Chapter XXIII - Bonds As Investments Page 02
Bonds, like wheat, have their selling prices quoted from day to day, and they are equally a thing of purchase and sale.
There are banks and brokerage firms that make a specialty of bonds, and most of these houses are entirely reliable; still, the novice in such things would do well to investigate for himself before investing in any bond recommended by any seller.
It is the purpose of the seller to sell; it should be equally the purpose of the buyer not to be "sold."
Our government, state and municipal bonds speak for themselves, and in the main require no examination as to the security, though there have been cities and even states that have defaulted in their payments.
Bond houses and banks of established reputation cannot afford to deceive; they receive their compensation in the way of commissions on sales, and their characterization of the bonds may be accepted without question, for they invariably investigate the bonds, before they lend their names to them by offering them for sale.
If there is any doubt in the mind of the would be purchaser as to the character of the seller, that should be the first thing investigated.
What the buyer must satisfy himself of is:
1. Who is the seller? 2. What do the bonds represent? 3. Are they negotiable? and 4. Can they be sold again for about their face value?
Every one who has saved money, it is to be supposed, has a bank account and is acquainted with the president of his local bank. When in doubt, the advice of such a man may be of great help.