The New York herald., 1921-01-31

AN INVESTMENT MESSAGE
A Bit of History The Lesson of Which Is
Trade Your Inflated Dollars Debated Investment Securities

reduced from 21a9o to go, and n
NAMED at 29o until September l0th
1896, when it was again advances
to 2129o. But even at that the 2fq
rate was nominal During fhA
period it was not unusual for obli-
cations to be discounted by the COM
mercial banks of London at rate Of
1To per annum, and even lower.
True, investment securities have
passed through these periods un.
scathed, but generally having been
compelled to take a great deprecia-
tion in market value before the crisis
was reached. After the crisis, and as
money rates have gone down, invest
ment securities have steadily gone
up. In 1893 our financial markets in
America soon followed the English
markets. British Consols went up in
the English market to price which
gave the. buyer but little more than
2.49c on his investment. Many Of our
industrial bonds went up to a price
which yielded the buyer much less
than 40. Many of our common stocks
which were regarded as investment
securities took a market value so
high as to yield the buyer less than
SO. Nearly all municipal bonds went
up to price where they yielded the
buyer go or less. New York City
bonds sold at a price yielding only
2659s. The New York Central bonds
sold on the market at a price yielding
the buyer scarcely more than 3fo.
Now, that is one of the reasons
why we say, TRADE your inflated
dollars into debated investment Sc
curities, and,-do it now"
If you want to buy short time Sc
curity, or one with a call price onis
slightly above what you pay for it,
you may have your reason for doing
so; but that is not what we would
recommend.
If you buy the right kind Of securi-
ties you will see them advance in
value, while the money you now have
will sink in it's rental value. The
mortgage which comes due two years
from now may have to be reinvested
at a very low rate. Banks that have
been willing to pay interest on daily
balances may have to send you a
courteous note saying that hereafter
they will have to revert to their for
mer practice of paying no interest on
daily balances.
Business inactivity or business de-
pressions mean inevitably low rates
for money. Low rates for money
mean high market prices for true in
vestment securities.
While the market offers many won-
derful bargains in the way of specu-
lative securities, we believe, never
theless, that the true investment Sc
curities on the whole will yield a
much higher profit in the aggregate
than the speculative securities.
As we referred to the difficulties Of
Messrs. Barring Brothers, let us tell
those not familiar with this bit Of
financial history that while this house
had its difficulties it was inherently
sound and in due time emerged from
its troubles and is to-day one of the
outstanding international financial
houses, held in great respect by the
financial world
Our own financial houses proved
their strength in the crisis they faced
in the latter part Of 1920. Most of
our business concerns that have not
emerged from their difficulties are, as
Barring Brothers were in 1893, inher-
emily sound.
Now, in our opinion, is the time to
buy investment securities. Public
buying has been going on actively be-
fore the first of January Many of
the bargains have advanced ma
terially, but there are still plenty of
equally sound investment bargains to
be had.
If vou do not want to come to ia