The Hawaiian gazette., 1910-09-13
zee HONOLULU w1poATTBR.


For city which boasts of such tinan.
cial perspicuity as does this one, and
for one which has continually invaded
foreign financial fields, Honolulu has
proven itself as easy mark for sure.
thing stock sellers and rank wildcatters
as could be desired.
1t is estimated that almost a million
dollars of good coin of the realm, which
has been honestly come by in these
Hawaiian Islands, has gone to the cot.
fers of the INSCRIPTIONS promoter who
belongs to a class peculiarly and
viciously American. This has had such
an effect on the local investment and
money markets that our own hard
headed business men who have devel-
|oped or searched out hona.fde indus
tries or developments on the mainland,
where Hawaii's surplus cash could
safely be placed, find purse strings
closed to them. This has happened so
Frequently of late that it is time the
business community put stop to it.
Oil has been the bane of Honolulu
5or almost year. There are almost a
iozen companies developing oil in Cali
;ornia, the. supporters of which are LOCAL
people who do not know a rig from a
lole in the ground, both very essential
hings to oil developing, but both en-
.irely useless without oil. Too many
people hake considered them the only
hings that are needed, and picture
pf a derrick with the assurance that
he company is "drilling,' is consid-
red sufficient indueement to invest any
mount.
There are some simple business rules
hat ought to be considered in invest
ng money in undeveloped companies
which even the business man nowadays
,verlooks in his haste to get rich quick.
The first of these, of course, is the posi-.
ion of the oil field where the company
going to drill; the formation of the
round; the nearness of other product
We wells; the trend of the oil strata,
nd dozen other things strictly tech
zeal. The average person is absolutely
Unfamiliar with these things, and, in
act, only engineers who have made
fe study of it know much. The best
hing to do is to pay visit to the oil
ED itself, by which one can obtain a
done and how it should be done. If
he visit can't be made, reputable
ngineer should be employed by the
respective purchasing hui to report on
he ground. That costs money, but it
ften saves money.
The second thing to look out for is
le transportation question. Warnings
this direction have constantly been
|tTan IN nd
ted. One company which was foated
ere and which contemplates drilling
as pronounced last week to be fifty
tiles from transportation facilities.
hat means that it will be FIVE years
efore the company can dispose of its
il profitably after it gets it. When
ne announcement was made. dozens of
eople who had invested heavily began
dig for information, stating that they
ad expected dividends at the end of
le year. They had vague idea that
he far-famed Lakeview gusher assured
lem profits. That phenomenal well is
hundred miles from that company's
round, and is as useful as a criterion
an extinct volcano on the moon. The
Dmpany's land may be, and probably
full of OIL
The third thing to look out for, and
very man can do it for himself, is to
re up the promoters and manners of
romotiOn. In this town thousands of
pillars have been placed at the solicit
ton of men with police records, to
HON suspicion might naturally attach,
ven if none could be fastened on the
ock they offered. The Advertiser was
allied knocker because it issued warn
gs against purchases of United Wire
SIS stock. A month later the whole
heme was exposed as a gigantic fraud.
But the promoter is best judged by
5 methods. In support of the argu-
ents CT one who has been operating
itensively throughout the Islands, a
lper has been forwarded to the pros
ective subscribers. This paper was
avoted to oil news, where descriptions
the Lakeview gusher and glowing
hcounts of the operations of the COM
lny in which stock was being offered
ere spread all over the page. On the
rength of all this, hundreds were in
ested in absolute disregard to the fact
lat the paper was printed by the com.
hny disposing of the stock for the par.
cular purpose of boosting it. Such
Joey is deserving of any misfortunes
at might follow. This is not knock
the companies which are exploited
it-some of them are known to have
reducing wells and the prospects of
hers are not so rosy-but it is con.
mnation of the procedure of invest.
S. For all the guarantee the investor
I'D, the stock might be worthless paper
id the company might actually own
land whatever or stand any chance
getting any. There was a company