mous increase in the telephone industry itself. The rapid increase in the number of telephones in use during the past few years of prosperous times is something enormous. There seems little expectation of an end of this in a growing country like ours so long as prosperous times continue. How many telephones will be returned, and how great will be the falling off of users in bad times, is difficult to predict, but such times of depression will affect, to a greater or lesser degree, most classes of business, and it would seem that there is as much reason to anticipate unsettled conditions in relation to industries in general as to the telephone. The latter is becoming daily more and more a necessity of modern business and social life.

The ability of the parent company to maintain its present rate of dividends upon its capital stock is a question beyond discussion here.

The stocks and bonds of the operating companies as investments depend entirely upon their locality and the existence of competition. They have proved very satisfactory so far, and there seems to be no reason why, as a class, they will not continue to be. The investor, in each case, should select with care, as he would the securities of any other corporation.

The independent telephone companies have been very largely situated in the West, but are now becoming more generally distributed through the country, and have been a fruitful source of competition to the companies above mentioned. This competition has not resulted very seriously to the American Telephone & Telegraph Co. itself, on account of its large earnings as a whole. It could afford to operate a licensee company, here and there, at a loss in order to meet competition. This has, however, been somewhat hard on the company so operated. Many franchises granted in the Middle West to independent companies have been conditioned upon these companies not selling out to the American Telephone & Telegraph Co., or any of its licensee companies. Many of the independent companies have been successful and the number of exchanges is astonishing.

These comparative figures taken from the United States Census Bulletin covering the telephone statistics of the year ending Dec. 31, 1902, are given for the reader's consideration.

In this bulletin is also the following paragraph:

"The American Telephone and Telegraph Company re

ported that in addition to the telephones operated by it and its licensees there were probably included with the telephones reported by independent companies Bell instruments leased by 84,021 subscribers and operated under sub-license arrangements with its licensees."

In the report of the president of the American Telephone and Telegraph Company to the stockholders on March 26, 1907, appears the following, covering the year ending Dec. 31,

1906:

"The number of exchange stations at the end of the year operated by the companies which constitute our system was 2,727,289. In addition to this number there were 297,290 exchange and toll stations operated by companies or associations under sub-license contracts and making use of our telephones. Adding also telephones employed for private line purposes, our companies have a total of 3,068,833 stations. The total mileage of wire for exchange and toll service was 7,468,905 miles, of which 1,688,987 miles were added during the year."

For the past three years the company shows the following increase in subscribers' stations:

Under date of March 2, 1907, James B. Hoge, President of the International Independent Telephone Association, contributed the following: "There are approximately 3,500,000 independent telephones installed in the United States, and over 7,500 independent telephone companies operating in between 14,000 and 15,000 cities and towns."

Without making further comment on these statistics, it may be well to bear in mind that it is a recognized fact that the expense of operating an exchange increases enormously with an increase of subscribers and many of the independent exchanges are as yet small ones.

In newer sections of the United States, these companies have naturally met with greater success than in New England. This is partly due to the nature of the latter people not to change so rapidly to a new thing; from one company to another; partly, also, to the loyalty of the people to the oldBell," and its many shareholders, both in the old and successor company. Local prejudice has also, in many instances, aided the independent companies.

The fact that telephone companies, as a rule, are peculiarly exempt from certain disadvantages common to many other corporations rendering public service, should be given a moment's thought. There is very little likelihood of strikes and

labour troubles and comparatively small liability from accidents and resulting losses for damages. Telephone service being usually paid for in advance, little loss of revenue is experienced from bad debts.

The securities of the "Independents" are being quite extensively handled in some parts of the country. There must be many investors ready to take them, and, as a class, they may prove satisfactory. Very likely there is plenty of room in these progressive growing States for both the rival systems. Let us hope so. But give due thought to the fact that the independent companies, on the one side, are a lot of disunited corporations, with many different managements; on the other hand, the centralized management of the "licensee companies" through their parent company must give the Bell system a certain advantage.

One word more. It is, the writer believes, a noteworthy fact that, even in periods of widespread business depression, there has been a comparatively slight falling off of earnings in the telephone business. Naturally, there is more or less economizing in this direction, but it must be borne in mind. that many of the telephones are in on yearly contracts, and subscribers, in any event, are likely to order out their instruments as one of the last means of economy.

Teller. The one who receives the money at a bank, when taken for deposit, is called the "receiving teller." The one who pays out money, as demanded by the depositors, is called the "paying teller."

Temporary Receipts. Corporations issuing bonds or other securities may wish to obtain money from the sale of the same before the actual securities are ready for delivery. "Temporary receipts," so called, are frequently issued at such times to the purchasers, to be exchanged later for the securities themselves.

Tender. See "Bid."

