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All legitimate questions from Outlook readers about investment securities will be answered either by personal letter or in these pages. The Outlook cannot, of course, undertake to guarantee against loss resulting from any specific investment. Therefore it will not advise the purchase of any specific security. But it will give to inquirers facts of record or information resulting from expert investigation, leaving the responsibility for final decision to the investor. And it will admit to its pages only those financial advertisements which after thorough expert scrutiny are believed to be worthy of confidence. All letters of inquiry regarding investment securities should be addressed to
THE OUTLOOK FINANCIAL DEPARTMENT, 381 Fourth Avenue, New York
Income Tax Primer
HE Internal Revenue
100 Questions and Answers
on the Income Tax Law
upon request for literature Z-66.
10 State Street
Ten Eyck Building
Marine Bauk Building
Farmers Bank Building
Dime Bank Building
137 So. La Salle Street
St. Louis, Mo.
Bai of Commerce Bldg.
Kangas City, Mo.
First National Bank Bldg.
Short Term Notes
SAN FRANCISCO, CAL.
424 California Street
Railway Exchange Bldg.
ESTABLISHED 1865 :||
Abundant Security and
GOVERNMENT CONTROL AND RAILWAY FINANCE
While it is too early to state definitely swering inquiries from many readers as
the final form of guarantee of earnings that to the wisdom of purchasing standard Congress will approve, it may be assumed railway shares, we gave a list of twelve
for the present that each company
will be such shares that could be purchased for entitled to receive the
average net operat$1,000 at the prices of December 1. It ing income as outlined by the President. was pointed out that these shares would
This is very similar to the plan followed in probably sell lower, but nevertheless were
England from the beginning of the war. cheap and ought to appeal to the investor
But investors who now purchase railway willing to take a considerable speculative
securities on the strength of the proposed risk. In commenting on the financial situa
Government guarantee must take into contion of the carriers, we said :
sideration the earning power
of these com
panies after the war. It may be that the This great investment in rail transportation-a twelfth of our National wealth-is so large a part temporary war measure will become a perof the foundation of our National finance and Na
manent method of controlling the railways. tional security that its safeguarding at a time like
If the Government does retain permanent this becomes a matter of vital National concern, control of the railways, then the question The Government by reason of its control of railway
naturally arises as to what will be the afterrates under the Act to Regulate Commerce, its
war bargain with the security-holders. It control of railway labor under the decision of the
might be better or worse than the proposed Supreme Court in the Adamson Act case, its con
war guarantee. This investors must bear trol of commodity prices under the emergency au
in mind. thority granted the President, and its control of the money market through the Treasury Department, But if after the war the Government holds the railways in the hollow of its hand.
turns these properties back to their owners Adequate inland transport is as necessary to-day to be operated under pre-war conditions, as an army in the trenches; sound railway credit is
what will be the earning power of the the foundation of war finance. The Government
individual companies and what will be the has complete power to maintain both, and there is
market worth of their securities? In these every reason to believe that it will maintain them.
columns we have more than once expressed If this reasoning is sound, then the securities of
the opinion that the Government, through Annerican railways, now selling at the lowest prices in many years, present an attractive opportunity to its great power of regulation, will see to it the investor who is willing to assume a considerable that railway property and railway credit risk in the hope of making a considerable profit. are maintained in the future. But there A fortnight later the Government, as a
are some uncertainties that investors must war measure, took over the operation of the take account of. railways of the country, and the President The most perplexing problem, in our appointed as Director-General of Railways opinion, is that of labor. The carriers are the Secretary of the Treasury, Mr. William taken over by the Government with a staff Gibbs McAdoo. The President in his
proc of more than 1,600,000 employees. On the lamation recommended that the Govern trains there are 300,000 engineers, firemen, ment guarantee to the carriers a net oper conductors, and trainmen-represented by ating income equal to the average of the the four railway Brotherhoods. In addithree years ended June 30, 1917. If Con tion there are 1,300,000 other employeesgress puts the President's plan into law, the despatchers, telegraphers, machinists, carapparent result will be to provide during penters, accountants, clerks, track workthe war the same rates of interest and divi
ers, etc. dends that the carriers were paying in
The 300,000 trainmen in 1917 received 1917. It may be expected, therefore, that by Act of Congress an increase in wages the standard railway shares listed in The
amounting to about $60,000,000 a year. Outlook will continue paying their regular
Toward the end of the year they presented dividends.
