How to save money

Chapter 12: ACID TEST FOR BONDS

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About This Book

The whole round world is gradually becoming economically literate and self - reliant, because sound ideas of economic foresight are everywhere being spread. The U. S. Ambassador to Spain reports, for instance, that the “mañana” spirit (“put it off until tomorrow”), which has been one of the time - honored economic hindrances in Spain and Spanish - American territory, is now disappearing.

ACID TEST FOR BONDS

What might be called an acid test of the reliability of a bond is a satisfactory answer to the following questions:

(1) How many times on the average have interest charges been earned annually in the last five years?

(2) For how many years has the corporation paid full interest on its funded debt without default?

(3) Is the bond I intend buying followed by other strong bonds for preferred and common stocks?

(4) What is the record of dividends paid on its preferred and common stocks during the past seven years?