STARR-BOWKETT.

Wanganui Chronicle, Volume LXXVI, Issue 17894, 14 June 1920, Page 5

STARR-BOWKETT.

To the Editor. Sir, —Your issue of this mornini 1 contained such a big “bite” that wondered whether it was Torn . “shark” or 'an “intending guinea pig!” One of those hogs to be fount in the deep and sometimes dirt; waters of “frenzied finance." I hoar tily joined in the family merriuieu caused by your correspondent's hu inorous reference to my meteor!, flight—one needs must laugh am love to live. Of course I .gave thos, details to emphasise the desperat, measures we had to take in protect ing the members of the old Starr Bowkett Society. Seeing that r< many of them drop into early declim and die I think that they should b, named “T. 8. Societies! I agre, with your contributor in his state ment that the success of a busines largely depends on the policy of th' management—but of that mor anon. I emphatically state that ; Starr-Bowkett Society which has t< commence liquidation within fifteei years (adolescent stage!) of beinj launched has not served its purpose and I venture to assert that were i canvass mace of the many hundred of late members of the Economic the Co-op., the People's, and Mr Tu ner’s society (a mixture of S.B. am interest-charging tactics) it wouli be found that quite 80 per cent would admit that the ventures wer a great disappointment, if not fail ure I note that “Inending Share holder” (he has my sympathy) con firms my contention that owing t the vast increase in the price of lan and cost of building the present I NOT a fortuitous one in which to at tempt to launch an S.B. Society. H gives it as the reason two societle are being wound up! To revert t the management of these affairs—why does your contributor attemp o place to my debit the onus of fail ure in one of the societies I wa but the humble and underpaid sec retary, generally supposed to do a he is directed by the Board. Surel he must be ill-informed, or he woul know that there were seven director in the People’s Society! Good men too, some of them. Why, its chair man for many years is none othe than the very capable allround oh gentleman who occupies so many o the highest civic offices the town ha to confer. Why not put some of th blame on the chief officer of th l company, instead of on the little bo, away down in the eighth position o the class Such a lot has been writ ten of “British fair play,” but it ap

t.vii ui diiusu Lrt.ii pitij, uut ii «*y pears to me that even in this most model little town there is plenty and to spare of the habit of hitting below the belt and kicking a man when he is down. But come on, ye guinea pigs! Are we downhearted? And now to refer to the last gibe of youi correspondent. I ask him, what is "current” interest? Does he refer to that given by our trading banks or by the Borough Council on deposits, or the interest on Post Office savings, or dividends of trading companies here? There are some of the latter—fairly big concerns—that have in their history lean years when no interest (or dividend) has been paid. However!! his question is a very thinly veiled attack on the Wanganui People’s Building Society and Investment Co., Ltd., of which I was secretary from its inception ten years ago until I was taken to the hospital nearly dead in August last. The main reason for there being hardly any open market for Its shares is the fact that when there were sellers I have had no trouble in placing the shares with other members of the company! There are several among the 170 odd members who recognise a good thing when it is pointed out to them, and were I to mention the names of only a few of

the shrewd men now buying shares it would be quite sufficient answer to “Intending Subscriber’s” silly attack. Quite recently one ot the leading financiers of the town began to acquire shares, and he is now prob--1 ably the owner of about 30 or more shares of £25 each. He came in from the outside. It would take up more space than I am justified in using ■' were I to go fully into the reason • why the company has not paid more ■ than 5 per cent. Briefly, it is because when the company started operations all but a fraction of its is- ' sued capital was locked up in longwinded redemption mortgages in the old society. That is to say, the capital has been coining in by drib.cts during the past 10 years, and as a matter of fact is not all in yet! It naturally took some years to hit "p a dividend on a sum approaching £lO,OOO and when the first dividend was declared the actual total of cash invested, was only about half tee above sum! That is nearer 10 per cent, than 5 per cent, on the working capital in hand. In addition to paying a regular dividend of 5 per cent, the balance sheets reveal that the company has a substantial reserve account, over £lOOO of which has been loyally invested’ in New Zealand Government inscribed stock and war bonds, not earning usurious interest. I may conclude by stating that 1 would be shirking my duty to my fellow members were I to retrain from giving them the following advise:— (1) Remember your unenviable position in the old Starr-Bow-kett Society. (Over £lOOO was forI feited therein by the unfortunates who fell ino arrear.) (2) Compare it with the present absolutely solvent and successful company into which you wisely transferred your interest. (3) Follow my example and do not part with a single share under par unless you simply cannot do without the money! To finance my boy Into business and thus give him an early start, I had to sell halt my holding. I still hold more shares than 90 per cent, of the shareholders —in fact. I believe lam among the first dozen, and 1 shall hang on io! them as long as possible. If I margive a straight-out tip, I would not take shares in any S.B. societies unless the promoters undertook not to go to allotment with less than applications enough to fill at least three or four groups of 1000 shares each, such groups to be under one management. I pay little heed to an- | nouncements of alleged improved rules or the fact that the Board s£ Directors may be the pick of the town. The Building Society Act overrides all rules, and they vary but little. The best of directors can do nothing unless backed by big membership and their cash.—l am, etc., HARRY STONE. P.S.—ln my first letter I did but broach the question of my objections to joining a S.B. Sociey—there a r e many more should your readers core to have them! —H.S. June 12, 1920.