demands for further increases in wages Because of uncertainty as to what terms
amounting to approximately forty per cent. the Government will propose in taking over
One of the first problems before the Directhe railways, their securities continued to
tor-General of Railways is the settlement decline during December, and on the day
of the Brotherhood demands. The presafter Christmas they touched the lowest ent pay-roll of the trainmen is about prices of the year. The President's procla
$450,000,000 a year, or an average of $1,500. mation was issued that evening, and on the
What, then, would happen to the 1,300,000 following morning there was an extraordi other employees? Their pay-roll now is nary rise in the market. The twelve differ
$1,500,000,000 a year, or an average of ent shares that could be purchased at the
$800. It would seem that these less well beginning of December for $1,000 declined paid employees are in greater need of an to $910 on December 26 and advanced to
advance in wages to meet the high cost of $1,031 following the announcement from
living than the well-paid trainmen. If the Washington. At the closing prices of the
fifteen per cent bonus were granted the year these twelve shares could be purchased
trainmen, it is plain that there would be an
urgent demand from the other employees We give the list of companies, with the
for a similar advance. This would raise prices on December 1, December 26, and
average from $800 to $920, and would increase their total pay-roll by nearly
$757 $81% If the Government gives the railway
workers a war bonus of as much as fifteen
per cent, the pay-roll will be increased by up-
wards of $225,000,000 for the period of the
war. With Government guarantees of net
earnings, such a large increase in the labor
cost would have to be met in considerable 47 measure out of the Government Treasury.
83% That this is not without precedent is seen 1024
by the English experience. Since England $1,000 $910 $1,015 took over her railways there have been three
Proceeds of bonds will
ITT ESTABLISHED 1865 ||||
69 103 87
10 South La Salle Street
“BIG BUILDING WITH
taught the gospel of Thrift.
Wisconsin Dairy Farm Mortgages
Government Control and Railway Finance
offer what the successful investor always de $190 a year. The same bonns for Ameri
mands-ample security and good returns. can railway workers would aggregate
These notes are secured by first mortgages on $300,000,000.
improved property, the ground value alone
frequently having a value greater than the During the war the bonus to the English total of the loan. After careful inspection and
investigation by our experts, we buy the entire
issue of notes in other words, back our
the country have formd these notes attractive,
because the original notes are delivered to bonus, the same method of meeting the cost them. The genuineness of each note is certified would be followed here under the Govern
by us, thus preventing forgery or over-issue.
Our profit is the commission we charge the ment guarantee.
borrower. But what would happen after the war if
This plan enables you to invest $600 or multi
ples thereof; to choose maturities and diversity
Write for our currezi investment list No. 104
Capital and Surplus $9,500,000
Member Federal Reserve Bank
ALWAYS WORTH PAR
An ideal war time in-
vestment based on an war will find themselves in a very precari
industry never overdone. ous condition, unless, as many experts be
Price regulation and taxation lieve it will, the present Government opera
do not depreciate the security.
Write for our Booklet "12"
MARKHAM & MAY CO., Milwaukee, Wis.
living costs came down
The Kansas Fields
have shown wonderful developments
information on this subject with list of the
principal companies operating in that State. them back to their shareholders—will
If interested we shall be glad
to send this on application.
A. D. CONVERSE & CO.
Commercial Trust Bldg.
Free Booklets for Investors
booklets and literature for the information of
“Bond Topics "-Issue No. 0-200. A. H. Bicktaxation, may be justified by the wider and
more & Co., 111 Broadway, New York.
The Kansas Oil Fields. A. D. Converse & Co.,
Danforth Farm Mortgages-List No. 58. A. G.
