N-30D: Initial annual and semi-annual reports mailed to investment company shareholders pursuant to Rule 30e-1 (other than those required to be submitted as part of Form NCSR.)

GLOBAL INCOME FUND 11 Hanover Square, New York, NY 10005 American Stock Exchange
Symbol:GIF

Semi-Annual Report
December 31, 1998


February 10, 1999

Fellow Shareholders:

It is a pleasure to submit this report for the six months ended
December 31, 1998 for Global Income Fund. The primary investment objective of
the Fund is to provide for its shareholders a high level of income and,
secondarily, capital appreciation. The Fund pursues its investment objectives by
investing primarily in a global portfolio of investment grade fixed income
securities. At December 31, 1998 the Fund had approximately 82% of its total
assets invested in fixed income securities with an actual or deemed investment
grade rating, and approximately 18% of its total assets in fixed income
securities with an actual or deemed rating below investment grade. At year end,
the three countries where the Fund has its largest investment allocations were
the United States (36.1%), Argentina (22.2%), and the United Kingdom (11.2%),
with the balance spread over 10 other countries and supranational organizations.
Additionally, the Fund uses financial leverage from time to time to purchase or
carry securities, although such financial leverage is speculative and increases
both investment opportunity and investment risk, and there can be no assurance
that the Fund will achieve its investment objectives.

Review and Outlook

Declining interest rates are most frequently associated with slowing
growth and rising unemployment, but that was not the case last summer and fall.
During this period, in response to distressed financial market conditions, the
Federal Reserve pre-emptively lowered its Federal Funds rate target by a total
of 0.75 %, but the U.S. economy grew at around a 4% rate, well above "trend,"
and unemployment fell to less than 4.5%. Additionally, the central bankers of 37
different countries engaged in 82 different interest rate reductions from
October 1998 through the end of the year. Likewise, international debt markets
experienced severe dislocation during the second half of 1998 and different
fixed income market sectors experienced widely divergent returns. For example,
for the six months ended December 31, 1998 the Lehman Brothers Aggregate Bond
Index and the JPMorgan Emerging Market Bond Index, Plus had respective total
returns of +4.57% and -13.42%. Reflecting these conditions, the Fund's total
return was -4.64% for the six months ended December 31, 1998 on a net asset
value basis.

Although several influences contributed to the disruptions in
financial markets, the devaluation of the Russian ruble and the Russian
government's de facto default on its debt were critical events. Dramatic losses
were incurred by participants in a variety of fixed income markets, including
banks and securities dealers. Losses at one large hedge fund required
intervention by the Federal Reserve to organize a private restructuring of the
fund. This period also witnessed an abrupt decline in equity prices.
The injection of liquidity by the Federal Reserve and central
bankers throughout the developed world restored financial market stability and
caused a significant decline in U.S. interest rates. U.S. government debt prices
also rose during this period due to their attraction as a safe haven during
times of turmoil. Between the end of June and year end, 30 year Treasury bond
rates fell by over 0.5%, and briefly yielded less than 4.75%. Shorter term
assets, such as Treasury notes maturing in two years, declined briefly by almost
a full percent, to as low as 3.75%, as investors sought safety and liquidity,
and anticipated additional Federal Reserve easing. Since late autumn, as
financial markets have recovered, and the domestic economy has continued to
expand, interest rates have risen moderately. While the issues which made 1998
challenging for international investors have not disappeared with the turn of
the calendar, a number of financial markets have demonstrated greater stability.

Within the United States, when the Federal Reserve was lowering
interest rates during the fall, the economy





grew at a healthy 3.7% annual rate. The economy remained strong in the fourth
quarter as well, growing at a robust 5.6% rate. Ironically, with inflation, as
measured by the Consumer Price Index, up only 1.6% over the last year, and
rising only 0.8% in the fourth quarter _ the lowest in 40 years _ the 4.75%
Federal Funds rate is still somewhat restrictive by historic measures, despite
the recent reductions. Additionally, the $70 billion Federal budget surplus also
exerts a fiscal drag on the economy, yet the economic expansion continues. Thus,
the impact of traditional monetary and fiscal policy on growth has been muted in
the current environment, and no one explanation for this is entirely satisfying.
Many factors, notably declining import and commodity prices, high levels of
industrial capacity, and increases in productivity have contributed to the
persistence of the expansion. Nominal yield levels on U.S. government securities
are low, but real returns are attractive, especially compared to other developed
countries. The limited supply of Treasury debt is a positive for the market, but
the demand from foreign investors is difficult to gauge given the potential for
Japanese repatriation and international portfolio rebalancing into the Euro.

Globally, the interruption of the dollar's three year strengthening
trend versus the Japanese yen and most continental currencies (now the Euro) was
the most significant development in the second half of 1998. The advent of the
Euro as a reserve currency, and the economic unification of much of the
continent should be positive for growth, and favor a strengthening Euro. We are
concerned that many European countries are experiencing slowdowns due to
declines in manufactured exports to less developed countries, which may
contribute to a weaker Euro. Economic performance has been mixed in Asia, with
South Korean markets recovering while the Japanese economy remains mired. The
recent strength in the Japanese yen and stock market may well reflect technical
circumstances, such as repatriation, rather than the economy responding to
government reforms or stimulus. The ultimate impact of Brazil's loss of reserves
and devaluation is uncertain, but it will undoubtedly retard growth throughout
South and Central America in 1999. 10% Dividend Distribution Policy Continued

The adoption by the Fund's Board of Directors in June 1997 of a
managed 10% dividend distribution policy continues to be well received. The
policy is intended to provide shareholders with a stable cash flow and reduce or
eliminate any market price discount to net asset value. The monthly dividend
distributions of approximately 10% on an annual basis of the Fund's net asset
value will be paid primarily from ordinary income and any capital gains with the
balance representing return of capital. For the six months ended December 31,
1998, actual distributions were 5.61% (equivalent to 11.22% annually) of average
net assets with approximately 76.75% derived from net investment income and the
balance from return of capital. We believe shares of the Fund are a sound value
and an attractive investment for income oriented portfolios.

Reinvestment Plan Offers Important Advantage

The Fund's current net asset value is $6.09. With a recent closing
market price of $5.19 per share, we believe this represents an important
opportunity to purchase additional shares at an attractive discount from their
underlying value. The Fund's Dividend Reinvestment Plan is particularly
attractive because monthly dividend distributions are reinvested without charge
at the lower of net asset value per share or market price, which can contribute
significantly to growing your investment over time.

We appreciate your support and look forward to continuing to serve
your investment needs.

Sincerely,





Thomas B. Winmill Steven A. Landis
President Senior Vice President