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Show THE FINANCIAL SITUATION. An event which transpired in local financial circles during the week illustrates strikingly our article of last week on the business situation. This was the purchase by. one of the large life insurance companies of a million dollars' worth of water and sewer bonds of Salt Lake City. 'The bonds draw interest at 4 per cent per annum, and the insurance company was so eager to get them that it paid a premium of upwards of fifteen thousand dollars for them. There were several other bidders, among them some firms who heretofore have been able to get such bonds, both here and in other cities, at par. less a commission for disposing of them to others. The transaction shows that the stocks and bonds of Wall street are in disfavor with investors. The assets of the largo life insurance companies are being carefully scrutinized by the public these days, and it behooves the companies to make only such investments as are regarded with favor by the public; pub-lic; otherwise the result woidd be a loss of patronage. patron-age. People taking out life insurance policies will naturally favor the company whose assets are regarded re-garded as the safest. A catering to this same popular pop-ular sentiment is shown by the advertisement of another large life insurance company, which says: ''We have no industrial stocks or bonds in our assets." as-sets." This is another way of saying lliat it has quit Wall street entirely, and yet this company was one of the heaviest investors in Wall street securities se-curities a few years ago. Still another large life insurance company boasts in its advertisement that its assets consist principally of mortgages on real estate,, "seventy-two per cent of which arc guaranteed." guaran-teed." This is another way of informing the public that it does not invest in Wall street. When these large life insurance companies, with hundreds of millions of assets, managed by the ablest financiers in the country, drawing salaries far larger than that of the President of the United States, are so eager to deny any connection with Wall street, it is clear that they not only realize themselves the danger of such investments, but that they also realize that investors generally regard Wall street investments with disfavor, and they are using that argument to get the patronage of the public. It bears out our statement of last week that the era of "frenzied finance" has passed, and that the investing public must now have something some-thing whoso chief feature" is the safety of the capital cap-ital invested. What form of investment offers this feature, coupled with a fair return on the money, for the ordinary investor the man or woman of moderate means ? Such investors ' cannot buy municipal bonds, because they havo not money enough to take, an entire issue, and the large companies- will not part with them. ,When such bonds arc bought from brokers they net investors only about 3 per cent per annum, which is not enough to afford a living income in "these times of high prices. By the process of elimination there is just one form of investment in-vestment left which fits the requirements, and that is real estate. Money so invested in any fairly prosperous pros-perous community, and especially in a growing city like Salt Lake, is sure to yield a fair income, with an almost certain increase of capital. The eastern cities, even the moneyed centers, are experiencing the correctness of this view, and real estate has been steadily rising for some months. Such cities, however, cannot offer anything like the induce ments of the west, and eastern capital is sure to seek investments here in this line in the very near future. The bond purchase referred to above shows the faith which the leading financiers have in Salt Lake City, and indirectly it shows the faith of the public in it ; because such investments are made in accordance with public sentiment. This insurance company wanted an investment which would stand a close scrutiny by its policy holders, present and prospective, throughout the world. The shrewd financiers at the head of the company knew that the bond3 of Salt Lake City are regarded everywhere every-where as being gilt-edge, and in order to get them they paid a handsome premium for them. The wise investor will read the signs of th times in these transactions, that real es-'ate generally gener-ally throughout the country, and in Salt Lake City in particular, is coming to the front as an investment, invest-ment, and that it offers the safest and most profitable profit-able investment in the world today. |