FINANCIAL DEPARTMENT (Continued) vestment of his mother's. We investigated the security in question-a preferred stock-and wrote him that if his mother could not afford to run risks, as he said, we should suggest her selling, for the stock was rated highly speculative. He had written that the last thing she was in a position to do was to speculate. Upon receipt of our letter he wrote us again, thanking us, but saying that a friend had advised his mother to hold the stock for a year longer and then sell, because it would very probably advance twenty points or more in that time; he wanted to know if, under the circumstances, we didn't think it might be wise to wait. In his first letter he had stated that he didn't want his mother to speculate; his second letter, in effect, asked our approval of a speculation. In other words, in the interval he had joined the army of optimists who find it so difficult to realize that in speculation the chance of loss is greater than the probability of gain. CHICAGO 105 So. La Salle St. NEW ORLEANS 602 Hibernia Bank Bldg. A reader in Canada wrote in to say that on an investment of $500 he had made a profit of $1,000 in the past six months. He had bought some mining stocks on margin, "and," he wrote, "if I, who know nothing about investments, can do so well, I figure that you who are in a position to know can give me advice which will make a lot more money for me." We remember seeing a cartoon some years ago of a crowd of men in a café, all well dressed and prosperous looking except one shabby individual who was reading the stock ticker over in one corner. The caption was, "Find the man who made a lot of money on his first stock speculation." Occasionally people ask us how they can sell some building lots which they own in some out-of-the way part of the country. We are sorry, but we do not know. Real estate is a local proposition, anyway, and, besides, it is outside the province of a financial department. We might, however, risk the following suggestion to people who are thinking of buying real estate: "Never buy land without seeing it first." To people who write inquiring how to raise capital to promote inventions, oil companies, new manufacturing concerns, and all kinds of new enterprises we are obliged to say we can offer no advice. Our function is to do all we can to help our readers with their investment problems; we can offer no advice in regard to speculation-except leave it alone and we cannot find lucrative jobs in the banking world for young men who desire to get their hands on the country's purse-strings. For instance, a woman wrote us from the Southwest the other day that, as the representative of a certain concern, she was making on an average $500 a month. She wanted to become a bond saleswoman and deal, as she expressed it, "not in hundreds of dollars, but in thousands." A laudable ambition, perhaps, but we cannot tell her how to sell bonds successfully, and the fact that she is a success in her pres ent position is no guaranty of success at selling bonds. It is a wise man who knows his limitations and does not overreach himself. This applies forcibly to investing, which is a business in itself, and should not be attempted by the inexperienced without the help of some one in a position to give them some protection against a false step. Speculation is an even more complicated business than straight investing; at best one needs good luck to be successful at it, and luck is never consistently good. The inexperienced speculator, or the man who speculates at long range, might better give his money to some deserving charity. We are impressed by the large number of inquiries that come in regarding the value of securities after the investment has been made. This is frequently a case of locking the stable door after the horse has been stolen. It often happens that after an investor has made the purchase he begins to worry about the ultimate value of his securities. There is seldom any necessity for haste in investing money. It is much better to investigate first than to be sorry afterwards. There are always plenty of attractive securities available, and the investor should beware of the salesman who tries to hurry him into buying a security by stating that the price will soon go up. This "hurry-up" method is a favorite one with venders of doubtful securities. In general, we think it advisable to purchase only securities which are listed on one of the principal exchanges. There is a distinct advantage in being able to secure a daily quotation on a bond or stock. The investor is thus always able to keep track of the current worth of his holdings, and he has always a market available in case he finds it necessary to sell. This, however, does not apply to real estate mortgages, which should