Markham & May Company, Milwaukee, Wis.
First Mortgage Real Estate Serial Notes. Investrailways must be of the highest character.
ment List No. 104. Mercantile Trust Company,
“ Partial Payment Suggestions”—Circular M-48.
John Muir & Co., 61 Broadway, New York, judgment of the present value of railway
Income Tax Primer, AB-2000, National City,
Company, National City Bank Building, New York
First Mortgage Real Estate Bonds--Circular No.
9987. Peabody, Houghteling & Co., 10 South La clean and efficient political administration, Salle St., Chicago, III.
NOT ONE DOLLAR LOST
IX SIXTY YEARS
Bonds write for Booklet and Investors' List No. 58.
Founded A.D. 1858
BY ROBERT H. MOULTON
nitroglycerine, may sleep in the submarine the peanut. The experimenters are raising PEANUT
torpedo which is to destroy a great battle the latter on the demonstration farms and ship, or it may send a half-ton projectile are producing better results every season.
flying forth from the mouth of a gun. So surprising has been the success of the The boll-weevil, as a blessing in disWe now find that the meal mixed with
experiments 'that the planters have begun white flour makes a palatable and highly guise, has redeemed the South from the
to look for the dark side of the silver lining. disgrace of being a one-crop country. Cot
nutritious bread, and that it may be used The price of peanut products has gone up
for crackers and cakes. Peanut buttei can ton is no longer autocrat. He has been
with all its companion foodstuffs. Will it dethroned by the weevil, and must now
take the place of cow's butter; and peanut come crashing down at the end of the war? take his place as merely one of a democ
meal, which is a by-product of the oil, How much danger is there from over-proracy, or perhaps an oligarchy, of crops, makes the best of stock food.
duction? among which the once humble peanut is
In addition to the direct profits, the pea According to one of our peanut experts, rising to unwonted prominence.
nuts leave the land better off than when there is little danger of surfeiting the In 1908 we raised twelve million dollars' they were planted. For, like many of their world with peanut oil and cake, because worth of peanuts. A conservative valuation
cousins in the bean family, they gather and the food value is such that there is a uniof this year's crop is sixty million dollars. deposit' nitrogen in the soil.
versal market for them. The South abounds Texas alone has two hundred thousand
In 1914 the United States imported in sandy soil that will produce little cotton acres. What is to be done with all these 44,549,789 pounds of peanuts and 1,332,108 or grain. If the peanut could submit specimillions of bushels ? Surely they are not all gallons of peanut oil from Marseilles, fications, it would ask for just such soil. to be sold on the street corners to our boys Delft, Hamburg, and other ports. The nuts Vast tracts where pine forests have stood for five cents a bag! By no means. In the brought $1,899,237, and the oil, which was may be made useful and valuable by plantfirst place, the product is of high food valued at $915,939, went mostly into the ing them with peanuts. The cottonseed value-higher even than wheat. The oil is manufacture of butterine and other lard mills have a capacity far beyond the availa better lard substitute than cottonseed oil. substitutes.
able supply of their raw material, and have It brings a higher price per gallon, and can On the strength of these things the mill therefore lain with cold furnaces for a large be made in the very same mills by the men experimented with peanuts. The re part of the year. But now that the machinsame machinery that used to turn out cot sults were so successful that the acreage in ery of these mills, with slight adjustments tonseed oil.
Texas increased more than 1,000 per cent that cost very little, can be turned into And who would ever think of a peanut in from 1915 to 1916. In that State the peanuts peanut-oil plants as they stand, they will connection with our munition plants? They and cotton, acre for acre, as far as the value naturally welcome a new industry that will seem as far apart as the North and South of the crops is concerned, are now running extend figures on the credit side of the Poles. Yet the peanut, in the shape of neck and neck, with the chances in favor of ledger.
