and to lay emphasis on it, he might have made more headway. As respects this, let it be said clearly for La Follette, that he had and has grounds for his outcry; that he is sincere in making it; and that if he had the power, this condition would end. The leverage of private interest in government is an evil. There are special interests who not only have their representatives in the places of political power, but actually bend the machinery of government to their ends. And La Follette's whole career, as well as the history of Wisconsin under his leadership, is proof that he knows how to recognize this evil, that he would exterminate it, and that he would tolerate in the places of power only those whose sole interest is the public one. But this advantage that would flow from a bestowal of national power on La Follette, does not necessarily call for the organization of a new party. La Follette could accomplish it by gaining control of the Republican party. That is how he did it in Wisconsin. A FLEXIBLE CONSTITUTION PROPOSED was sufficient dissatisfaction against actions taken by the Supreme Court, to compose a vital issue. The last outstanding occasion was the action of the Supreme Court in upsetting the income tax law passed in 1894, which action obliged the country to wait for seventeen years, and to go through the cumbersome business of amending the Constitution, before it could have the income tax. During that period, a new party might have made headway on an issue of curbing the power of the Supreme Court; but there is no such popular feeling about the Court in 1924. On the contrary, there was a faith and sentiment about the Supreme Court most favorable to the continuance of its authority undiminished. La Follette suffered greatly through dramatizing himself in opposition to the Supreme Court. A voter looked at a photograph of the Justices in their solemn robes; he got the impression of venerableness from most of them, and of a grave dignity approximating venerableness from even the younger ones. He saw idealism in the bright eyes of the oldest of them, Holmes; humor, HE issue that was second in La geniality, almost a jovial quality in the TH Follette's mind was to from the Supreme Court its present power of declaring void statutes passed by Congress which the Supreme Court deems to be departures from the Constitution. As La Follette would have it: after Congress has enacted a statute, if the Supreme Court declares it void, Congress can thereupon pass it once more; and it will be valid. This means that a simple majority of Congress, 218 out of 435 members of the Lower House, and 49 out of 96 Senators, could do anything whatever, without regard to the courts or the Constitution. As to this one of La Follette's issues, not only did it have the effect that second issues always have, of repelling some who might come to a candidate on a paramount issue. In addition to this, there was little interest in this issue; and of what interest there was in it, the bulk was adverse to it. the broad brows of Butler and Sanford; he saw equal qualities of assurance and dependableness in Sutherland, McKenna and Van Devanter; forthright courage in the almost Andrew Jackson-like features of McReynolds; acute penetration and sympathy with progress in Brandeis. The voter looked on the photographs of the Supreme Court and saw all that. Then he turned to the campaign photographs of La Follette, some of which were not of La Follette at his best; he saw in La Follette something of that unusualness, that aberration from the conventional, which is frequently a deterrent from confidence in the average man's mind, the pompadour hair that suggests emotional excitability-the voter turned from one photograph to the other and decided to stand by what seemed to be the picture of greater stability, in a world where the agencies of unstability are already dis Here again, there was a time when there turbingly numerous and energetic. Foreign Government Bonds F Every month in this part of the magazine the WORLD'S WORK prints an article on investments and the lessons to be learned therefrom ROM the daughter of a widow the Investment Edi tor received a request for advice regarding the investment of $25,000. They had been advised, she wrote, by a "hard headed" man who had practically all of his money invested in French 8s, and who has great faith in them, to invest about $4,000 in Liberty bonds and the rest in foreign government bonds, so that the average rate of interest would be 7 per cent. "What do you think of foreign government bonds and of French 8s in particular?" the daughter asked. This raised a question on which the investment doctors disagree. Generally they do not recommend the high-yielding foreign government bonds for widows' investments. Yet Moody's ratings on the external loans of Netherlands, Norway, and Denmark, for instance, brought out in this country, are "Aaa"-his highest rating; and for those of Belgium, France, Japan, and Queensland, "Aa," the next highest; while the new German 7s, the Austrian guaranteed 7s, and several of the South American bonds in our market are given an "A" rating, which classifies them in the opinion of this authority as good investments. Other ratings correspond closely to these, although some authorities mark them "conditional," as a reflection of the difficulty in judging the value of such bonds as compared with local issues where the right of foreclosure to force payment exists. In the case of the German 7s issued in connection with the operation of the Dawes plan, the Wall Street Journal, at the time of the bond sale, said editorially that "the German bond is in comparably the best secured foreign issue in the American market." Subsequently, in answer to an inquiry, that paper pointed out that Germany's credit to-day is not so high as that of some other European countries, and classified