be regarded as a permanent form of investment to be held until maturity date. We have frequently repeated the warning against endeavoring to secure too high a rate of return. We think it is a safe rule not to endeavor to secure a higher yield than the average current rates of money. Every prospective investor can easily ascertain current money rates from the reports of the daily papers. Where the current rate is ranging from 42 per cent to 5 per cent it is dangerous to endeavor to secure a yield of 7 per cent, as the high yield in itself indicates some doubt as to the status of the security. This of course is a general rule which has many exceptions, but it is a safe one to stick to for the average small investor. We often receive letters from persons who are worried because their bonds have declined a few points in the current quotations. If proper care has been made in the selection of the security to start with, there is no need to worry about daily fluctuations in the market price in the case of gilt-edge bonds These fluctuations are entirely due to the changing current rates for money. Where there is a heavy demand for FINANCIAL DEPARTMENT (Continued) money for commercial purposes, interest rates will rise and the current market price for bonds will fall. But the person who is holding for an investment need pay no attention to these fluctuations. They have no bearing on the intrinsic value of his security. Let us again emphasize the rule of not being in a hurry to make an investment, but of securing, if possible, definite information regarding a security from some one who has proper financial knowledge before the investment is made. Beware of making an investment upon the advice of a friend. Our mail indicates that this is a very prolific Perhaps we have overstressed the acter as to make us pardonably proud of the good sense possessed by Outlook readers. QUESTIONS AND ANSWERS Q. I have $3,500 worth of registered 31 pr cent United States Liberty Bonds. The taxexempt feature of these bonds possesses no advantage in my case, and I feel that my money should command a higher rate than 3% per cent. Would you advise changing these bonds for United States 4% per cent Liberties? A. The only advantage in holding the 32 per cent bonds is the taxexempt feature. These are therefore held chiefly by people of large income. Where this feature is not of importance we believe that these bonds should be exchanged for the 44 per cent Liberties. (Continued) so as to take advantage of the higher rate of interest. The security is the same in each case. The 44 per cent bonds are now selling about one point lower than the 32s. In making the exchange you would also, therefore, secure about one point profit. We also suggest that you consider the new Government long-time 44 per cent bonds which have just been issued. These are also selling a trifle below the 32 per cent bonds and are of equal security. In your case, it would seem that you are sacrificing interest by holding the 31⁄2s for the sake of the taxexempt feature, which you state you do not need. Q. Will you kindly give me a report on the present standing of the American Telephone and Telegraph stock? A. American Telephone and Telegraph stock is considered as an especially good investment stock because of the nature of the business and the great stability of the company's earnings. The report for the first six months of 1922 shows net earnings of $32,364,133, an equivalent of $5.75 a share earned on the amount of capital stock outstanding during the first six months period. This is at the rate of $11.50 a year per share. This company recently offered its stockholders the right to subscribe to $150,000,000 of new stock at par. Practically all of this stock has been subscribed for, which of course increases the total outstanding capitalization and makes a corresponding increase in the amount of earnings necessary to pay the present 9 per cent dividend. The report for the third quarter of 1922 shows earnings well in excess of dividend requirements. The business of this company is such a necessary and stable one that its net earnings fluctuate but little from year to year. The demand for new telephones is constantly increasing, and there is therefore every assurance that the company will continue to cover its dividend requirements with a satisfactory margin, even allowing for the recent addition to its capitalization. The report for the first six months shows that the company now has more than 210,000 stockholders, which is an indication of the wide popularity of this stock as a suitable investment for the small holder. The stock is now selling around 122, which gives a yield of somewhat over 7 per cent. Are You Building for "Sixty"? THILE working and earn W ing for today, every individual