New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-02-20
Where Municipals Are Desirable

eat about $4,000, which belongs to my
mother and want the safety OF her
principai IA assured; , have read with great
column. but I note that nearly all the In
duiries want the highest rate of interest
other words the safety OF principal Ia not
the only consideration. In my my
mother will have sufficient income. so that
sake of owning the very best securities. 1
am wondering If you would care to have
your financial man advise me of twenty
1--WE or so OF khe best obtainab bile bonds of
fairly long maturity. rails and industrials.
While, of course, subscribe for The Trib-
une, 1T does net come regularly because Of
the bad congestion of malls here CLOS
Angeles), and SO l would greatly appre-
ciate q letter. may say that my mother
and hence feel that we do not need any
more of those bonds. / also would like q
list of good municipals and state bonds
where the legality of the issue Is undis-
puted.-M. G.. G.
Answer-You have not mentioned
specifically the income tax as it affects
your mothers investment, but it is our
conjecture that that feature is prob
ably important For instance, if her
yearly income is between $4,000 and
$4,000 she must obtain yield of 6.04
per cent on a taxable bond in order to
get the same net yield as she would
have on a tax free bond of equal or
greater security yielding only bh per
cent. This takes into account the Fed
able in California, besides, we think
that the best investments for her are
California state and municipal bonds,
on which she will not be taxed. There
are state obligations of per cent cou-
pom rate (which will yield per cent
for long, and SO per cent for me-
dunn maturity. Municipals are avail
able as follows: San Francisco AVS,
July, 1923, to yield 51a per cent; July,
1899, to yield SO per cent, and July,
1861, to yield $40 per cent. Los Angeles
IS, 1934-1939, to yield $50 per cent;
Los Angeles School District 51as, 1886
1861, to yield so per cent. There is
a large block of these. The others can
be had in various amounts. There are
$4,000 San Diego 5s, 1934-1951, to yield
So per cent, We think that if you are
going to invest in municipals the fore
going are the best because state and
municipal bonds of governments out
side the state in which your mother
lives are taxable in California to such
an extent that their yield would be
negligible. There are many high grade
bonds which are readily marketable
and selling far below their average
prices for the last ten years. Here are
some of them: Atchison general As,
1895, to yield 504. per cent; Atchison
adjustment, 1895, .tS yield 5.52 per cent;
Atlantic Coast Line LIST 4s, 1862, to
yield 5.38 per cent; Chesapeake &
Ohio general 414s, 1892, to yield nearly
6 per cent; Chicago, Burlington &
Quincy, Illinois division, Is, 1949, to
yield SOB per cent; st. Paul general
ic ~ ~ j r.
Island general 4s, 1883, to yield sos
yield 5.6S per cent; Colorado & South
ern list As, 1929, to yield 7.12 per cent;
Delaware & Hudson refunding As, 1913,
to yield sos per cent; Illinois Central
lst As, 1851, TO yield 500 per cent;
Kansas City Southern LIST IS, 1850, to
yield over per cent; Louisville &,
Nashville unified As, 1910, to yield
5.37 per cent; Minneapolis, ST. Paul e.
Saulte st Marie 1st cons. 4s, 1898, to
yield $40 per cent; West Shore 1st as,
1851, to yield 54S per cent; Norfolk
& Western consolidated Is, 1896, to
yield sos per cent; Northern Pacific
prior lien as, 1897, to yield sol per
cent; OregonW Washington Railroad G.
Navigation 1st and refunding as, 1861,
TO yield 5.64 per cent; Pennsylvania
Consolidated AIS, 1860, to yield SOC
per cent; St. Louis Southwestern 1st
4s, 1889, to yield 5.SS per cent; Central
Pacific refunding 4s, 1949, to yield
5,88 per cent; Southern Pacific refund
ing 4s, 1855, to yield 5.44 per cent;
Southern Railway !st consolidated IS,
1894, to yield 5.62 per cent; Union Pa
cific refunding As, zoos, to yield 4.97
per cent; Montana Power 1st 5s, 1913,
to yield 6.12 per cent; American Tele-
graph and Telephone as 1946 to y;aId
6.46 per cent; illinois Steel debenture
AIS, 1040 to yield Sol per cent; New
York Telephone 1st and general AIS,
1889, to yield $40 per cent; United
States Steel IS, 1868, to yield 5.29 per
cent.