Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1900-01-23

6uVEk CUU&Q % e8Al4y II
among FARMERS and yillasers. Then
the proceeds Of these sales could be
applied to bearing the burden Of the
cost Of maintaining and operating the
Detroit exchange. IN this manner
q favorable showing could be made
for the Detroit compa ~ so that in
experienced investors could easily be
Influenced into buying the stock. And
the scheme worked admirably, the
villagers swapping at the bait with
the same avidity that a Reuben buys
the gold brick" or the package Of
green goods"
The new State Telephone Company
was organized in February 9. 1897,
with a capitalization of 1000. 900. The
company was organized for the pur-
pose of establishing an Independent
toll line system throughout the State
of Michigan. and of absorbing or
building the necessary local exchanges
to compete with the Bell plants. The
ot0Sh was pldCCA I'll (AO uldIASs AS q
perfectly safe investment and the
financial prospectus showed that when
the company secured $500 subscribers
in small towns at an average annual
rental of $50 each it would have an
income of $500. 900; that only $780,
600 would be required to meet all pos
cihIa raoriromonfc honco fbora WOULD
be a balance of 500, 600, or IAN assured
10 per cent dividend" yearly. Il was
also stated that proceeds from stock
sales will be Immediately utilized in
the construction of exchanges and
connecting toll lines, and in s,.ri, man.
ner as to make the earning ability of
funds secured m at once. All
stock will be sold at it's par value
only" 1t was also stated that a net
annual income of $500, oo0' would he
received from certain toll stations.
making the total net earnings for
dividends $3.50, 000-an assured annual
dividend of Is per cent for sharehold-
ers."
The final chapter as outlined in the
press dispatches shows that the ''as-
sured annual dividend of is per cent"
materialized, and that the con-
iding shareholders did not receive all
OF the principal back to say nothing
of any interest for the three years
use of money.
After this company had been in op
GRAFTON for SINE months the Sault Ste.
Marie (Mich.) News pertinently
said: THE New State telephone COM
pany builds no exchanges on it's own
money. 1t trades it's stock for social
ed independent exchanges when the
people who have tried to make them
pay become tired of the effort and
are ready to sell out for anything, ever
for handsomely printed stock certifi-
Gates that have no value. Does any
reasoning person suppose these shrewd
people would be peddling to clerks,
seamstresses, fremen and policemen
on the installment plan Is per cent
investments with the Detroit banks
overlooking with money, begging in
vestments at four per cent?"
The good citizens of Michigan natur-
ally concluded that the Detroit tele-
phone company was not and never
had been a splendid success, either
from a telephone or an investment
standpint-though it had been a sue
cess from the standpoint of the pro-
nioters reaping a harvest al the ex-
pense of %coniding stockholders. And
they naturally concluded that the he
roic remedy applied to save the De-
troit telephone company was intended
simpy as a measure of relief to enable
the original promoters to unload the
stock voted to them before the bot