The Democratic advocate. [volume] (Westminster, Md.) 1865-1972, 1902-09-20
Beware of Promoters and Cheap
Stocks.


Stocks.
From The Wall Street Journal
Wall Street is usually regarded by peo-
pie not directly acquainted with it in one
Of two ways. It is conceived as kind Of
den tenanted by sharks, octopods, leeches
and other fierce animals who lie in wait for
the unwary stranger and devour him, or
else ii is looked upon as sort OF seTom
fiddler Ground whereon one may find
as narrated in the song gold and silver
lying loose, simply waiting to be picked up
by the casual stroller. In times Of de-
preston and more than ordinary political
excitement the former view is usually pre-
ferred, but for gear or two past the latter
has been distinctly the more common. And
upon its prevalence among the people there
have been built up two trades which de-
serve passing mention.
One is the wholesale peddling of shares,
fully paid and non -assessable' at few
cents each by means of flaming advertise
ments in the daily press, with glowing
promises artfulIy held out Of enormous
profits, illustrated BY familiar historic ex-
arnples. This is company promotion ssfor
the people, brought within the range Of
the most modest purse. No one need
hesitate to buy few shares. Sometimes
dollar viii buy 20 or 25we believe we
have even seen shares offered at one cent
apiece ! 1t is not uncommon for offerings
Of this kind to be made with the statement
that the selling price will be advanced on
certain date, and the sellers are appar-
emily not unwilling to place themselves In
the logically curious position Of begging
people to buy shares from them before the
price is advanced. Philanthropy of this
sort seems to be accepted by the public as
a natural virtue in promoters, for appar-
emily the scheme must pay or it would not
be SO continuously exploited.
Now the reasoning underlying this kind
of business seems to be that shares in
corporation, when fully paid and non-as
sessable, are attractive to every one be-
cause of the interest excited by the large
company promotions and the great specu
lation on the Stock Exchange in the last
year OF two. Moreover, when these shares
are offered at few cents each, every one
can become interested in corporation
and participate in the boom that all
corporation stocks are enjoying. "Stand
ard Oil stock has sold at $500 per share
and SO has Calumet Il Hecla; therefore
buy stocks in the Beaumont and Spindletop
Oil Refining Company at FIVE cents share,
fully paid and non assessable, or in the
Mexican Amalgamated Copper Company at
similar price and grow rich without la
Dor.
The other trade is that Of peddling
tips on the market One advertiser
viii assure you that g Ny clients all bought
st. Paul at such and such price and A.
G. P. at so and so. Were you on? Stop
specializing at random and take my service,
| do not guess. [ know what the market
will do tomorrow. Another viii say
IA certain low-priced stock will advance
20 points and viii not decline p points.
My clients will be duly advised when to
get aboard. Terms, SIS weekly" Another
will say 81 am in position to know
what Morgan, Keene and the Standard Oil
people are doing. Communicate with me
and | will put you next for share of the
profits And so on. This kind of bus
mess must also be profitable for those who
conduct it, for advertising costs money, and
plenty of advertising is being done.
Now, no sensible man supposes for
moment that first class business enterprises
need promotion on the basis Of haIf-page
or page advertisements offering stock at
few cents share. To any one of expert
ence it must be obvious that the chance
of making money by bying shares 50
advertised is infnitesimal. Furthermore,
it is if possible even more absurd to sup
pose that the secrets of the market are at
the command of advertising "tipsters'
who offer their information for a few
dollars week. A little thought should
convince any one of ordinary intelligence
that no one who really had valuable infor
nation would be able to peddle it in this
fashion.
And yet SO strong is the popular sup
position that Wall Street is absolutely
paved with gold that almost any kind of
sscheap-jack'' plan in accordance with
that theory will suffice to extract from the
pockets Of the public money that in almost
all cases has been very hardly earned and
saved with difficulty.
We do not suppose that the readers of
this journal as a whole need to be cautioned
against such schemes as these. Yet, from
inquiries were occasionally receive it is
clear that there is reason to fear that many
people are caught by bats only little
more artistic. We cannot too strongly adj
wise against parting with one cent of money
in these days for any but securities either
tried or proven, or clearly possessing actual
merit There has been no time in years
when it is so necessary to know values as
at present
Wall Street offers many opportunities to
those who know values and possess some
capital But until people learn that some
stocks are cheap at 5000 per share and
others dear at 2 cents per share, and until
people learn that those who really know
something about the market do not need
to peddle their information for living, it
is to be feared that much money will con-
tinue to be lost both in and out of Wall
Street.