The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1922-11-04

curities for lump sum. A dozen bonds
national, municipal and industrial
are offered for a lump sum. The par
value of these bonds adds up to the to-
tai Of $2S,285. The lot is offered to
the purchaser at $192.50. It seems
an excellent investment.
Another offer which recently attract
ed many Americans consisted of some
Polish securities. For a lump sum
of approximately $40, lot of Polish
bonds having a par value of about $780,
600 was offered. Secretary of Com
merce Hoover examined this proposal
and discovered that any person could
buy these securities in the open mar
ket for about Sc. The company Of
fering the bonds claimed they were
bargain at $40. 1t is not improba-
BILE that when the company printed
its circulars, the cost of the bonds in
the open market would have been as
much as $40. The elapse of some
weeks during which the printed litera-
ture was being circulated saw the de-
probation of Polish currency to a
point where the bonds could have
been purchased for S..
Doubtless some of the companies Of
fering these currencies and securities
have some faith in them and when
they prepare their literature they
quote fair prices. If the literature
should be put out at the turn of the
tide when the prices of these evidenc-
es of Indebtedness started upward,
the offerings would indeed be bar
gains. The trick in the thing is that
the chance of rise in these quota
lions is remote. To buy these cur
rencies and securities, therefore, is
to bet on a sure loser. No one ever
went to horse race who put his mon
| ey on a horse that he knew was sure
to lose. Yet, the fact that the com
| panies offering these foreign bonds
remain in business seems to indicate
that some thousands of Americans
| constantly are doing a thing equally
foolish.
| Not Enough Gold
In The World.
| The principal reason the investors
| must lose is that it is impossible for
them to win unless some King Midas
| comes along and turns everything he
! touches into gold. He would have to
work good many eight hour days
to touch objects to produce the vol
ume of gold necessary to bring these
currencies and securities back to q
| point where a majority Of the Ameri
can. purchasers would make money on
them.
Gold is the backing of bonds and
currencies. American paper dollars
are worth 81 each because the whole
world knows that there is actual gold
back of the currency. European
marks, rubles, kronen, ct cetera, arc
not worth their normal value because
the whole world knows they have
practically no gold back of them.
Now, the stern fact that makes II
| impossible for the investors ever tc
win is this: these countries have is
sued paper money and bonds payable
in paper money, in such enormou;
volume that there is not nearly enough
gold in the world to make them good
The argumet has been made that wheT
Germany, for instance, gets back or
her feet she will get the gold to pU
back of her marks and they will re
turn to par There is not enough golC
in all the countries of the world tt
bring the German mark back to, par
The outstanding volume of Austrian
crowns is approximately one trillion
An outside estimate places the worlds
gold supply at about SIC, ZOO, 000, 900, sc
it will be seen that it would take sew
eral times the whole world supply tt
take care of the Austrian crowns
alone. Yet Americans still buy Aus
TRAN crowns and Australian bond!
payable in Austrian crowns. There
are 00,000,000 900 Polish marks out
standing. There are about the sam,
number of German marks, but the Ger
man production is increasing tire
mendously. Forty-eight billion mark
were issued in the month at Angus
alone, and Germany now is ISSUING
them at the rate of 100000, 900 a day
From these figures it will be seer
that these currencies cannot return
to par. They might have, had the in
flation stopped before these amount