[503] Cf. Laughlin's Principles of Money, p. 73.
[504] The main modern type of loan for non-business purposes is the public loan for war purposes, or to meet fiscal deficits. In the case of war loans, the emergencies are often so great that the rate of interest makes little difference.
[505] No longer true of Europe, probably, since the huge war debts have been incurred.
[506] The interest so defaulted is cumulative, like a preferred dividend, for years after 1909. Wall Street speaks of this issue as a "half-bond."
[507] Supra, chapter on "Origin of Money."
[508] "It is needless to say that Government bonds always rank as the very highest class of collateral, and the banks require no margin on such security." Pratt, Work of Wall Street, 1912 ed., p. 287. This, it need not be said, is not always true!
[509] Veblen has elaborated the doctrine that stocks and bonds are much the same. Cf. the discussion in Meade's Corporation Finance of the relation of junior bonds and preferred stocks in reorganizations.
[510] I do not accept the imputation theory, or the capitalization theory, without qualification, except as static first approximations. Values of "factors of production" may easily become, and do become, in large part independent of their "presuppositions," Cf. the chapter on "Dodo-Bones", supra, and the chapter on "Economic Value."
[511] This would seem to be Davenport's view. See his article in the Quarterly Journal of Economics, Nov. 1910.
[512] To a high degree, "good will," trade-marks, etc., are bankable assets.