Show Business Business- Business 1940 and I and I 9 No Low 4 Low 4 Low Interest Rate Is Hard on Invest Fourth Fourths of six Ix articles reviewing 1910 business and forecasting probable trends in 1911 1941 By JO JOIN JOHN T. T FLYNN NEA Service Financial Writer riter From the standpoint of the Investor in investor investor in- in vestor the year ended and the year ahead are somewhat lar It has been a profitable year for many corporations and it has been an unprofitable year for others These two groups would cover those corporations affected by bythe bythe bythe the war business and those not affected save indirectly Some corporations getting war business have enjoyed a profits record far above last year This his is after taxes are deducted For instance they show a gain of 49 per cent in the third quarter over over ver the same period last year They show a gain gam of 79 per cent over last ast year in the nine months up to September 30 SOME SOl SHOW ACTUAL LOSSES On the other hand In the second second sec see ond group some group some corporations corpora corpora- while while a few show large profits like the petroleum industry industry industry indus indus- try a number like baking food products beverages drugs wholesale and retail trade show actual losses both for the third quarter and the year as a whole up to October 1 This however Is because the benefits of the war business that went first into the direct war in industries industries industries in- in have not yet percolated Into the others But there is a reasonable expectation that if the business does keep up this percolation percolation per per- will take place pace The plight of the investor is far from a happy one stated in terms of the return he can get on his money The average yield on the very highest grade corporate bonds bond only 26 per cent On long long te te treasury bonds it is about 19 cent and on term short-term tr treat St notes about 25 per cent 11 B Investors open their eyes eye a gasp a little when they see a a aft ri r. road equipment bond a a issue issue issue-go go for fr 2 per cent to 15 per cent tT is actually lower than gave gove ment meat bonds NO INDICATION I j OF BIG RISE The whole subject of taxes t n the uncertainty of war hang hang good deal over this security vestment field Taxes on coi tor rations have become prett ous For instance a large barge arge grof gr of corporations studied by b byj National City bank shows an aiT of all sorts of taxes taxes- come property etc of gent cent of net Income This me that over half haf of every doU dollar dolla r net income goes for taxes o off kind or another j Financial authorities seem feel that the low Interest fi fiare ra are a serious hindrance to tobi ness and that nothing should done to depress them further The question arises then then- theriS Interest rates as war ore ord multiply and business moves sJ tend to increase II This is a question being as by innumerable persons persons persons' oti U than business men in the real estate field fied I Of course an increased dem for money should shoud send rate rates But the pools of unused mor mo are so immense and the rate rat rates S Slow low that there does not seem seem be very much prospect for r ra rato n nto to rise to a point where their the would woud become serious or would woud affect rea real estate rates Next The Next The labor go business triangle ors 1 a r K 3 f f p 34 4 w s. s 1 1 w Despite great spending for defense and booming busine activity the plight of the investor is far from a happy on one stated in terms of interest he can get for his money i 1 |