The Birmingham age-herald., 1924-04-13
CHECKING UP
 ON BOND LISTS GOOD BUSINESS

" HCH dh DuAS HIS llTEI DOn0 of reputable bond dealer and thereby acquires one of the thrills that come once ill lifetime" he is cordially in vited by the dealer, ito drop in every now and then. Oh, not to try to sell you any ything-just for a little visit" Then. after the investor has received one or two semi-annual interest pay ments and has opened his eyes to the indisputable fact that sound bonds are a sure road to financial independence, the bond dealer politely suggests that the customer come in at intervals .'to check over his holdings" Is
 Why do bond men do that? What is to be gained by frequently checking over bond holdings? Aren't high-class bonds such a stable, solid investment that they do not need checking oyer|'
 Answering the last question first, high-class bonds are the kind of invest ment you can put in "a strong box and forget about. That fact is so plain that many people overlook it. Nobody writes a scare-head story for the newspapers about a good bond maturing and pay ing back the principal in full. after having paid great deal more than the principal in semi-annual interest That kind of news gets short para graph on ah inside page. But the lure of speculation and gambling are con stantly- Haunted before the eyes of everyone. Most people pay entirely too much attention to--the speculative mar ket, which absolutely does not concern them, If they have invested in sound bonds. And so the investment banker, Knowing we'll that there is a strong streak of the gambler in many of us likes to keep in touch with us to pre- vent financial "back-sliding" and loss For, If we lose, he loses. too, in our inability to buy more bonds.
 Occasionally change in laws, such as state inheritance or income tax laws, may make change in investment hold ings advisable. But generally the in- vestment banker selects bonds for an investor with the idep that they can be put in strong box and left without thought or worry. He does not wish his customers to be constantly trading out of one thing into another. That breeds risk. It is the last thing an in- vestment banker would foster. He is concerned with seeing that his GUS toners keep their investment fences tight so that the bulls and bears of speculation cant break in.
 Chief of the materials for "counter. felt credit" that the public supplies is the foundationless idea and demand that huge unwarranted returns can be had safely from investments The un- scrupulous so-ealled broker uses this mistaken idea to induce people to play the market He encourages them in the belief that huge profits can be made that way. Likewise, the irresponsible promoters promise large and impossible returns on the securities they sell. Greed, demand for excessive profits and lack of information on the part of the public are the materials from which counterfeit credit" is largely made
 Money can earn a certain yield, which is generally around per cent in the north and [ per cent in the south. If the public would but realize that and would cease looking for the impossible, the counterfeiters of credit would have but little material with which to work. Since the war it is estimated, $3,000, 100000 have gone into counterfeit credit" fraudulent and worthless securities.
 Most of the large fortunes have been created by slow and careful work. A very, very few have been accumulated by lucky accidents. The investor who seeks huge yields, history shows, is almost certain. of loss. The investor who seeks safety first in investments is numbered among the financially inde- pendent. And that is proportionately true whether he be a man or woman of large or small income. An invest ment security that is worthy of the name eliminates all expectation of sud den wealth. all get-rich-quick dreams. all anticipation of lottery. A good in vestment, such as a high-class bond, is not a thing of chance, but a careful creation that is as safe and sound as science and business can make any in strument of human deyisinp.