LOST MILLIONS

Evening Post, Volume CXV, Issue 80, 5 April 1933, Page 7

LOST MILLIONS

FORTUNES THAT FADED HAVOC OF THE DEPRESSION EFFECT ON INDUSTRY

A fete in aid of a hospital held in a beautiful St. John's "Wood garden—a representative gathering that included leaders in nearly every walk of life., • Caruso singing in the drawing-room as a side-show; world-famed actresses presiding over stalls; and Edgar Cohen, who had organised the function, paying all the expenses so that the hospital funds could "receive the maximum bene- ■ £t. . ■ My thoughts turned back to this icene of other days, which I remember so vividly (writes Hubert O. Meredith, city editor of the "Daily Mail") when I learned that Edgar Cohen had crossed to the Great Beyond and that in his declining years his means were of the slenderest. . Why is it that in these days wo hear so frequently of similar cases—the millionaires of yesterday, numbered among the needy of today? The subject is not merely an interesting one; it is also a very important one in that, in many .instances, these millionaires were able to utilise part of their fortunes in fostering industries in their early stages of development, and so played a big part in our past industrial greatness. MELTED AWAY DESPITE CARE. Let me deal with some of the causes that have led to the evaporation of millions. In the case of Edgar Cohen, who during his lifetime was reputed to have made some £5,000,000, the explanation probably lies in his generous and extravagant nature. He never refused what'he believed to be an honest appeal for' help, and his expenditure, in view of his lavish method of living, must have been prodigious. He made vast sums and spent them, confident in his ability to make them again. Then times changed. His active -years were over, and he was left behind in the financial competition which lias grown so acute in recent years. Earning like a millionaire, he never gave his wealth the chance to accumulate. Tlie explanation'of his case isa simple one. But what of the other eases, the men •tfho by dint of ability, hard work, keen judgment, and good fortune (because, in every ease, this last factor must play a big part) have seen their carefully amassed fortunes melting away despite the care they have exercised? Many have suffered from the economic blizzard which,has proved so devastating in recent years. Take the cases of tho big iron, coal, and ateel magnates. Many of them in pre-war days invested their fortunes in their own vast companies, and year by year have seen the value of their holdings depreciate to almost vanishing point. DEPRECIATION. A similar story can be told of our former shipping magnates. The late Lord Inchcape, the world-famed head of the P. and O. Line, by spreading his investments, had not suffered as seriously as others, with the result that he left an estate valued at £2,000,000. It is,, believed however, that afew years prior to his death his fortune'was in the neighbourhood of £10,000,000 —a depreciation of some £8,000,000. Thei there was the fabulous fortune pf. r the.Jate S. B. Joel. In this case the 'slump in diamonds must; have led to a shrinkage of many millions in his fortune. . :

The late Lord Melchett provides another example. Here industrial depression must have played havoc with avast fortune. It is significant to note that these three cases cover the fortunes of men whose ability in their own sphere cannot be questioned. There was no suggestion of over-ex-travagant living or speculation. In each case the evaporation of millions was caused by general conditions. In this connection it must be remembered that holders of predominating interests in any particular industry find it almost impossible to liquidate their holdings when the downward turn starts, even if they so desire.

A case of a different kind was that of Paul Richard Kuehnrich, the Sheffield steel magnate, reputed at one time to be a man of colossal wealth. As a result of the depression in the steel industry he chose death rather than a life, of poverty. So far have only referred to the fortunes that have disappeared through no fault or, action of the former possessors. There are obviously many cases, where unsuccessful speculation was the primary cause. A striking case of this is provided in the life of the late Carl Hannau. ' LOST TWO FORTUNES. In the early days Mr. Hannau was one of the South African magnates. He returned to this country with a for-1 tune of well over £1,000,000, and quickljr lost it speculating in American securities. ' Nothing daunted, he returned to the Cape and proceeded to make another fortune. He was largely interested in tho Coronation Syndicate, the £100 shares of which at one time changed hands in the neighbourhood of £4000.

But his second fortune followed tho way of his first, and the final years of this man, who in his day had been 'the most lavish'spender and biggest speculator in Johannesburg, wore spent in a boarding-house with "sixpenee-a---liundrcd" bridge as the only remaining outlet for his passion for speculation.

Another operator who speculated in a regal manner was the late James White, who, after carrying out deals running into millions and being the possessor of -a fortune of £3,000,000, chose the hour and method of his own death.

One could almost fill n volume giving details of fortunes that have disappeared, and examples could be taken from every walk of industrial activity. We hear much of the vast fortunes made out of industry, but little of the manner in which these fortunes are subsequently utilised in . fostering tho same industries, unless, as has been too frequently the ease of recent years, we learn to our surprise that the millions have been lost. If wo; analysed the cause in many cases we should find it due to* the fact that a praiseworthy effort had been made to keep factories going and men in employment when the economic position did not justify it.