over to per cent now have yields
ranging from to per cent.
All of this goes to show, says the
Wollman' Review. that thrift never had
a higher premium placed up6n it than
it has today, while exit avaganca or
needless spending carries heavy pen
atty. This development is a logical
response to economic forces. The
world is short Of goods and, therefore,
prices are higher. Those who wish to
buy must pay the price. The world is
short of capital and is willing to pay
handsomely for it. This gives the in
weston his opportunity.