How to Have Become a Millionaire
At intervals far too long, we receive from CARL ROSE, who illustrates this department, an example of his prose.
Dream Street may be the poetic name for such thoroughfares as Broadway, Hollywood Boulevard, the Rue de la Paix, or even Red Square. For my money, Wall Street has clear and undisputed title to this appellation, and I have the pamphlet to prove it.
Standard & Poor’s Corporation is a large outfit dealing in financial statistics and investment advice. Its reputation is impeccable and its credit rating excellent. For a century it has kept its feet firmly on the pavement, and if its corporate head is occasionally enveloped by passing pink clouds, that is where the head of an up-and-coming investment advisory service should be, for in passing pink clouds may be found many green dollars, and the farther past the clouds, the greater the number of dollars.
Well, this Standard & Poor’s Corporation has become interested in my investment potential, and appeals to my cupidity by mailing me many fascinating bits of literature. On page 12 of the aforesaid pamphlet is a captivating table which details the procedure by which I might this day be rolling in wealth if I had begun an investment program with a mere $99.90 back in 1915. Indeed, I’d have been enjoying my riches for a full fifteen years, because the table ends in December of 1945, long before the bull markets of the fifties. My fortune would not be a puny million dollars either, but a full, round, whopping $70 million, and even in these inflated days, a fellow could do a lot with that kind of money.
For reasons I shall soon make plain, I cannot go all the way with Standard & Poor’s, but if they would allow me, I’d like to tag along on that retrospective road to riches, if only in a fractional way.
A hundred dollars back in 1915 was too steep an ante for me. My allowance was about a penny a day, an income augmented by very occasional finds of pennies, or even nickels, when my eyes were kept assiduously on gutter and sidewalk, as they usually were. Coins were sometimes fished out of subway gratings when I was lucky enough to possess a long stick and a mouthful of chewing gum. There was a pretty penny — in a good year, up to eighty cents — in hanging around the telephone booth in the local pharmacy, answering its ring, and summoning a neighboring flat dweller with whom the caller desired to chat. Tips for this service ranged from one cent to as much as a dime, but this enterprise was dominated by bigger and more ruthless businessmen, some of whom wore long pants.
Altogether, I might have scraped up $5 — that is, if I abstained from lemon jawbreakers and two-reel feature movies for an entire year. Yet such deprivation should have been easy for one whose hindsight was fixed on a day three decades in the future.
So the time is January, 1915, and I’ve roller-skated all the way downtown with my $5, and here it is, Standard & Poor’s, and where do we go from here? We go into automobile stocks, selling at 2.7 per share. We’re out of automobiles after a year with S25.72, and we jump immediately into steel. After eighteen months, we have only $31.12, which hardly seems worth while. So we go back into automobiles. (They have now risen to 17.3 per share. Those Marmons, Appersons, Pierce-Arrows, and Locomobiles were riding high!) There we stay until November, 1919, by which time our balance stands at $100.05. That’s what we should have had in 1915. It looks like slow going, but in the market, one needs patience and faith as well as money. It’s been barely five years, anyway. For the next two years we’re in department stores ($148.13); the following two, in public utilities ($168.20); we are back in automobiles for a scant nine months ($557.22); and for a few years in agricultural machinery ($1459.20). Those five dollars are beginning to look like something. Thirteen years have passed, and I am subwaying to the Street instead of roller-skating.
In December, 1927, we put our hoard into mail-order merchandising. Things are moving more rapidly now; less than a year later, the profits ($3967.78) are back in utilities. In September, 1929, we’re out again ($7898.08), and a good thing, too. But that little recession need not have stopped anyone with the courage of his hindsight. We ride out the storm snugly in gold stocks, and by June, 1932, we have $11,384.87 and arc really beginning to roll.
After a year in metal fabrication ($72,599.75, and what a year that was!) we go back to automobiles again, or their parts and accessories. This brings us to $159,118.19, and two thirds of our journey is behind us, with ten years of the big money still ahead. We step into copper for thirteen months ($344,321.19), after which we switch to airplane manufacturing, netting us only about $50,000 profit (the stake is now $395,065.25), but it’s better than a savings bank. In November, 1938, our interest is in air transport ($596,526.48), and in 1940, we’re back on the ground in cement ($625,488.67): then we’re air-bound again for $1,371,249. It feels good to be a millionaire, but Standard & Poor’s still has a couple of coups up its sleeve. In July, 1943, wartime shortages notwithstanding, we’ve invested in tires and rubber; all but $58.57 of the resulting $1,613,087.46 is put into department stores, and in December of 1945, after thirty-one years of shrewd trading, Standard & Poor’s has me sitting pretty with $3,501,673.55, except perhaps for a bit of trouble with the Internal Revenue Bureau, and such technicalities as brokers’ commissions, which S & P’s doesn’t mention. I’d just as soon let those sleeping dogs lie too. All in all, it’s a pretty good return for $5, and I’d have had the past fifteen years for gorging on lemon jawbreakers and seeing on television all the old movies I missed as a boy.
A dream millionaire is grateful, unlike a real one. For thirty-one years I’ve played the game of hindsight with Standard & Poor’s in their arena; would they join me now in a field of my own choosing? This one is faster — only two days yet requires about the same capital; $2 plus admission fee plus carfare, and S & P’s could even save on the latter by using roller skates. The profits are bigger, too.
I mean betting on the horses at an ordinary pari-mutuel track. We follow the same rules in this game, although I can almost hear one of the business-school graduates on the staff remark that a large amount of money bet on a single horse would drive the odds down to negligible proportions. Well, I ignored technicalities when I was playing their game, and they ought to do the same in mine. Let’s be good sports about it.
The time is not important. Any two days will do. I picked Saturday and Monday, June 4 and 6, at Belmont Park, because I happened to see those particular charts when I was setting out old newspapers for the trash collector. My eighteen horses, in the order oi their running, were Zambra, Budnose, Julitta, Princess Roussel, EI Esp’tador (that’s the way the newspaper spelled it), Ooweekin, Royal Native, Discard, and Tarot for Saturday. On Monday they were John T., Blue Blood, Benguala, Ranger, Table Hopper, Shield Bearer, Tooth and Nail, Tinkalero, and Sid Old Boy. Only three were real long shots—Julitta at 17.65 to one, Blue Blood at 30.05 to one, and Ranger at 12.70 to one.
Now, had Standard & Poor’s placed their $2 on Zambra’s nose, then parlayed $8 of the $8.20 profit on Budnose in the second (the odd twenty cents could have gone for a hot dog), which won at 2.25 to one, and so on, through the nine races, they’d have finished the day with $364,688.10. This is a fair return for $2, but not yet comparable to the $3 million-odd they made for me. As in Wall Street, patience is needed. They will be richly rewarded. In Monday’s first race, they become millionaires with $1,294,642.40. If all goes well, and in our realm of hindsight all certainly does go well, they will have cleared a very respectable sum by the end of the ninth race. For thirty-one years, Standard & Poor’s guided me through their passing pink clouds into my could-have-been Easy Street, and so they are now welcome to every penny of the $114,196,319,982.50 that they could have taken home from Belmont Park.