these bonds as "a good business man's investment.” From a leading investment banking house that has had experience in handling foreign issues came this general comment in regard to them: The coupon rate on many of the foreign government bonds which were floated in the United States during and following the that time, the actual instability of European European War reflects the price of money at conditions, and the unfamiliarity of American investors with foreign government bonds and credit. As an added inducement to the American investor, special provisions were attached to these high coupon bond issues such as non-callability to maturity, payment at a premium, etc. Many of the causes which necessitated the high coupon rate and special concessions are rapidly disappearing, and this will tend to put the price of these bonds, where they are nonrate of interest which the credit of the country callable, on a basis which will yield only the of issue is entitled to under normal times. Where the bonds are callable it would tend to make it desirable for foreign countries to call their high coupon rate bonds, refunding them with very considerably lower coupon rate bonds. This situation offers an opportunity to the American investor who feels that the stabil ization of European conditions is reasonably well assured to discriminate among foreign issues dealt in in this country, and to acquire bonds which, if he is right as to European conditions, will give him a higher income yield on his purchase price than could be obtained two or three years from now. Replying to the widow's daughter, the Investment Editor wrote, "There are only two investment fields in which it seems possible to-day to get 7 per cent. return on one's money with a good degree of safety. Those are the foreign government field, about which you inquired, and the real estate mortgage bond field." Continuing, he wrote: "As a rule we would not advise the placing of all of an inheritance, such as your mother and you have in hand, in any one or two investment fields. Greater safety is to be secured by greater diversification, and there are risks in these two fields that are not found in some other fields-that is what accounts for the higher rate of return. "On the other hand, the writer is inclined to believe the foreign field offers some of the most attractive investment possibilities to-day in such bonds as the new German 75, French Republic 7s, State of Queensland 6s, Belgian Government 61s. But these are not securities that are usually recommended for a widow's investment. "In parenthesis we might say that we think your 'hard headed' friend would do well to switch from the French 8s, which can be retired soon by the French Government at 110, into the 71s, which cannot be retired before maturity in 1941. If the credit of France improves in the next several years, the 7s should sell far above the 8s. "Coming back to your problem, we think it would be well to place $4,000 of this money in Liberty bonds, as has been suggested, and if you must have 7 per cent. on the total, divide the rest between such foreign government issues as we have mentioned and real estate mortgage bonds purchased through houses of high standing and long experience in that field." There are ten foreign government and municipal bonds listed on the New York Stock Exchange bearing high interest rates that cannot be called for retirement before maturity. At this writing they are selling to give the following yields to maturity: In addition to these there are as many more foreign government and city bonds that cannot be called before 1934 that might be added to the list. Those include the Japanese 6s due 1954, callable in and after 1939 at 100, Belgium 6s due 1949, callable the same year at 105, and the Austrian guaranteed 75 due 1943, callable in 1934 or after at par. These latter bonds, however, can be redeemed for the sinking fund at par on any interest date. The German 75 due 1949 are redeemable at 105 for the sinking fund annually. An example of the effect on prices of the short experience that American investors have had with foreign bonds is to be seen in the Austrian Government issue, which was brought out partly in this country and partly abroad. In the London market the sterling bonds of this issue, bearing 6 per cent. interest, were selling around 92, to yield about 6.85 per cent. to maturity, when the 7 per cent. dollar bonds brought out here were selling at 94 to yield 7.60 per cent. to maturity. As American investors get better acquainted with foreign issues they will undoubtedly become more popular. But sight must not be lost of what has happened to Russian bonds and to Germany's pre-Dawes issues. The Corporation of Foreign Bondholders reports that nearly ten billion dollars worth of principal and interest is in default on foreign government issues that have been floated in the English market. Investors, therefore, should well diversify their selections in this field Betting on the Country's Future HAVE read your page in the WORLD'S WORK for several years and have come to think highly of your opinion. I would like to ask the following information if you are willing to favor me with it. "I have $2,500 which I would like to invest in the common stocks of some large, well-managed companies, dealing in staple articles of general use, which have possibilities of growth. Such companies as General Electric, U. S. Steel, National Biscuit, and similar companies were a few years ago. "I have in mind Allied Chemical, Westinghouse Electric, Pacific Gas and Electric, Southern California Edison. "Any information you can give me and any suggestions you care to make will be gratefully received." This letter came from a man in Massachusetts, where investors' thoughts naturally turn to stocks because of the high tax rate on bonds; but why should it not come from anywhere in