The sun., 1919-10-29
The Use of Capital.

directions in which care should be ex-
ercised by promoters OF companies for
industrial purposes the neglect or which
In the past in other directions has been
the source of heavy losses to the public
anc a deterrent to the private investor,
would say at once avoid good Will"
vendors interests" value of patents"
and such like items appearing as assets
In the balance sheet of any company
formed for industrial purposes. Such
enterprises, II confined to staple In
dustries In small markets, cannot be ex-
pected to yield profits which will allow
, of provision being made In anything like
reasonable period for watered capital
! Of this kind. What We want Is solid
progress and not wildcat schemes,
which when they result as they
| capital make investors timid and de-
prive other promising ventures run on
! SOUND lines of the financial assistance
to which they are entitled.
| No doubt / will be expected to say
something regarding the private indi-
| vidual. or the firm. who. unaided by
|; outside capital, except perhaps by bor-
rowings from his bankers. has brought
| some industrial enterprise or other to a
stage which calls for additional capital
in order to provide for an expansion
! which IL desirable in all respects from
his point OF view. In the past. when
/ cases of this kind were concerned. II was
perfectly natural that the owners should
desire to apply to their bankers for
loans rather than admit outsiders to a
share in their businesses, which NAV
have been built up as the result OF
their own enterprise and labor from
small beginnings and contain possibili-
ties Of future growth
Such persons have in the past IN
many cases been handicapped through
the absence OF any mutually agreed
upon system whereby their bankers
could obtain the necessary insight into
the working Of their business and be en-
abled to reach a conclusion as TO whether
and what advances could reasonably
be made to them allude quite az
OF the question as TO the financial, an6
since am concerned hero with the pro-
vision OF capital for Industries ! dc
not think II amiss to labor the point
that tho more that technical advice IL
sought and the moro builders up Of In.
dustries are content to follow the ad.
} vice Of those specially qualified to give
; 10 the more will capital be attracted
to Industries and a field for sound
investment be opened up for the savings
o: the people generally. ! need scarcely
say that, in addition to the technica
and financial advice TO which have
already alluded. It is Just as important
to consult the distributor before en-.
tering on any particular line OF pro-
duction. since, after all. the merchan,
is the channel through which the prod
ucts will have to find markets.
would indeed place this side Of tn,
question In the forefront Tho intens,
competition from overseas, which oul
, local manufacturers will have to face
must constantly be kept prominently II
view, and since, the consumers are evel
in greater numbers than the producers
contest will continually be waged by
the former to obtain the cheaper article
This leads at once to the fiscal side oil
the question. and as this Is a contro
versial subject I will confine myself e
saying that the accumulated expert
ence OF other countries similarly stu