Thestockmarketinterestofthosemenwhohavethemanagementofindustrialcorporationsisawideandmultifariousone。Itisnotconfinedtotheprofitablepurchaseandsaleofpropertieswhosemanagementtheymayhaveinhand。Theyarealsointerestedinmakingormarringvariousmovementsofcoalitionorreorganization，andtothisulteriorenditisincumbentonthemto“manipulate“securitieswithaviewtobuyingandsellinginsuchamannerastogaincontrolofcertainlinesofsecurities。24*Henceitisaruleofthisclassofbusinesstraffictocultivateappearance，-toavoid，orsometimestocourt，theappearanceofsin。Sothatunderthisleadershipthecourseofindustrialaffairsis，ingreatmeasure，ifnotaltogether，guidedwithaviewtoaplausibleappearanceofprosperityorofadversity，asthecasemaybe。Undergivencircumstancesitmayaswellbecometheaimofmenincontroltomakeanadverseshowingasafavorableone。Thehigherexigenciesofthecaptainofindustry’spersonalfortunes，asdistinctfromthoseofthecorporationcontrolledbyhim，mayfromtimetotimebebestsewedbyanapparent，ifnotanactual，mismanagementofindustrialaffairs。Aconvincingappearanceofdeclineordisasterwilllowertheputativeearning-capacityoftheconcernbelowitsrealearning-capacityandsowillaffordanadvantageousopportunityforbuyingwithaviewtofutureadvanceorwithaviewtostrategiccontrol。Variousotherexpedientslookingtothelikeoutcomearewellknowntothecraft，besidesbonafidemismanagement。Agivenlineofsecuritiesmaybetemporarilydepressedbylessheroictactics；butthepointinquestionhereisthefactthatunderthissystemofcorporationfinancetheaffairsofthecorporationareingoodpartmanagedfortacticalendswhichareofinteresttothemanagerratherthantothecorporationasagoingconcern。
Whatwassaidinspeakingofcreditextensionwithoutadeterminatetimeinterval25*appliestothisclassofbusiness，withaslightchangeofphrase。Inthishigherdevelopmentofcorporationfinance，inthemanipulationsofvendiblecapital，theintervaloftheturnoverspokenofabovebecomesanindeterminatefactor。Thegainsofthebusinesscometohavebutanuncertainandshiftyrelationtothelapseoftimeandcannotwellbecalculatedpercent。pertime-unit。Thereis，therefore，onthesehigherlevelsofbusinessmanagement，properlyspeakingnoascertainableordinaryrateofearnings。Thecapitalwhichmaybedistinctivelyregardedasoperativeinthebusinessofmanipulation，thevaluableitemsspecificallyemployedinthetrafficinvendiblecorporatecapital，ismadeupoftheoperator’sgood-willandhisfinancialsolvency。Solvencyonalargescaleisrequisitetocarryingontrafficofthisclass，butthecollateralonwhichthisextensivesolvencyconstructivelyrestsistobutapartialextentdrawnintothebusinessasabasisforanactualcreditextension。Whatcountsinthecaseisthesolvencyoftheoperatorratherthananoutrightresorttothecreditextensionwhichthissolvencymightafford。Theworkingcapitalinvolvedinthesetransactionsisaccordinglyofapeculiarlyelusivecharacter，andthetimeelementintheuseofthiscapitalishardtodetermine，ifsuchatimeelementcanproperlybesaidtoenterintothecaseatall。
Moreindetail，thebusinessmaninpursuitofgainalongthislinemust，intheordinarycase，bepossessedoflargeholdingsofproperty，thisbeingthebasisofthesolvencynecessarytothebusiness。Theseholdingsarecommonlyintheformofsecuritiesintheconcernwhosevendiblecapitalisthesubjectofhistraffic，aswellasinothercorporations。Thesesecuritiesrepresentcapital，tangibleandintangible，whichisalreadyemployedintheordinarybusinessoftheconcernbywhichtheyhavebeenissued；thecapital，therefore，isalreadyinusetothefullextentandispresumablyyieldingtheordinaryrateofearnings。Butthesolvencyforwhichtheownershipofthiscapitalaffordsabasismayfurtherbeusefulinenablingtheownertocarryonatrafficinvendiblecorporatecapitalwithoutwithdrawinganyappreciableportionofhisholdingsfromthelucrativeinvestmentsinwhichtheyhavebeenplaced。Inotherwords，heisable，undermoderncircumstances，tomakeasecondaryuseofhisinvestmentsforthepurposeoftradinginvendiblecorporatecapital；butthissecondaryuseofinvestmentsbearsnohardandfastquantitativerelationtotheinvestmentsinquestion，nordoesitinanydeterminatewayinterferewiththeordinaryemploymentofthisinvestedcapitalinthecommonplaceconductofthecorporations’businesstraffic。Thecapitalemployed，aswellasthepotentialcreditextensionwhichitaffordsforthepurposesofthishigherbusinesstraffic，isthereforeinapeculiardegreeintangible，and，inrespectofitsamount，highlyelusive。
