Stock options trading – One of the largest London banks offered to guarantee a loan made to one of its customers for a term of a relatively few months”at a rate of 8% per year.
The security of this loan is very nearly equal to a deposit in the bank itself. In England, the main risk is devaluation of the pound sterling. In the best opinion in England this is not a likely eventuality, but it is a possibility. There is also the possibility that if a loan is made by an American group or person to a British firm, when the loan is paid off, conversion to dollars may not be permitted. The Bank of England, however, must approve all loans before they are made, and if this approval is secured it is likely that upon maturity the conversion to dollars will be permitted. This approval does not apply to deposits in finance companies, and this is, of course, the main outlet for the funds of the smaller investor.
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