the country? It shows a desire to make investments that have the possibility of growth, indicates an appreciation of the risk in such investing, and shows an understanding of the class of securities that should be chosen for such an investment-"common stocks of large, well-managed companies, dealing in staple articles of general use." This man believes what J. Pierpont Morgan said about the person who was a "bull" on the United States, and he had investment knowledge enough to know that he should distribute his bets on the future growth of the country. No criticism can be made of such investing when done by a person who can afford to run the risks of partnership in established businesses and who possesses the investment intelligence disclosed by this man. To start with, on a diversified investment of this character, he can get a present return of nearly 7 per cent. on his money. If a fifth of his selections should go entirely bad, or cease to pay dividends in times of depression, he would still be getting a return which would compare favorably with that of the best bonds. It is more difficult, of course, to choose common stocks that are not likely to go bad than it is to choose high grade bonds. For that reason those who cannot afford to take risks with their money and who need a fixed income from their investments to live on, should confine their investments to high grade bonds. In reply to this inquiry the Investment Editor wrote: It strikes us that your scheme of investing $2,500 by dividing it among the common stocks of five large, well-managed companies in various fields that seem to have possibilities for growth is one of the best plans that you could follow. In selecting five stocks for your purpose, it seems to us that your suggestions of Allied Chemical & Dye, Westinghouse Electric and Manufacturing, and one of the California hydro-electric companies could not be improved upon. In adding to this list we would suggest such a railroad stock as Southern Railway common, which seems to have good possibilities because of the great industrial expansion in the South, and American Tobacco new $50 par value common stock, which gives a return of more than 8 per cent. and also seems to us to have good possibilities ahead of it. Some reader might ask, "Is this not speculation?" It may be, but if so, it is legitimate speculation. Montgomery Rollins, in "Money and Investments,' defines speculation as "buying in expectation of a rise in value having no regard for the income-producing capacity." And investment, he says, is buying "with the purpose of obtaining an interest return upon the money; any increase in value of the principal being but a secondary consideration, but the safety of the principal a first consideration." to read the three pages.... first three BY CAMERON ROGERS W E DARE you to read the first three pages. Leaping like live things from a sufficiently arresting book jacket these words create in the mind of the casual buyer at a book stall a feeling of pleasure able unrest. He may not succumb at first; he may even go upon his way, at least for a few hundred yards; but in the end those startling words and the altogether too sinister figure staring, purple upon yellow, from that jacket, work their spell. He returns and buys and that evening devours not only the first three, but all the pages, with a feverish concentration that leaves him at bed time eager for bright light and reliable companionship. He resists with difficulty the shameful little voice that bids him look under his bed and peer into the recesses of the clothes closet lest the unpleasing individual of the jacket, in reality the greatest criminal of all time and the arch enemy of the white race, be subtly hidden in the shadows waiting to work his evil. In the end, he sleeps fitfully. But he is inoculated. His taste in fiction is crystallized at last. The romances of great criminals and greater detectives have claimed him for their own. And so they have claimed their thousands and tens of thousands. They have become a type of fictional literature as clearly defined as any other, the straight adventure, the humorous, the problem novel and the rest, and should one visualize these types as men and women standing together in a line, the one of mystery, somewhat dishevelled, a little obviously dressed perhaps and prone to a certain vulgarity of speech though he may sometimes be, stands out as not the least commanding of them all. His early tutelage, received at the nervously able hands of Edgar Allan Poe, sowed in him the seeds of a wide variety of astonishing qualities. "The Murders in the Rue Morgue" thrilled and horridly mystified our grandparents who must have inwardly repeated with a deeper fervor, "From battle, murder and sudden death, Good Lord deliver us" after a late reading, and "The Gold Bug" was obviously studied with care some thirty years later by the perfectly invincible Sherlock Holmes. Fitz-James O'Brien, a brilliant and imaginative Celt who came to this country from Ireland, published during the early 'fifties stories which further exemplified the growing interest which our type began to arouse. "The Diamond Lens" and "The Lost Room" may still be read with bated breath and here too may Holmes have profited. With this last named gentleman, our type reaches the peak of his early development. Now, when crime rides seemingly triumphant with science and invention at its elbow and is brought down at the end of three hundred odd pages only after the direst struggle, even now with all the added appanage of horror that comes from the misdirected use of lethal rays and invisible agents of destruction, the mysteries so calmly and inevitably solved by Holmes still thrill us as they did when years ago we sat shivering quietly over the "Speckled Band" or the "Musgrave Ritual." With his pipe, his quiet strength, his absolute om |