Jasper County Democrat, Volume 23, Number 36, Rensselaer, Jasper County, 31 July 1920 — VALUE OF AUTOMOBILE STOCK [ARTICLE]

VALUE OF AUTOMOBILE STOCK

Investigated by the White County Farmers’ Organization. In view of the fact that perhaps $50,000 to SIOO,OOO stock in the Elgin Automobile company is held by Rensselaer and Jasper county people I and efforts have recently been made to dispose of more of this stock here, the following report of the investigations made by the “blue sky” committee of the White County Farmers’ association, as reported by P. R. Bausman, county agent, in last week’s Monticello papers, under Mr. Bausman’s signature, will be of interest here. This report follows complete as published: The Blue Sky committee of the White County Farmers’ association has been asked to make - a report on the reliability of Elgin Motor Car stock which has been offered for sale at S2O per share during the past few weeks by two gentlemen representing the\ Standard Bond and Investment company of Chicago. Due to many conflicting statements coming from different sources the committee floes not make a recommendation In the matter but will attempt to set out below the representations set out by various parties and prospective purchasers may then use their own judgment. Mr. W. T. Davis, manager of the Prairie Farmer Protective Union

says, in part, “A report which we have just seen in regard to this stock is to the effect that they have $1,500,000, the par value of which is $lO. They began selling this stock at $6.50 a share and have been selling it at a greatly advanced price without any justification apparently as this stock is not listed on the curb nor on the stock exchange.” He also says in his letter of july 14th: “We called up two brokers today who deal in unlisted stocks. One of them offers the stock at $8.78 per share and the other offers It at $9 per share.” A letter was also received from the E. McNeal & Company of Chicago, who are dealers in stocks, dated July 14th, in which they offer 50 share of Elgin Motor Car stock at $9.25 until July 16* On Saturday, July 17, Thompson & McKinnon of Indianapolis offered an unlimited supply of Elgin Motor Car • stock at $9.75. Representatives of the Elgin Motor Car company claim that the few shares of stock that find their way onto the market is not a fair test oy which to judge the value of any stock because these stocks are usually from people who have been forced to part with them or hdve been traded some worthless stock in their place. In a letter dated July 19th, Mr. C. S. Rieman, president of the com' pany, says in part, “The price of S2O per share has no relation to quotations made from time to time by brokers but is based on the earning power of the company. The par value of the stdck is $lO per share, and based upon earnings at the rate of 37 per cent of the entire outstanding stock for the first quarter of 1920, it is worth more than the S2O per for which we are selling it.”

In conversation their representative also said that the brokerage houses were usually unable to deliver this stock when an actual order was placed and quite often were unable to have the stock transferred on the books' of the company because of lack of ahy record of its having eVter been issued. The committee has spent considerable in collecting the information in this report and is reporting the facts as found without a recommendation, but will leave it to any interested parties to draw their own conclusions. h* . ll'