Real Estate Exchange Building
Are You An
Investor ? During the past year the Financial Editor of The Outlook has helped hundreds of Outlook readers intelligently to solve their particular investment problems. Perhaps you are contemplating a shifting of your present holdings or have fresh funds to invest. In either case we shall be glad to give you specific information on any securities in which
you may be interested. This serv
1st MORTGAGE 6% SERIAL BONDS
$850,000 Directly secured by a ber 22, 1917. Interest payable May closed first mortgage on and November 22d. building and land in fee, in heart of Detroit down
Building-a twenty story office building, town business district
steel, concrete and terra cotta construcfacing on Cadillac Square,
tion of most modern type. Within a opposite Pontchartrain step of principal car and interurban lines. Hotel.
Amount Term Maturity Denominations
$ 20,000 2 years Nov. 22, 1919 $500-$1000
500 1000 56,000 5 years Nov. 22, 1922
500 1000 Novem 50,000 9 years Nov. 22, 1926
500 - 1000
“ Detroit's First Mortgage House
90L Griswold Street
would be pleased to receive your booklet, “ A Buyer's
ice is entirely
Mail This Coupon. Today
Lot No. 1.-Over one hundred designs, mostly
During a recent visit at a district court in New York the writer counted five applicants rejected within a short period, due to their complete ignorance of the simple information required of an applicant for citizenship in this country.
The judge, in a most sympathetic manner, asked questions in each case that should have been answered by any schoolchild who had studied even the rudiments of geography and civics. One intelligentlooking man, well dressed, and apparently the right kind to be welcomed in this country, was unable to state what body makes the laws for the Nation. He must have startled the judge, as he did the bystanders, when he admitted he did not know anything of the present conflict in Europe and was not at all interested in the outcome. His native country is fighting for its life on the side of the Allies.
Another, accompanied by a man who may have been a parasite lawyer who for a fee of some sort had guaranteed a free passage through the courts, failed miserably on his mental test, but, owing to the kindness of the Court, was given a second opportunity, this time showing an even, more complete lack of necessary knowledge, This man looked in vain to his companion, who finally gave up his appeals to the Court and took his client away. It did not require a keen observation to see that the reject was utterly downcast, probably unable to tell just why he was not admitted. He had an ardent desire to become a citizen, whatever were his motives. He had obtained advice in the wrong place. He may possibly have paid a fee that was to "guarantee the rest. He
gave up, dejected, and walked out of the court, possibly adding one more to the mass of malcontents, Anarchists, and others with grudges against the country. To the onlooker, however, it seemed that the kindly words of the judge should have encouraged him to make another effort at the proper time, and after proper and necessary study.
In the field of business we are seeing patriotic and successful effort being made by large and small companies and corporations to put into the minds of their employees the idea, the intention, to become citizens of this Republic.
The employers profited by assuring themselves of more contented help, and have made a distinct contribution to the country, not only in the citizens added, but in the attempt to introduce into the voting population a body of men who have been encouraged to think for themselves and to have sufficient regard for their new privilege to make an effort, at least, to avoid the evil of group voting and other sacrifices of that privilege.
The Y. M. C. A., by establishment of evening courses, is co-operating in New York vith the work done by the Mayor's Committee on Naturalization, by the eve ning schools in New York and elsewhere. The various Chambers of Commerce in larger cities are establishing schools and
The schools are doing their work. Where can the parent, foreign-born, more readily and agreeably obtain the fundamental knowledge of our institutions than from his child, provided the knowledge has been imparted to the child in the school?, Rea
Lot No. II.-Twenty good designs in fine hand-
272 x 4 yds, $20.75, 28.75, 31.50. All our regular stock of over five hundred designs at prices much below the current market prices.
Orders by mail given special attention. James McCutcheon & Company
Fifth Avenue, 34th and 33d Sts., N. Y.
CHILL IN LI
The “WHITE MOUNTAIN" Refrigerator easily leads all competitors. For years it has ranked first in the North, South, East and West. It is to-day and always has been recognized as America's ng is Greatest Refrigerator. Carried by leading dealers everywhere. Send for beautiful “ 1918” catalogues and booklets.
| MAINE MAN'F'G.