Muchthesameistrueofthegood-willemployedinthistraffic。Itisalsoingoodpartgood-willwhichalreadyservesthepurposesofthecommonplacebusinesstrafficofthecorporationsonwhosesecuritiesthebusinessmaninquestionrestshissolvency。Sothatinthishigherbusinesstrafficthegood-willengagedisalsohereturnedtoasecondaryuse。Thebusinesseconomieswhichareinthiswaymadepracticablebyareduplicationofusesandmadetoinuretothegreaterbusinessmen’sprofitareofgreatmagnitude；butthemagnificentadditionswhichareinthiswaymadetothebusinesscommunity’scapitalizableforcesneedscarcelybedweltonhere。
Theelusiveandflexuouscharacteroftheelementsofwealthengaged，aswellastheabsenceofanascertainableordinaryrateofearningsinthislineofbusiness，hasledeconomiststospeakofthistrafficinvendiblecapitalasa“speculative“
business。Themerebuyingandsellingofstocksbyoutsidersforariseoradeclineisofcourseaspeculativebusiness；itisatypicalformofspeculativebusiness。Butinsofarassuchbuyingandsellingiscarriedonbythemanagersofthecorporationswhosesecuritiesarethesubjectofthetraffic，andespeciallywherethesecuritiesareboughtandsoldwithaviewtothecontrolofthecorporationsinquestionandtheirmanagementforprivate，tacticalends，acharacterizationofthebusinessas“speculative“isinadequateandbesidethepoint。
Thishigherreachofcorporationfinancieringhaslittleifanymoreofaspeculativecharacterthanwhatbelongstothecommonplacebusinessmanagementofanyindustrialenterprise。Inallbusinessenterprisethatstandsinrelationswiththemarketanddependsonvendibilityofitsoutputthereismoreorlessuncertaintyastotheoutcome。27*Inthissenseallindustrialbusiness，aswellascommercialbusiness，hassomethingofaspeculativecharacter。Butitislittletothepurposeonthataccounttolumpindustrialenterprisesandcorporationfinancieringtogetheras“speculativebusiness“anddealwiththemasifthisweretheirmostsalientandconsequentialbearing。Whatspeculativeriskthereisintheselinesofbusinessisincidental，anditneitheraffordstheincentivetoengaginginthesepursuitsnordoesitboundthescopeoftheirbearinguponeconomicaffairs。Thespeculativeriskinvolvedisnogreater，relativelytothemagnitudeoftheinterestsinvolved，inthislargertrafficthatdealsinvendiblecapitalthanitisintheordinarylinesofbusinesstrafficthatdealinvendibleproducts。Inbothcasestheremaybespeculation，butinbothcasesitisasideissue。Indeed，asnearasonemayconfidentlyholdanopiniononsodarkaquestion，thecertaintyofgain，thoughperhapsnottherelativeamountofit，seemsrathermoreassuredinthelarge-scalemanipulationofvendiblecapitalthaninbusinessmanagementwithaviewtoavendibleproduct。
Whatmayobscurethequestionisthefactthatthemanipulationsinvolvedinthistrafficinvendiblecapitalcommonlyimposeincreasedrisksuponthebusinessconcernsengagedinindustry-thecorporationswhosecapitalisinvolved，aswellasotherfirms。Theeverydaybusinessofthecorporationswhosesecuritiesareinvolved，aswellasofotherbusinessconcernsengagedinrivalorrelatedlinesofindustry，isrenderedmorehazardousthanitmightbeintheabsenceofthisfinancieringtrafficinvendiblecapital。Themanipulationscarryrisk，notsomuchtothemanipulatorsassuch，astothecorporationswhosepropertiesarethesubjectofmanipulation；
butsincethemanipulatorscommonlyownbutarelativelysmallproportionofthepropertiesinvolvedortouchedbytheirmanipulations，theriskswhicharisedonotfallchieflyonthem。
