Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-01-08
By HERBERT BRATTER


United States Treasury savings
bonds, long touted by Uncle Sam
as the wisest and safest way to
build a nest egg, now constitute q
vital element Of the national econ
omy after 20 years on the financial
scene.
OF course, during World War II.
the sale of Victory Bonds was an
integral part of the war effort. and
this was one of the big attractions
the bonds held for John @. Patriot.
But today. the Governments sales
talk emphasizes the investment
features of the Series e bond.
Are savings bonds. however, q
good investment for the little fell
low?
II you bought an e bond in June.
1943,. and stu hold it l2h years
later, your SIS cash investment
would now be worth $107.60. In
the interval all the interest earned
on your investment was auto
matically re-irvested. And II you
cash your bond today you come out
S32. 80 to the good. You come out
431a per cent ahead.
Or do your
Coins Other Side
Look at what has happened to
the prices of things you buy. Labor
Department records of consumer
prices. which include rent. clothing.
TRANSPORTATION, medical care. and
recreation, show that the cost OF
living in the same 1914 years has
climbed from rs to lis. Compare
this with the above $75 and SLOT so.
This means that the $l07.60 you'd
get for your bond today buys less
than the SIS you originally In
vested.
It was important that people
should buy savings bonds curing
the war. Goods were scarce then
and If everyone had spent all his
income, we'd have had q terrifie
wartime imitation and the success
full prosecution Of the war would
not have been possible.
Not all the peoples savings. Of
course, went into United States Saw:
ings Bonds. Suppose you had done
something different with the money
invested in wartime savings bonds
1914 years ago. A house that was
worth $4,000 in l943 Is worth
$40. 200 today. Your l943 series
Z bond has increased by 43ha per
cent, but the house is worth twice
as much, based on replacement
cost today.
Or suppose you had invested In
some other security. an investment
trust share. II, in mid-l943 you
had bought shares in Loomis Sayles
Mutual Fund and automatically
re-invested all income as in the
case of the series e bond. each ST.
then invested would today be worth
S268.74. This is an increase OF
&l93.75, or more than 258 per cent
as compared with Asa per cent
In the case Of the bond.
Loomis Sayles is q balanced fund
containing both bonds and stocks
Suppose, however. that you had
bought only common stocks II
lel3. Based on Standard and Poor'i
index Of $50 stocks-even ignoring
all dividends - your investment
would be worth three and one-thirt
times as much today. an increase o.
ass per cent. And dividends wouif
bring this considerably higher.
or suppose you had been smart
enough and lucky enough to buy
General Motors common stock II
mid-l943. Your capital would TO-
day show an increase Of 407 PEI
cent and the dividends paid ou
in the past 12la years would euua
another ISL per cent-or Q growth
Of $50 per cent in ell.
Many owners Of series e bonds TO-
day have a nest egg which they
would not have at all had they moi
been persuaded TO save systemati'
cally to buy savings bonds.
Shaved BY lnfIction
These postwar years have beer
years Of imitation. when money wa
losing much Of its buying power
Savings bonds suffered from this
But so did other kinds Of flxed In
come investments such as othel
Government and corporate bonds
savings bank balances. savings ant
loan share accounts. That's wha
happens in boom times.
But in bust times 1t Is the othel