American Agriculturist 
THE FARM PAPER THAT PRINTS THE FARM NEWS 
agriculture is the Most Healthful, Most Useful and Most Noble Employment of Man.”— Washington 
Reg. U. S. Pat. Off. 
Established 1842 
Hue 113 
For the Week Ending February 2, 1924 
Number 5 
Rather the Tortoise Than the Hare 
An A. A , Wednesday Evening Radio Talk Broadcast From WEAR 
iHE American Agriculturist has asked 
'me to say a few words regarding invest¬ 
ments and the pitfalls in the path of 
the inexperienced buyer of securities. It 
timely subject in view of the exhorta- 
By GEORGE T. HUGHES 
Investment Editor of “American Agriculturist” 
there is generally some reason for the high yield 
which you ought to know. It may be lack of 
marketability. Other things being equal you can 
per cent. High grade bonds such as the law allows get a slightly higher return on a security not 
the savings bank to buy return 43^ to 5 per cent, easily saleable than on one that has a ready 
to thrift heard on every side. Few people Sound investments outside the strictly legal class market. For instance, a leal estate mortgage is 
L have impressed upon them the advantage may be had to yield 5 to o ]/2 per cent and reason- usually not saleable. To get your money >ack, 
mg money. I hey may not 
filling to practice thrift but 
lo not dispute its desirability. 
; other hand, after the money 
ice saved, the average man in 
[rate circumstances has only 
and many times totally 
leous ideas as to the best way 
ke care of his savings. Per- 
it will help to summarize 
mdamentals of sound invest- 
the first place then, the smaller 
[capital the more conservative 
] be jyour investments. A man 
[$1000 cannot afford to take a 
which could properly be 
jned by a man with $10,000. 
[a man with $10,000 likewise 
exercise more care than one 
I $100,000, In a general way 
|arger the return the greater 
lisk. There are exceptions to 
Irule but they are few and 
inexperienced investors are 
I in a position to recognize 
jiese two points are all impor- 
apd it is right here that so 
of answering inquiries from prospective ably good securities may be bought to return up It has in the past proved profitable to be a partner 
[tors time after time I am told that the writer to 6 per cent. When you go above 6 per cent in the telephone business by holding telephone 
; have a large return because he has there is some reason that needs to be carefully stock and we judge the future by the past, 
a small amount of money. No doc- examined before you commit yourself. Under- There are other exceptions which I will not take 
For small stand I do not say that there are no safe invest- time to name but the important point is that 
always be ments returning above 6 per cent. I do say that these are exceptions and not the rule. There is 
* no legal or moral obligation upon 
What Do You Want? 
F OR nearly a year now American Agriculturist has been cooperat¬ 
ing with the broadcasting station WEAF, owned by the American 
Telephone and Telegraph Company, in an experiment to find out how 
farmers could best be served in the way of radio programs. In the morn¬ 
ing at 11:50, in cooperation with the United States Department of Agri¬ 
culture and the New York State Department of Farms and Markets, 
market reports are broadcast, and every Wednesday evening at 7:50 
P.M., we give a farm talk. The speakers—the best that could be 
obtained in America—have covered every side of farm thought and 
problems. 
Now here is our problem. City folks respond constantly with 
thousands of letters, written to the broadcasting station, about what 
they want and do not want on radio programs, with the result, that 
they are getting what they want. On the other hand, farm people as 
usual are writing very little, with the natural result that the programs 
of all the stations are prepared more from the wishes of the city people 
than they are of farm folks. We get some response, but comparatively 
little. We know that the number of radios is increasing in the country. 
They are worth more to the farm people than anyone else, but not if 
the programs are not suited to your needs. 
Won’t you write us then your radio experience? What changes 
should be made in the programs? Can you get WEAF? Help us to 
help you.—The Editors. 
you have to wait until it matures. 
For this disadvantage, if it is a dis¬ 
advantage, you are entitled to 
compensation in the shape of a 
higher return. 
I find too great confusion in the 
minds of many people as to the 
difference between a stockholder 
and a bondholder. I am asked 
many times if this or that stock is 
a good investment. Now a stock¬ 
holder is a partner. He is entitled 
to his share of the profits, if there 
are profits. If there are no profits 
he goes without. He takes the 
risks of the business and all busi¬ 
ness is accompanied with risk. 
Again, generally speaking, com¬ 
mon stock is a speculation and not 
an investment. The exceptions 
are stock in corporations with a 
long record of successful operation 
and conservative management 
which has enabled them to pay 
dividends on their stock regularly 
for many years. An example of 
such a stock is that of the Amer¬ 
ican Telephone & Telegraph Com¬ 
pany which operates this radio 
station over which I am speaking. 
could be more unsound, 
ps the first consideration must 
[v and a high degree of safety 
not go with a high return, 
[ember too that the rich man 
[versifying his investments can 
pread his risk that even if one 
lem does go wrong no great 
comes. The man of small 
is cannot practice such diver¬ 
sion. Look at it another way. 
per cent on $1000 is $50 a 
Seven per cent on $1Q00 is 
|a year. The difference is $20. 
much quality do you want to 
me for $20 a year? 
[condly there is no such thing 
isolute safety in investments, 
[nearest thing ’that comes to it 
United States Government 
• If anything deserves to be 
• absolutely safe it is an obliga- 
of the government of the 
[ed States. Aftter that, safety 
[relative term. As I have al- 
said you can best measure 
I y by the return that is offered 
our money. Just now govern- 
securities return to 4>’<t 
On George Betts’ farm near Boonton, N. J., radio fills the milker’s ears with melody 
while the milker fills the pail with milk. Why not place a head-set over the cow’s ears 
so she can get some of the melody? It may make her help fill the pail! 
directors to declare dividends un¬ 
less they are earned, and to pay 
dividends out of capital instead of 
out of earnings or out of surplus 
is illegal. A bondholder occupies 
a very different position from a 
stockholder. He is not a partner. 
He is a creditor whose claim must 
be met as long as the corporation 
is solvent. From the investment 
point of view the bondholder has 
all the advantage. 
How shall these principles be 
applied to the choice of invest¬ 
ments? Probably the simplest 
course when one is asked to buy 
some security about which the 
prospective buyer is in doubt is to 
ask advice and ordinarily the best 
place to get investment advice is 
the bank with which you do busi¬ 
ness. The advice of a banker is 
generally sound. Bankers make 
mistakes like other men. No one 
infallible but the mistakes 
(Continued on page 108 ) 
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