2i >2 



THE INDIA RUBBER WORLD 



I \I \v I, 1910. 



whatever may be true of his heart. Mr. Horn said that 

 many - E the new companies had riol one rubber tree 

 planted. He mentioned a case where a piece of ground 

 hi d 1 e :n a :quired and a nursery of rubber plants formed, 

 and then the proposition was offered to the public for 

 about S, : 75.( < i (gold), under a guarantee to pay the 

 invest irs 6 per cent, for five years. The interest prom- 

 ised would amount to only $112,500 (of the investors' 

 own money), and the promoters could enjoy the re- 

 mainder of the $37S,0C0 without putting out a single 

 rubber t -ec. 



"I do not think they [the public] really read rubber 

 prospectu es," -aid Mr. Horn. "They look at the cap- 

 ital and they lo ik at the area." And they fall over 

 themselves t 1 put their money on. A London dispatch 

 to the New York Tribune says: 



It is a maddening revel of speculation by the multitudes who are in- 

 vesting their small savings in rubber and oil shares. Rapid profits are 

 made when two shilling fhares rise to 50 or 70 shillings, and fresh invest- 

 ments are made in new issues. 



The London Bankers' Magazine calculates that as be- 

 tween February 19 and .March 20, the shares of ten 

 rubber plantation companies, capitalized at a total of 

 £1,313,000, rose in market value from £11,813,500 to 

 £16,239,750, or o7 l / 2 per cent. Meanwhile 387 repre- 

 sentative securities, other than rubber, actually declined 

 in market value. The rubber companies referred to are 

 earning large pn tits, or their shares would not be quoted 

 at such figures, and it is this fact that stimulates every- 

 body who can borrow 2 shillings to buy a share in one 

 of the new proposed companies. The London Financial 

 Nezvs, in commenting editorially upon a proposal that 

 the Stock Exchange close for a week or more to allow 

 the rubber craze to quiet down a bit, expressed the 

 opinion that the public would object. 



How sane ( ?) is much of the investment in rubber 

 is suggested by a correspondent of the New York Times, 

 who writes: 



The story is being told of an ol'd lady deep in rubber speculations whose 

 purchases were confined t" shares in the most extraordinarily named com- 

 panies, her . ing that these must be good because the promoters 

 could not afford to run the risk of putting bad properties on the market 

 without making the titles smooth to the tongue. 



And the character of many of the investments is illus- 

 trated by a recent prospectus of a company whose 

 plantation, in Central America, is slated to contain 

 33,000 Cast Ulna elastica trees, of which only 8,000 are 

 five years old or over. No trees have been tapped so 

 far. and the prospectus describes no general develop- 

 ment on the estate. And yet the promise is held out of a 

 substantial profit this year, and a steady rise in profits 

 until, five years hence, it is estimated that 218,000 rub- 

 ber trees (mostly not planted now), will he yielding 4 

 pounds of rubber each, salable at a profit of 3 shill- 

 ings a pound, or a total profit in l'»14 of £130,800 

 [=$636,538.20]. 



Of course no one with the slightest information in 

 regard to rubber would be tempted by these figures to 

 give up even a borrowed shilling, and the fact that such 



prospectuses do draw much cash from the public seems 

 to justify Sir Frank Swettenhanfs reference to lunatic 

 asylums. 



BENEFITS FROM HIGH-PRICED RUBBER. 



AX almost certain result from the present extreme 

 high prices of rubber is likely to prove of great 

 benefit to the world — the exploitation of new sources of 

 rubber. It is probable that no tree or plant now known 

 to yield rubber of any kind will be overlooked. Besides, 

 in the general search for this valuable material, new rub- 

 ber yielding species may be discovered. Such has been 

 the history of the trade from the beginning, when prac- 

 tically only "Para" rubber was used. Witness the ad- 

 vent, successively, of Assam rubber, the various African 

 sorts, and so on, down to the production of Mexican 

 guayule on a large commercial scale. 



With rubber at present prices, investors everywhere 

 listen with interest to proposals to use their capital, even 

 in remote districts, for the exploitation of trees and vines 

 known hitherto only to botanists or in commercial muse- 

 ums. What has been done with guayule alone lends en- 

 couragement to further investigation of new rubber spe- 

 cies. Mention may be made here of the comparatively 

 recent discovery of "caucho" trees throughout the Hevea 

 areas of the Amazon. Also of good rubber trees in the 

 Congo State and elsewhere in Africa where formerly only 

 rubber vines had been recognized. 



No less important than the discovery of new rubber 

 species is the better preparation of rubber in many coun- 

 tries. New methods of tapping and of coagulation are 

 being applied even to the rubber species longest known 

 in the trade, and others have been designed for the rub- 

 bers more recently discovered. The advantages of the 

 more scientific methods of rubber treatment include ( 1 ) 

 a larger yield per tree; (2) the arrival at the factory in 

 better condition; and (3) better profits of production. 



The desirable results here predicted from the existing 

 era of high prices for rubber need not cease with the 

 decline of prices which must come in time. The advan- 

 tages from the use of improved practices in rubber prep- 

 aration will lead to their being continued, and any new 

 grades of rubber now being introduced will still be 

 needed and will be seen in the markets. 



Thus high prices for rubber are not necessarily an un- 

 mixed evil for the trade. 



It is not fair to use the market quotations for crude rubber in 

 February, 1908, to illustrate the increasing value of the material. 

 The market in that month represented the combined influences of 

 the financial depression of the preceding autumn — when con- 

 sumption was temporarily checked — and the customary large 

 arrivals from the Amazon toward the end of winter. Rubber 

 has been very much higher for years than the low water mark 

 reached in February, 1908, and from that date the price has been 

 climbing steadily upward. At least let those who delight to com- 

 pare rubber prices, omit from their charts the quotations for a full 

 year from the date of the 1907 panic. 