Tenn. Coal. Tennessee Coal, Iron and Railroad Co.

Tennessee. Tennessee Copper Co. There is also the Tennessee Coal, Iron & Railroad Co., generally known as Tennessee Coal and Iron."

Ten-Twenties. Bonds due in twenty years, but subject to redemption after ten years from date of issue, at the pleasure of the issuer.

Term Deposit. Same as "Time Deposit."

Terminal Company Bonds. Proper terminals that is, passenger and freight stations, yard room and trackageespecially in the larger cities, has become a matter of vast importance to railway companies. In many instances the

very inability on the part of a railway to secure proper terminal facilities has prevented its entrance into a city. Frequently railroads are unable, on account of conditions in previous mortgages outstanding upon their property, to create an additional indebtedness to pay for terminal properties; or, again, several railways wish to share the same terminal facilities. For either of the above, or possibly for other reasons, a "terminal company" may be formed, upon which distinct issues of securities are created, the proper contracts being executed with the railroad or railroads using the same, to provide for all charges for maintenance, interest, etc. It is quite customary for the railroad or railroads to guarantee a bond issue by such a "terminal company."

Bonds of the above nature, as a rule, are considered very safe investments, as is evidenced in Massachusetts by the fact that the bonds covering what is known as the South Terminal Station have been made a legal investment for savings banks in that State.

An investor contemplating the purchase of a terminal bond must consider several things:

First, the strategic position occupied by the terminal itself; that is, whether or not satisfactory terminal facilities for the company's using the same could be found elsewhere.

Second, the standing of the road or roads using the terminal and their earning capacity above interest upon their own bonded indebtedness, whether or no in good times or bad the excess of earnings will be sufficient to meet the terminal contract.

Third, the character of the contracts drawn between the terminal company " and the railway company or companies, whether or not such contract or contracts properly safeguard the interest payments during the full life of the bond and. provide for the payment of the principal when it matures, unless the real estate value of the terminal property is so much greater than the bonded indebtedness that the payment of the principal need not be considered.

In brief, terminal bonds upon properties difficult to dupli

The cost and importance of terminals in the larger cities is well illustrated by a struggle between two of our great railroad systems in competitive railroad building in the Northwest. The Railway Age declares that one company is reported to have invested between $11,000,000 and $12,000,000 for terminals in one city, the railroad extension leading to it being but 180 miles long, upon which the expenditures for terminals would be equivalent to $64,000 per mile, or probably a greater cost than the actual construction of the mileage itself. Estimating at $50,000, the total cost per mile of the extension, securities will undoubtedly have to be issued to the amount of about $114,000 per mile. Even with the realization of the large traffic which it is anticipated that the extension will bring about, such traffic will have to be exceedingly heavy to justify the construction of such an expensive piece of road.

cate and in important railroad centres or shipping points should be good investments if proper care is taken to look into the securities along the lines suggested above.

Term Insurance. A life insurance policy of this class is one that is taken out for a stated number of years; the face of the policy to be paid only in case of death before the expiration of the term. A term policy has no value after its expiration.

Term of Discount. The length of time for which a note is discounted," to which subject refer.

Terms of Sale. Conditions, other than price, named by the seller; or the price only; or both.

Thaler. The "thaler" of Germany is an old silver coin of the value of three marks or about seventy-two cents in our money. Until recently these coins had full value as legal tender; they are now being rapidly recoined into other pieces in the German monetary system.

The Papers. See " Documents," meaning the same.

Third Consolidated Mortgage. A very uncommon issue, but a reading of "Second Consolidated Mortgage" will naturally make this subject understood.

Third Mortgage. A mortgage placed upon property which already has two other mortgages existing upon it: for instance, a certain piece of real estate, supposed to be worth $15,000, has against it a first mortgage for $5,000 and a second mortgage for $3,000. The owner wishes to borrow $2,000 more, and finds some one who is willing to accept a "third mortgage," upon the same, for that amount, making the total mortgage indebtedness against the property $10,000. Imagine that the owner of the property is unable to pay the interest upon the "third mortgage" when due; in order for the holder of this mortgage to protect himself, he must foreclose the property under his own mortgage and pay the holders of the other two mortgages their due.

In taking a "third mortgage,' third mortgage," one should have reason to believe that the property will, at any time during the life of his mortgage, bring at "forced sale" a price sufficient to pay off all three mortgages, because the first and second mortgages must be satisfied in full before the "third mortgage" holder receives anything.

Third Mortgage Bond. A bond secured by a mortgage upon a property which already has two other mortgages existing upon it and which mortgages would have prior claims upon the property and its earnings. (See "Third Mortgage.")

Third of Exchange. See "Set of Exchange."

Third Preference Shares. The English equivalent of the American" third preferred stock." Not very many such