| OCR Text |
Show WHY SHARES ARE I OFFERED FOR SALE In the January, 191C, Issuo of "Invest For Profit," was published tho following orticle, 'entitled, "Why Shares Aro Offered." This article Is about tho best answer to tho question ques-tion often raised by the average uninformed un-informed man: "If your proposition Is so good, why do you come to mo with It? There are plenty of rich men who would take it all, If it Is as good as you say." Why Shares Are Offered. Persons who havo not nad tho opportunity op-portunity to learn tho fundamental principles that underly tho employment employ-ment of capital often wonder why shares In a corporation nro offered them. Particularly do they wonder why all such shares are not taken by largo capitalists, Instead of bolng offered to so-called small Investors. Dy analyzing the following facts, tho answer will bo mado quite apparent: ap-parent: In round numbers, our wealth U now about $260,000,000,000.00. Our money amounts to about $4.-000,000,000.00. $4.-000,000,000.00. Our population Is about 100,000,-000. 100,000,-000. Wo have, therefore, about $2,600 of wealth to vach person. Wo havo about $40.00 In money to each person. Has the answer been suggested? It must bo clear that we havo very little money In comparison with our wealth. Also that wo create wealth faster than we create money. And that money Is moro liquid circulates moro freely than other wealth. Tho tendency or the possession of money Is ephemeral; of other property, prop-erty, continual. Most persons havo approximately their sharo of money, but few havo their sharo of other property. Thcreforo, some people havo more than thoir sharo of other property, but a proportionate sharo of money. The larger capitalists aro the ones who havo moro than their sharo of other property, but not a proportionate proportion-ate sharo of money. Tho millionaire does not carry a million dollars around with him; neither does he havo It whero ho can lay his hands on It. Ho has It Invested In other property, prop-erty, In companies, where It Is work ing and earning moro money for him, which ho in turn puts to work in a similar way to earn moro money for him. Did ho not do so, a very small handful of men would havo n 1 tho money, and tho rest of us only fragments frag-ments of property. Tho big capitalists are not, therefore, there-fore, always In a position to Invest heavily In an enterprise, no matter how good It may be. Were tho capitalists ablo to Invest In new industries, as popular opinion has It, thero would bo few shareholders sharehold-ers In companies, and theso fow would be the capitalists. The capitalists aro shareholders In practically all companies, but they aro seldom heavy shareholders. They havo their Investments scattered In many companies. Uusally when a rich man dies and an Inventory of his wealth Is printed, It contains a long list of companies of all kinds In which ho was a shareholder share-holder a few shares hero, a fow hundred thero, and a fow thousand elsewhere. Theso Bharos had boon acquired from time to tlmo as ho had liquid wealth with which to acqulro thorn. Thero was no time, perhaps, at which he could havo bought all tho sharos, or a majority of them In any company, no matter how much bo may havo deslrc-d to do so. When a new enterprise Is formed to conduct an enterprise, It needs money. Whatever elso It needs to conduct its business, it must havo money. A part of its shares may bo given In exchange for property to bo used In Its business, but It must havo money, and to get this It offers Its shares to tho public. Wo have seen that tho bulk of our money Is in tho hands of tho small holdors. To get monoy, thoreforo, It Is logical logi-cal that tho company should offer Its shares to the small holders of monoy, to small investors; nnd when it comes to furnishing actual monoy, tho capitalists capi-talists are of this class also. Thoy aro long on other property, but unusually un-usually short on ready money. The Standard Oil company Is perhaps per-haps tho best paying company In our country, and Mr. Itockorfollor our rlchoat mn. Yet he owns bu a small part of Standard Oil. When he set out to swing that concern In-. to tho saddle of success he did not havo enough money to do It, and bad to lot others havo shares In his company. com-pany. The result Is the Standard Oil Is mode up largely ot small shareholders share-holders who are hanging to their shares and reaping tho reward of courageous Judgment. Tho Tonnsylvanln Kallroad shares arc an excellent Investment, yet they i are In the hands of over one hundred I thousand persons, of whom not a fifth llvo In the state of Pennsylvania I Tho Vanderbllt family nro sup-.posed sup-.posed to be the dominant power in J tho New York Central lines, and rich I enough to own the entlro system. Yet I In spito of the desirability of tho shares, the recent inventory of tin estate ot Cornelius Vanderbllt showed show-ed that ho owned less than one-fiftieth of the shares, Tho same conditions prevail In all the older, better and moro desirablo companies. If It is so In these old nnd sensoned companies, why should It not be true In younger companies, new companies? Tho fact Is that liquid wealth, monoy, Is so scattered, so shifting, that It cannot bo otherwise thnn true. , Don't condemn a company because you aro given the opportunity to buy a few shares In It. Tho capitalists nro given the same opportunity, and they may be more fortunnto to tho extent of buying more shares than you can buy, but tho chances nro that ho can not buy all the shares that aro offered, no matter how much ho may desire to do so. Tho thing for you to decldo is whether It Is a company, nn Industry, Indus-try, nn enterprise, in which you desire de-sire to own a part. It It Is, don't condemn it because you nro given the opportunity to buy a few shares rather thank your lucky stars that you havo the opportunity. Remember that nil big things created cre-ated by man had small beginnings. Simply see to It that the beginning Is right, then pitch In and help build. 'i. Howards for successful building are great. Great rewards do not come to tho timid. Invest For Profit, Jnn., 191C. |
