companies, and in such cases the legal liability of such companies in case of loss of deposited valuables will be no greater than that of other storage companies which receive and store valuable goods for compensation. It will be apparent from a perusal of the regulations which have been imposed upon safe deposit companies by the New York statutes, the principal points of which will be mentioned in this chapter, that the purpose of statutory regulations with regard to safe deposit companies is the obtaining of security which has not been otherwise provided for; and therefore it may be assumed that the responsibilities of safe deposit companies (and companies organized for similar purposes) in the States which have made no statutory provisions with regard to them will depend entirely upon the dispositions and personal responsibilities of the proprietors. And this statement will be a sufficient reason for the cautious, if any, use of such companies. It may be, that, in the States the legislatures of which have not considered it worth while to provide for the safety of their citizens' valuables in this respect, there are no such institutions as safe deposits, and therefore no present necessity for statutory regulations. This is at least a charitable supposition, and if it be true, the citizens of such States will have the poor alternative of keeping their valuables as carefully as possible at their homes, and of depositing them in the vaults of the most substantial banks which can be found and which shall be willing to accept the charges.

In the State of New York safe deposit companies are regulated and restricted by statutes the principal provisions of which may be stated briefly as follows:

There must be at least five incorporators; the paid-in capital stock must not exceed one million dollars, nor be less than one hundred thousand dollars, except in cities having populations of less than one hundred thousand, where it may be ten thousand dollars or over; regular reports must be made to the superintendent of banks; and the provisions with regard to securities which must be deposited with the superintendent of banks are the same as have been mentioned in the chapter on trust companies.

Safe deposit companies are forbidden to loan or advance money on any property which has been left with them for storage or safe-keeping, and the stockholders are made jointly and severally liable for all debts of the companies to the extent of the par values of their shares of stock.

The companies have the right, in case the rent of vaults or safes shall remain unpaid for a period of three years, and upon giving notice by mail to the persons hiring the vaults or safes, to open the vaults or safes in the presence of the officers of the company and a notary public, and to place the contents in the general vaults, in order that the safes or vaults may be rented to other parties.

A properly arranged safe deposit, or the premises in which the business of a safe deposit company is carried on, may be described generally in the following manner :

The building is a strong and substantial one, which is as nearly fire-proof and burglar-proof as it can be made, and protected at all times by numerous reliable guards and watchmen. The main portion of the building is divided into a large number of fire-proof compartments, of sizes varying from small boxes for the reception of papers to large vaults for the storage of valuables of considerable bulk, each with its special locks and keys, and all separated from the offices and waiting-rooms by several massive steel doors which are situated at various places along the passage ways. All the locks and bolts are of the most powerful and approved kind; guards are properly stationed at all gates or doors; and various other precautions, such as pass-words, admission cards, requiring the giving of names, etc., are taken to prevent the entrance of such persons as may have no right to be upon the premises.

In addition to the precautions which have been mentioned in the preceding chapters for the careful selection of banks, savings banks, and trust companies, and which evidently will apply with equal force to the selection of safe deposit companies, an inspection of the premises should be made before deciding upon the particular safe deposit company with which to entrust the most valuable of one's articles of

property articles which, at the same time, may be of the kind which will be most likely to be stolen.

There are considerable differences between the plans and arrangements of the various safe deposits, as well from the point of view of convenience and personal liking, as from. that of actual strength and security; and the officers of safe deposit companies will, at reasonable times, cheerfully and courteously show their premises to intended patrons whose appearances shall be indicative of proper intentions.

The process of hiring safes or vaults of a safe deposit company is usually quite simple and direct. The person wishing to hire a safe, having made her choice among the safe deposit companies which are at her disposal, and having been introduced to the proper officers, selects her safe or vault; comes to an understanding with regard to the rental, times of payment, etc.; gives her name, address, and other required information or references to the officers; signs an agreement stating the term for which the safe is hired, the rental, times of payment, etc., if required; pays the amount of the first payment; and receives the keys, pass-words, and other instructions which may be necessary for obtaining admittance to the safes.

Because of the peculiar liability of safe deposit companies to the danger of robbery, it may be presumed that they will exercise extraordinary care, not only in the actual guarding of the valuable property which has been entrusted to them, but also in the selection of their patrons. Proper introductions at the safe deposit companies, when seeking to engage safes or vaults, will, therefore, be the means of saving considerable time and of otherwise facilitating the proceeding.

The pass-words and instructions for the purposes of admittance which are received at the safe deposits must be carefully and accurately remembered, for, at least until depositors shall become well known to the clerks and guards, any hesitation or forgetfulness on the part of depositors will tend to interfere with or prevent their free entrance to the safes.

It may also be remarked, although perhaps it is too evident to require demonstration, that the pass-words and instructions in question must be treated in all respects as confidential, and must not be revealed to any person under any circumstances.

THE

CHAPTER VI

THE GENERAL PRINCIPLES OF INVESTMENT

HE principles and methods of business which, thus far, have been elucidated in this volume, have relation chiefly to institutions which are commonly used either as mediums for the convenient transaction of business (banks and safe deposit companies), or as depositories for money while awaiting more permanent dispositions-that is as tem. porary investments (savings banks and trust companies). We have now come to the consideration of the more lasting and regular sources of income which, because they are intended to endure indefinitely, we call permanent investments, and which, since they are the foundations upon which our fortunes will depend, can scarcely be treated with too much care and diligence.

The word "invest " primarily means to clothe in or with, to cover with, hence, to protect with; it carries with it the ideas of security, comfort, and permanence, for our clothing protects us against the weather and affords us comfort during our entire lives. The words "invest" and "investment" are far too commonly used in the sense which properly belongs to the words "speculate" and "speculation," and the general failure to observe and recognize the wide differences between the meanings of such words is perhaps broadly indicative of the loose and careless spirit of the age.

To" speculate" signifies to spy out, to search for, to explore the unknown, hence, to experiment. The suggestion of chance and risk which the investor seeks, first of all, to