should also see to it that there is a surplus building up for the years of declining earning power which are sure to come. The Halsey, Stuart & Co. Investment Plan fits perfectly into such a scheme. It establishes a means of obliging the investor to save and invest regularly a determined part of his income then makes his savings grow remarkably through the process of compound interest. An Accumulation of $50,000 in Safe Bonds at age 60 or before is within the reach of men of even moderate income. Business men, professional men and high-salaried executives can set a much higher mark and build toward it with assurance. Our booklet, "A Sure Road to Financial Independence," tells how the Halsey, Stuart & Co. Investment Plan fits all ranges of incomes-shows how to apply it on incomes from $2500 to $50,000 a year. Let us send you a copy, without obligation. Write for Booklet OM-22 Tours and Travel THE BEST IN TRAVEL Raymond-Whitcomb Mediterranean 2 months of Winter Cruising through Summer Seas. Sailing from New York, Feb. 10, on S. S. "Rotterdam." Write for Booklet. South America 45 days-New York to New York. A brilliant holiday, a diversified Short Cruise including West Indies and the Brazilian Centennial. Sailing Feb. 3, on S.S. "Reliance." Write for Booklet. Round-the-World Sailing Jan. 9 and 16, on S. S. "Resolute" and S.S." Volendam." 125 days of highly enjoyable, expertly planned travel. Write for Booklet, rates, and ships' plans. Raymond-Whitcomb Mexico-For the first time in 12 years this big field of foreign travel in America is open. Booklet and complete information on request. California Hawaii - The Raymond Whitcomb Californi and Hawaii Tours embra e this year new features particularly attractive to discriminating travel ers. Europe-Special Tours to the Winter Resorts of Europe. Booklet on request. South America-Comprehensive Tours to the "Continent of Surprises." These Tours feature the salient attractions in the "other America." Japan-China-The ideal year to visit these individual countries. Tours from 2 to 4 months. Booklet sent on request. RAYMOND & WHITCOMB CO. 221⁄2 Beacon Street, Boston THE BEST IN TRAVEL Educat onal Tours to EUROPE. Summer 1923. Organizer of small party will be given free trip to Europe. Edu cational Tours, 160 E. College St., Oberlin, O FREE TRIP TO EUROPE will be given an organizer of a small party. Established 1900. BABCOCK'S TOURS. 13 Halsey St., Brooklyn. EGYPT and Mediterranean Lands Nile Cruise to Second Cataract in private steamer. Long Tour sails January 6 by ADRIATIC. Also Later sailings and shorter tours. Write for information to BUREAU OF UNIVERSITY TRAVEL 15 Boyd Street, Newton, Mass. Winter Tour to the Mediterranean Small private party with experienced leader. January to April. Egypt, Algiers, Tunis, Spain and France. HELEN G. SMITH, care Brown Bros. & Co., 59 Wall St., New York. GYPT, GREECE, and PALESE TINE, small private party sailing in February. Also IDEAL SUMMER TOUR of EUROPE. RESER European Tours, 171 S. Oxford St., Brooklyn, N. Y. Furope Summer 1923 Superb Routes. Experienced rship. Limited number. For details write rt H. Browning, 117 Elm St., Oberlin, O. Tours and Travel Hotels and Resorts Egypt, Palestine Large steamers throughout. Small groups, Sailings Jan. 17, $2125-Feb. 10, $1870- EUROPE 1923 Limited parties enrolling now. TEMPLE TOURS 65-A Franklin St. Boston, Mass. NEW YORK CITY Hotel Le Marquis 12 East 31st Street Combines every convenience and home comfort, and commends itself to people of refinement wishing to live on American Plan Health Resorts AWinter Tour Sailing Jan. 6, matic centers, easy reach of social and dra- Sanford Hall, est. 1841 1923 Egypt and the Holy Land; optional extension Around the World, or tour through Europe. Miss KATHERINE A. PANTLIND 110 Morningside Drive, New York City. FOREIGN TRAVEL SCHOOL FOR GIRLS January 17-June 29 Harmonizes travel and study. Rome, Florence, P ris, London, Edinburgh. References required. Price includes travel, chaperonage, instruction in language, literature, art, music and history. Write for prospectus to Miss HELEN UFFORD, Director, Park Avenue Hotel, cor. Park Ave. and 32d St., New York City, or to Mr. L. V. ARNOLD, Sec'y and Treas., 350 Madison Ave., Suite 1306, New York City. THE beauty, fascination, and mystery of the Orient lures visitors from all over the world to JAPAN The quaintest and most interesting of all countries. Come while the old age customs prevail. Write, mentioning "Outlook" to JAPAN HOTEL ASSOCIATION Care Trafic Dept. IMPERIAL GOVERNMENT RAILWAYS for full information Rates for a single room without bath and with 3 meals. $5-6 in cities and popular resorts, $4-5 in the country Hotels and Resorts BERMUDA The Ideal Winter Resort PRINCESS HOTEL BERMUDA Directly on the Harbor. Accommodates 