"A New Plan by Old Interests."

Stock Profits

WITH

BOND SAFETY

This unusual statement is literally and conservatively true of Lacey Profit-Sharing Bonds owing to the singular conditions surrounding the lumber and timber industry and our long and peculiar intimacy with them.

LACEY

PROFIT-SHARING

BONDS

are a new type of investment which enable the average and small investor to turn to account our experience and uniform success in timber investments, as men of very large means have done and still do. (6 per cent interest plus profits; 1st Mortgage Bonds.)

In Denominations of
$100, $500, $1,000
Early application advised.

LACEY BOOKLET T-208 WILL COME
BY RETURN MAIL. WRITE.

LACEY TIMBER CO

332 South Michigan Ave., Chicago

For 37 years the name of Lacey has
been synonymous with conserva-
tive success in timber investment.

which were well known on the financial market, undoubtedly had a hand in the composure of the Stock Exchange during the weeks when actual war with Germany seemed to be impending. Recognition of them still left open for consideration the question whether even supposing immunity from financial panic and industrial collapse on the outbreak of such a conflict the country might not nevertheless be confronted with such reaction from its recent prosperity as should change the whole aspect of things. No doubt the action of the financial markets had not foreshadowed such a change; yet the possibility that financial affairs might move differently, simply because a nation had ceased to be neutral and had become a belligerent, was uppermost in many minds. Such considerations undoubtedly bring the question into the domain of uncertainty and conjecture, whether our government's departure from neutrality will not plunge the country. into financial reaction and adversity. But we are not without some precedent, even of the past three years, to which we may look for light.

OUTBREAK of war in 1914, and Ja

Japan's Experience

pan's announcement of her participation in it, hit the Japanese markets hard. In the two weeks after July 31, such Japanese export staples as hemp and straw goods fell 40 per cent in price. That country's silk producers, like our cotton producers, appealed hysterically for a government loan to support prices against the panicky decline. Acute apprehension existed as to the fate of merchants whose goods were on the way to Germany when war began, but were not yet paid for. Import of iron and other metals ceased; the country's total foreign trade in August decreased fully one-fourth. Since Japanese bankers refused to export gold when Europe was calling on its Eastern credits the foreign exchange.market became unworkable, nominal rates running violently against Tokio. The government had to issue its own obligations in London to take up maturing Japanese railway notes. At home, extremely tight money prevailed, with the bank rate 81⁄2 per cent and the stock exchange closed. Here was the case of an actual bellig(Continued on page 92)

Judge: "Well, this business of selling direct-bymail throughout the country is surely very popular with the public."

Lawyer: "Yes, but some of my clients say that in the interests of local merchants, the States ought to find some way to check it." Judge: "I don't see why they should-check it or how they can do it. Selling merchandise is an interstate business. I can sell and you can buy in the best market wherever it is. What can a State do about it?"

Lawyer: "You're probably right, I'll admit. The States can't very well put the 'kibosh' on legitimate interstate business."

Judge: "Certainly not. The States cannot hold up arbitrarily any direct-by-mail transaction, nor can they tax life-insurance premiums thus sent by mail.'

Lawyer: "How's that?"

Judge: "Policies are written for people, 'direct,' all over the country, and have been for years. The United States Supreme Court has decided unanimously that life-insurance premiums on such policies are exempt from State taxes. The usual license-fees and charges also do not apply. All this helps policyholders.'

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Lawyer: "Oh, you refer to the Postal Life?" Judge: "Yes, that Company hasn't any agents

and never has had. The applicant deals direct, personally or by letter. The method is good common sense as well as sanctioned by law."

Lawyer: (laughing) "Guess you're right. I wrote the Postal once myself just to find out how the Company did business, but never followed it up."

Judge: (laughing) "I go you one better; I not only wrote them, but took a policy nine or ten years ago and have carried it ever since."

Lawyer: "How's the cost?"

Judge: "Lower than in other companies for the same kind of insurance-legal reserveand besides that they give me a free medical examination each year just so I can keep in trim.'

Lawyer: "That's pretty good. You live in Idaho and deal with a New York company by mail. Did you ever look the Company up?"

Judge: "Only to know that it is chartered and licensed by New York State, whose laws are very strict, but I called on them when I was East last June. They've now gone into their new building on Fifth Avenue."

Lawyer: "Have they? Believe I'll write them to figure on a policy for me."

Judge: "Don't think you could do better. Life insurance without agents is a distinct public service. The point is made, and I think it is a good one, that the Company is subject to the United States Postal Authorities. The Postal simplifies the business, saves you money, safeguards your health and will treat you right in every way. I'd take another policy myself if I hadn't passed the age limit."

Call at the Com

In your letter be sure to give :

(Continued from page 90)

erent, exposed to attack by German ships and saddled with the cost of a military campaign. Up to that point, Japan's experience was what might have been expected. But the interesting fact is that the later experience duplicated our own revival of prosperity. As early as September, 1914, Japanese newspapers reported "business adjusting itself to the new conditions"; "panic evaporated"; even the "war risk" on the India route reduced from 10 per cent to 1⁄2 of 1 per cent. As for 1915, we are told by the Economic Annual of the Japanese Government's Finance Department that active business had then returned. This publication spoke of the prosperity of the foreign export trade; "large sale of munitions to Russia and the other Allies; increase in exportation to India, the South Seas, and Australia; the flourishing condition of our shipping business"; an "international trade balance very favorable to this country," and a "marked increase in our specie holdings."

Deposits in the banks of the Japanese cities rose during 1915 from $391,500,000 to $518,000,000; outstanding notes of the

$4,097,000. Money grew easy; export trade for the year increased 16 per cent over 1914, and the excess of exports over imports reached the highest figure in the country's history. Prices on the reopened stock exchange advanced; a speculation for the rise almost as violent as our own prevailed during 1915 and 1916.

In this case of an actual belligerent, individually engaged in military operations against Germany, an ally by treaty with the most powerful of the European fighting states, the course of financial and economic events, from July, 1914, to the present hour, was almost identically what it has been in the United States-even to the extent of a great break on the Japanese stock exchanges when Germany's "peace proposals" suggested early termination of the war. The most obvious explanation of this result is that, after Japan's short Asiatic campaign had been successfully concluded, she enjoyed all the advantages of prosperous neutrals.

It might possibly be answered, if we should attempt to draw inferences as to our own country's probable economic experience in case of war with Germany, that Japan's security arose from her extreme remoteness from the European area of war; that she is not within reaching distance of a German submarine; that by far the greater part of her ocean commerce consists of trade with Asia, barely 16 per cent of it being direct exchange of goods with Europe and even the large munitions shipments of Japan to her European allies being sent to them through Manchuria. The United States, on the other hand, is nearer by thousands of miles to Germany by the available ocean pathway. The German Admiralty has taken particular pains to prove that a German submarine can reach our ports. Of our export trade in 1916, 70 per cent went direct to Europe, thus traversing the possible field of submarine activities. Have we, then, any right to draw conclusions from the experience of Japan?