Money: Expensive Wallpaper


Although there is much to be said for hard work and perseverance, most of us would probably prefer to acquire our fortune by less strenuous means. The scenario of choice would be to invest a few dollars in a budding young company which hits it big in freeze-dried transistors, thus enabling us to grow rich on capital gains. Unfortunately, most budding young companies seem to encounter an early frost and you are left with nothing more than a handsome certificate to hang in the den.

Sometimes the company simply disappears, with not so much as bubbles or an oil slick to mark its fate. Such is life in the dog-eat-dog world of cutthroat capitalism where the bones of hapless investors bleach in the sun.

Your author himself has several of these priceless souvenirs tucked away. There is Emerald Isle Copper Company, a handsomely engraved certificate with a picture of a lady sitting on a rock surrounded by bear and cougar, while a hearty miner wields a pick in the background. And then there's Wyoming Oil Company (I have a weakness for the extractive industries) with its stately elk grazing amidst stately oil derricks.

On the other hand, you shouldn't dismiss these old dreams simply because you haven't heard anything from the company for years and you can't find any listing for the name. People move and records become confused. In addition, firms change their names or merge with others. There is an average of 6,000 company mergers in North America every year.

For example, a lady in Winnipeg found 400 shares of something called Sudbury Basin Mines Ltd., which her late husband had bought for $1,400 back in 1937. The company had stopped issuing reports 30 years ago and had seemingly dropped into that bottomless void which swallows up so many small mining ventures. But our lady persevered and eventually discovered that Sudbury Basin Mines had been acquired by another firm in a share trade and that she was entitled to 8 shares of Giant Yellowknife and 416 shares of Falconbridge Nickel. The widow's holdings turned out to be worth over $25,000!

While most old certificates may indeed be worthless, there is always a chance. A gentleman in the early 1950's bought 2,000 shares of Provo Gas for $3,000. Over the years he lost track of the company and assumed it had gone under. Then about 15 years later he had the company researched and discovered that Provo Gas had been taken over by Dome Petroleum and he now owned $20,000 worth of stock in Dome.

If you have old shares in a company which is no longer traded, you can try to get help from your stock broker. For Canadian mining companies, the Toronto Northern Miner, an industry-oriented newspaper, helps its readers locate obscure old companies. Another possibility is to try to locate the transfer agent listed on the certificate. Another method is to write to the commissioner of corporations or secretary of state who issued the corporate charter to see if they have any records of a merger or name change or some other clue to the firm's fate.

If these do-it-yourself investigations fail, there are firms which make a business of researching old companies. One such firm. Stock Market Information Service, is run by a French Canadian lady named Micheline Masse. Ms. Masse started by collecting old certificates to decorate her walls. When she discovered one that was worth $2,000, she began to take a more serious interest in the matter. Today her firm has two full-time and three part-time employees and has built up files on 25,000 companies around the globe that cannot be found in the published reference books.

SMIS requires a photocopy of the certificate and charges a flat $20 for a search. Ms. Masse estimates that 80 percent of the certificates turn out to be valueless, but 10 percent have turned out to have assets, and another 10 percent—such as shares in dormant mines—have potential. SMIS is located at 235 Dorchester Boulevard East, Suite 410, Montreal 129, Canada.

Another firm which has advertised to trace old companies is R.M. Smythe & Co., 170 Broadway, New York, NY 10038.


If you buy an old certificate from a second hand dealer, you should be aware that if the share is issued to a named person you probably won't be able to claim its value. You may be able to claim the value if the certificate is in bearer form. Bonds are more commonly in bearer form than are shares. If the certificate has been marked "cancelled," it is almost certainly of no value, even if the company is still alive.

In addition to old share certificates, there is a potential for hidden wealth in the old bonds of defunct governments. Although the Peoples' Revolutionary Council normally begins by denouncing the foreign debt of their bourgeois capitalist lackey predecessors, as they later become more established and start to think in terms of the business of running a country the notion of foreign borrowing becomes more appealing. At this point they encounter gentle reminders from the committees of foreign bond holders that it would be nice to do something about the old accounts. This results in a real pressure on the new governments to make some sort of settlement on the old bonds, if only a nominal one, just to tidy up the regime's credit image. As a consequence, pre-revolutionary czarist and Chinese bonds still trade from time to time in New York or London. If you watch the Foreign Bond column of the Wall Street Journal, you will see such rare birds fly by from time to time. This is particularly so when relations between the U.S. and some communist state are improving, as was the case a year or two ago with the bonds of the pre-communist Polish government.

Sometimes these foreign bonds are settled at full value. One lucky investor bought up Japanese government bonds in 1946—to paper his recreation room. Considering the condition of Japan in those days, the 1¢ on the dollar he paid was probably a high price. Ten years later the Japanese government decided to pay off its foreign debts and he found that his wallpaper had appreciated 10,000 percent!

As I said, while there is much to recommend hard work, there are other ways.

© 1975 Davis E. Keeler

Davis Keeler's Money column alternates monthly in REASON with John J. Pierce's Science Fiction column.