400. San Ysidro Ranch Furnished bungalows of various sizes; situated on the foothills among the orange groves, overlooking the sea. Central diningroom, electric lights, hot and cold water. Good tennis court. Six miles from Santa Barbara, two miles from ocean. Booklet. Address MANAGER, San Ysidro Ranch, Santa Barbara. CONNECTICUT Wayside Inn NEW MILFORD, Litchfield Co., Conn. The foothills of the Berkshires. A restful place for tired people. Good food and a comfortable home. 2 hours from New York. Booklet A. Mrs. J. E. CASTLE, Proprietor. MASSACHUSETTS Maple Lodge home open to a few guests. Conway, Mass. A country Modern improvements.Quiet for work or rest. Dock Ridge Hall, Wellesley Hills, Ro drives. Our table a specialty. $15-$25 a week. NEW YORK CITY Hotel Hargrave West 72d St., through to 71st St., New York 300 rooms, each with bath. Absolutely Rates with Illustrated Booklet gladly sent upon request. KNOTT Management. HOTEL JUDSON 53 Washington Square adjoining Judson Memorial Church. Rooms with and without bath. Rates $3.50 per day, including meals. Special rates for two weeks or more. Location very central. Convenient to all elevated and street car lines. Health Resorts Spring days now! Come to Tucson Can you remember a sparkling spring day? Air like velvet. Flowers drinking in sunshine. Blue, clear skies. What wouldn't you give right now for such a golden day? Private Hospital For Mental and Nervous Diseases Comfortable, homelike surroundings; modern methods of treatment; competent nurses. 15 acres of lawn, park, flower and vegetable gardens. Food the best. Write for booklet. Sanford Hall Flushing New York "INTERPINES" Beautiful, quiet. restful and homelike. Over 26 years of successful work. Thorough, reliable, dependable and ethical. Every comfort and convenience. Accommodations of superior quality. Disorder of the nervous ayetein a specialty. Fred. W. Seward, Sr., M.D., Fred. W. Seward, Jr., M.D., Goshen, N. Y. Real Estate FLORIDA For Sale Ideal winter home, furnished. located on lake few miles from BARTOW. Large, airy rooms, sunporch, sleeping-porch, beautiful grounds, bearing citrus trees and small orange grove. For further particulars write 8,325, Outlook. FOR SALE or RENT Com pletely furnished modern 8-room house, garage, dock, boathouse, sleeping-porches (3-room cottage for help, now rented), 2 acres, 112 ft. frontage on Indian River. Will sell about half cost, rent $600 season. BLAIR, Cocoa, Fla., Box M. The Knickerbocker Every day from October to May in Tucson, Arizona, is a spring day. Chrysanthemums and roses bloom. Lawns Sorrento, Fla. All modern conveniences, are green. Children play outdoors. Half-Mile High Plateau Surrounded by lofty, gorgeously colored peaks, Tucson lies upon a half two bathrooms, sleeping porch. Ideal lo cation. Fine spring water. For quick sale, $10,000. Address owner, Box 94,City Point, Fla. MASSACHUSETTS and well-established fully equipped tea-room. Splendid opportunity for two friends. Address 7,947, Outlook. NEW HAMPSHIRE mile high plateau. It is a modern city FOR SALE Unusual opportunity-long of 25,000, with good hotels, reasonable rentals, golf and town clubs open to visitors, fine shops, schools and churches. From October to May the mean monthly temperature never exceeds 72° or falls below 49°. Little rain. No fog or winds. Reduced Fares on All Lines Through Pullman service to Tucson via Rock Island, Southern Pacific, and connecting lines, is available at reduced fares. Fifty-three swift hours from Chicago, or only seventy-three from New York, and you are where springtime is beginning. You Will Enjoy This Booklet The luxurious sunny days and revitalizing life in the open that you have dreamed about are described and pictured in "Man-Building in the Sunshine-Climate." For all who seek rest, recreation, physical up-building, or relief from pulmonary troubles this booklet will be of surpassing interest. Just send the coupon. TUCSON SITE FOR BOYS' CAMP FOR SALE OR LEASE, one of the most beautiful locations available on Lake Winnepesaukee, one-third mile of lake shore. Acreage to suit purchaser. Ideal layout of sand beach, pine groves, athletic field. Plenty of wood and timber. 8,312, Outlook. NEW YORK $500 Secures 80 Acres with 3 Implements, 60 bushels oats, 25 bushels pota Cows, Horse, Poultry toes, 12 tons hay, 3 tons fodder, firewood, about 75,000 ft. timber, 10 acres growing pine, 5-room house, barn; $1,300, only $500 needed. De tails page 80 Free Catalog. STROUT FARM AGENCY, 150 B M Nassau St., New York City. RHODE ISLAND Ideal country place, near Narragansett Bay. desirable for gentleman's summer home or clubhouse; just off main highway Providence to New York; attractive old house, broad porches, stable, 100 acres and fruit trees, J. W. S. LILLIBRIDGE, East Greenwich, R. L. |