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Show WHEN SIGNALS ARE SET AGAINST YOU Danger Signs Given by Bankers People With Money to Invest Warned Against Ways to Lose It The Lure of "Easy Money." If you were an engTiieer on a railroad you would not intentionally in-tentionally pass safety signals set against you. To the expert e'ticcd investor there are similar signals for safeguarding his i investments. Some of these signs of danger, issued by th-1 Public Service Committee of the State Bank Division, American Bankers Association," in conjunction with the Better Business Bureau, are briefly indicated here: . PROMINENT NAMES Promoters know that the names and endorsements endorse-ments of successful men carry weight. They are often used without authorization. authori-zation. The pnudent investor will look 'befond names and will investigate. THE "GROUND FLOOR" An op poatunity to "get in on the ground floor" often turns out to be the same sort of opportunity which the Proverbial Pro-verbial spider extended to the fly. INSIDE INFORMATION "Inside tips" are usfuolly expensive pieces of misinformation. When used as "confidential information" to influence in-fluence the small investor they are generally of spurious character. THE FICTITIOUS ADVANCE Professional Pro-fessional promoters often arbitrarily advance the prices of the shares they sell as their campaigns gain headway fo create buying excitement and induce in-duce new buyers to get in before the next rise. Such price advances are li'itificial, usually employed merely to "speed up" the unloading of shares. shar-es. THE TELEPHONE CANVASS Irresponsible vendors find it easy to work over the telephone to victimize incautious investors. The cautious ;investor will not enter into securities transactions by telephone unless he personally knows with whom he is dealing. THE UNSELFISH PROMOTER The promoter who "gives his services" ser-vices" in organizing a company or as an officer of it and advertises that he does so will bear watching. THE IRRESPONSIBLE GUARANTEE GUARAN-TEE Irresponsible sellers of securities secur-ities often "guarantee" certain profits, pro-fits, or even that they will buy back shares when the purchaser wants liis money. Promises of this nature na-ture are made to create confidence sand to lull suspicion. They should indicate in-dicate to the prospective purchaser a special need to Investigate. "REORGANIZATION" AND MERCER MER-CER Unsucessful companies forced forc-ed into "reorganization" often call upon . stockholders for ne(w funds. Response to such appeals often means merely throwing good money after ibad. A conspiouously fraudulent flevice has been the "meTger," by which a new company trading .upon fres-h prospects and promises, takes over the assets of an unsuccessful venture and issues new stock for old, provided the shareholder pays 25 per cent or so in cash. THE PARTIAL-PAYMENT PLAN This helpful method of selling se- curites has been much abused. People Peo-ple who prefer to buy securites out of their weekly ot monthly earnings, are sometimes victimized by vendors lot stocks 'v.hich have little or no value. val-ue. 4.11 honest securitie8 dearlers u-nite u-nite in v.arniSs the inrsJtor to buy l5n the partial-payment plan after making sure of the financial responsibility respon-sibility and standing of the firm with which he does business. THE APPEAL TO PREJUDICE A chief stock in trade of the unreliable unrelia-ble pomoter Is misinformation which lays upon the prejudices and emotions emo-tions of prospects. This style of promoter points out supposed "evils" ('.nd "special privileges" existing in (he world of "high finance." He may urge that his venture is a poor man's proposition, free from the "laiige underwriting profits which ,the big fellows get." Usually such sellers endeavor to throw suspicion on others to divert it from themselves. them-selves. FALSE SENSE OF SECURITY "Real e.tate the safest security on earlh," is the type of slqjan under which at. times unscrupulous oper-, tors endeavor to lunload property on persons who want to make an envest-nient, envest-nient, but not a poor speculation. '.Experienced opinion, supported bv 'impartially gathered facts, forms the janly basis upon which to buy real testate, especially when you cannot see it before you buy. - MINING FALLACIES Many mining min-ing ventures are honest but fail because be-cause the promoters are unable to finance the proposition through to a successSul conclusion. Many other mining 'promotions are not good Jprospects although they may be re-f.resented re-f.resented as such. If a small investor in-vestor wishes to buy mining stocks lie can do so by purchasing securities securi-ties of established mining companies iwith records of substantial earnings and of dividends regularly paid to stockholders. ! OIL RISKS To almost every one come opportunities to speculate in j oil schemes. Very often such offer-, offer-, ings are misrepresented. Usually they are sheer speculations, all the risks being taken with the stockholders' stock-holders' money, while the promoters pay themselves handsomely through stock sales, commissions, salaries or "organization expenses." The investor in-vestor who desires to buy mining or oil securities should iget facts and experienced opinion as to issues of established, successful oil companies. Even the legitimate mining or oil business Is speoulative and demand! for profits upon a sound combination of properties, organization, finances and management. INVENTION" DELUSIONS- The general public too often believes large profits are to be gained through patented processes or devices. Inventions In-ventions are a fasinating means for separating inexperienced investors from their savings. Even when practical from a marketing and man UacUiring standpoint, patents are usually us-ually only moderately valuable. The small investor cannot afford to take an "Invsr.tlon Chance" with his ,fund.3. |