Los Banos Rotary Club History
Stocks And Bonds Is Rotary Topic

Wall Street came to the cow country here Tuesday as Williams L. Warner, representative of the bond brokerage house of Bailey & Davidson Modesto, addressed members of the local Rotary Club on the subject of stocks and bonds.

With the world of stocks and bonds something of a mysterious entity to most of the "cow country" Rotarians, Warner's talk was both interesting and enlightening. He carefully explained the difference in the various types of bonds, emphasizing the characteristics of bonds bought for speculation and possible high profit, and those purchased as a dependable investment security; and the effect of the country's economic condition on the industries whose bonds are for sale.

As a general guide to investors, Warner said that prospective investors should first pick their industries, then the particular companies within the industry, after a study of the company's assets, capitalization and outstanding bond issues. As to industries, he pointed that certain materials and products are effected more by periods of inflation and deflation than are others. For instance, paper, oil and certain other products are enjoying increased use today, with consequent higher return to investors. Utilities—telephone, gas, electric, etc. are less effected by periods of deflation than are most other industries, hence offer increased security over a long period of years though interest and dividend returns may be correspondingly less.

For the inexperienced investor, Warner urged that they consult with an experienced and dependable investment counselor, who, by constantly studying and analyzing the market, is in a position to expertly judge and advise his clients.

July 20, 1951

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