Evening star., 1924-07-05
EVERYMAN'S
INVESTMENTS
By George T. Hughes
rhirty.Ninth Article-Gold Bonds.

Thfrty-Ninth Article-Gold Bonds.
Listen to the conversation at the
assistant sales managers desk. The
SUGGESTION came from the sales man
aser Of a banking house on whom 1
was calling. "Oh, it's quite ethical"
the sales manager smiled at my look
of surprise. Nothing confidential.
Besides, you may get a helpful slant
on the way many persons neglect ex-
pert advice when they make invest
ments."
Across the aisle the assistant sales
manager and a middle-aged woman
were considering the houses offerings
of some twenty-five investment Sc
curities Apparently, she was
woman of means, and they were Sc
lecting investments for $4,000 or
$4,000.
Here's good industrial" The
sales manager named an excellent
bond of a company with long his
tory of good earnings and splendid
management. Il can recommend-'
Opposed to Industrials.
"Oh, I don't like industrials" With
impatient inde1niteness the woman
swept that high-grade security aside
at a dinner that he didn't care for
industrials.
The assistant sales manager pa
tiently and briefly described the
worth of the bond, one 1 should be
delighted to own. Then he named
four or Ave more good securities,
skimming the veritable cream from
intangible objections. Finally he
suggested an excellent bond, one of
the best foreign government external
loans. payable in New York in Ameri-
can gold.
"oh, don't like foreign bonds" the
But this is a gold bond" exclaimed
the assistant sales manager.
'Ill take three of them," replied
the woman.
Word "Gold" Sells Bonds.
The word gold" had sold her. The
sales manager smiled resignedly. 1t
was a common occurrence, this trying
investment study and then having the
customer disregard it and be con-
WINGED by word or phrase that often
may be very minor consideration.
That foreign bonds be payable in
American gold dollars Of the present
nent requirement in these days of
Debated European currencies and un-
certain political conditions. But it is
not the first requisite. The ability of
the borrower to pay, whether q gov
eminent, a corporation or an indi-
vidual, is the first consideration. If
the borrower is unable to pay, it
makes no difference whether he has
promised to pay in gold, rubles, laurel
leaves or Goldfish. Putting the word
gold in a doubtful security doesn't
make it stronger, doesn't increase the
ability to pay.
Greater Caution Urged.
am not objecting to the precau-
tionary gold payment requirement,
but to the fact that many persons
exaggerate its Importance. Now and
then I see very ordinary bond with
a very narrow safety margin behind
| it labeled as gold" bond. And the
word gold" seems to attract people,
while at the same time it detracts
their attention from the more impor-
tant consideration as to safety. II
you think that the United States may
some day be in a condition similar to
that Of Germany or Russia, insist on
gold bonds. to prevent payment in
debated currency, but don't get the
notion that because bond recites
| that it is payable in gold that those
few words mend any defects 1t might
have as to safety and general de-
STABILITY.
] (CppyxiSht. t1el. hy Consolidated I1aR Aaa,l