New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-04-10
Things to Look for in Partial Payment
plan

questions and answcrs 10 lit my case and
en- as yet undecided what to do am a
workinginar OF forty-thrr~ years. saving
what J can for the proverblal rainy day
LAST June opened up part payment &c,
$500 G Mn 'e ssut M"F naI Gs
$500 Pennsylvania Rallroad is, 1880.
am am paving OFF the~ bonds at from $50 to
mas made me feel uneasy. | notice that
you 90 not favor tho part. payment plan.
Globe. and also note that the financial
adviser does not approve Of the part pay
ment plan either. so AZ have about $500
IN in, The sayings bank, am wondering
whether should draw about $500 and pay
me rest or my purchase in cash. VIII you
please advise on this question? also
notice that on the monthly abatement that
receive from John Muir & co. I find II
ceasr1rying and interest charge OF from So to
receive no interest for the first year on my
purchase; 10 you think 1t more profitable
and advisable for me to draw from tho
1911 have been buying the part pay
men msnt plan mostly 500 (baby) bonds
year. And this last purchase OF $500
United States Rubber and $500 Pennsyl-
vania Railroad is the biggest thing'J have
, grim what want. Please advice me also
viii savings banks give mo credit for bond
company Which Would take ' snch a small mail
amount as $4,000 to $4,000 in bonds in
charge to collect my coupons and give me
credit? p. w. b.
Answer - We would consider that
since you have the money to paw the
full purchase price for your bonds al
ready in the savings bank, and since
you could draw enough out to pay the
balance due on your United States Rub
Der ia per cent bond and Pennsyl-
vania per cent bond and still leave
you some cash in case Of emergency,
you will save money in interest
charges, etc, by so doing. We cannot
say what your savings bank will do
IN regard to giving you credit for the
coupons on the bonds as they become
due, but there are number Of trust
this and. would give their careful at
tention to four or five thousand dol
lars of bonds. Among others there
are the Columbia Trust Company,
Guaranty Trust Company, etc. Some
Of the savings banks, such as, for in
stance, the Broadway Savings Bank
will credit your coupons in your book
and will keep the bonds in safety for
you. letting you cut your own coupons,
however. We have never made sweep
ing condemnat on Of the partial pay
ment plan, but we always advise
against the use of it for the purchase
~ spy wv oCSui AIitS' ~ Is u uc-
vice vic, widely used by unscrupulous
brokers to tempt the unwary into
margin trading when they are not
qualified for it, and to get investors
on the books with the idea of later
unloading questionable issues. When
speculative stocks are so bought there
is always the chance that the order
will be bucketed if the broker is not
Trustworthy and the customers equity
greatly reduced or wiped out before
his payments are completed. There
are many brokers with large mailing
lists in this business who do not even
belong to any exchange. Some of them
guarantee not to make margin calls,
and one at least pretends to guarantee
has customers accounts. Both of these
guarantees, if sincerely made, would
require so much capital that no repu-
table broker would think of Offering
them. Your success with this plan
over a period of ten years is undoubt-
eddy due to the fact that you dealt
with members of the New York Stock
Exchange and confined your investments
to safe securities. Any time you find
yourself with the cash to take up your
securities, however, do it, for even
brokers who are members of the big
exchange sometimes fail and there is
no advantage to you in asking your
broker to pay for your securities when
you can do it yourself. Such policy
is likely to lead you to overextend
your commitments.