Tothisistobeadded，asofprimeimportanceforthewholequestion，thatthemanipulatorshavetheadvantageofbeingable，ingreatpart，toforeseethenature，magnitude，andincidenceoftheriskswhichtheycreate。Rightlyseen，this，ofcourse，goestosaythattheincreasedspeculativeriskduetothetrafficinvendiblecapitaldoesnotfallonthattraffic，butonthebusinessenterpriseengagedabouttheoutputofvendiblegoods。
Thetrafficinvendiblecapitalisnotwithoutitsspeculativerisks，buttheriskswhichitcreatesfallwithrelativelygreaterweightuponthebusinessmenwhoarenotimmediatelyconcernedinthistraffic。Indeed，sosecureandlucrativeisthisclassofbusiness，thatitischieflyoutofgainsaccruing，directlyandindirectly，fromsuchtrafficinvendiblecapitalthatthegreatmodernfortunesarebeingaccumulated；andboththerateandthemagnitudeoftheseaccumulations，whethertakenabsolutelyorrelativelytothetotalincreaseofwealth，surpassallrecordedphenomenaoftheirkind。Nothingsoeffectivefortheaccumulationofprivatewealthisknowntothehistoryofhumanculture。
Theaimandsubstantialsignificanceofthe“manipulations“
ofvendiblecapitalherespokenofisaneverrecurringrecapitalizationofthepropertiesinvolved，wherebytheeffectivecapitalizationofthecorporationswhosesecuritiesarethesubjectofthetrafficisincreasedanddecreasedfromtimetotime。Thefluctuations，orpulsations，ofthiseffectivecapitalizationareshownbythemarketquotationsofthesecurities，asnotedabove。28*Itisoutofthesevariationsincapitalizationthatthegainsofthetrafficarise，anditisalsothroughthemeansofthesevariationsofcapitalizationthatthebusinessmenengagedinthishigherfinanceareenabledtocontrolthefortunesofthecorporationsandtoeffecttheirstrategicworkofcoalitionandreorganizationofbusinessenterprises。Hencethistrafficinvendiblecapitalisthepivotalanddominantfactorinthemodernsituationofbusinessandindustry。29*Ithasbeennotedabovethatwhatmaybecalledtheworkingcapitalonwhichthishighercorporationfinanceproceedsismadeup，chiefly，oftwoelements:thesolvencyandconsequentpotentialcreditofthemenengaged，andthe“good-will“ofthesemen。Bothoftheseelementsareofasomewhatintangibleandelusivecharacter，resting，astheydo，somewhatindirectlyandshiftilyonelementsalreadyelsewhereengagedinbusinessenterprise。Thesolvencyinquestionrestsinlargepartonthecapitalofthecorporationswhosecapitalizationissubjecttothefluctuationsinducedbythetrafficinvendiblecapital。Itisthereforenecessarilyasomewhatindeterminateandunstablemagnitude。Tothisistobeaddedthe“floatingcapital“andbankingcapitalatthedisposalofthesemen。Ifacommon-senseviewbetakenofthebusiness，thegood-willengagedmustalsobeaddedtotheassets。Thereisinvolvedaveryconsiderableandveryvaluablebodyofgood-will，appertainingtothefinanciersengagedandtothefinancingfirmsassociatedwiththem。30*Thisgoodwillandthissolvencyiscapital，forthepurposeinhand，aseffectuallyasthegood-willandsecuritiesincorporatedinthecapitalizationofanycorporationengagedinindustrialbusiness。
Buthithertothisparticularcategoryofgoodwillhasnotbeenformallycapitalized。Theremaybepeculiardifficultiesinthewayofreducingthisgood-willtotheformofafund，expressingitintermsofastandardunit，andsoconvertingitintoquotablecommonstock，ashasbeendonewiththecorrespondinggood-willofincorporatedindustrialenterprises。
Soalsoasregardsthebodyofsolvencyengaged，-thepotentialcredit，orcreditcapacity，ofthepromotersandfinanciers。
Perhapsthislatterhadbestalsobetreatedasanelementofgood-will；itisdifficulttohandleunderanyother，moretangible，conception。Itmaybedifficulttostandardize，fund，andcapitalizetheseunstablebuthighlyefficientfactorsofbusinessenterprise；butthesuccessfulcapitalizationofgood-willandcreditextensionsinthecaseofthemodernindustrialcorporationsarguesthatthisdifficultyshouldnotbeinsurmountableincaseanurgentneed，-thatistosay，theprospectofaprofitablyvendibleresult，-shouldpressforaformalcapitalizationofthesepeculiarelementsofbusinesswealth。Therecanbenoquestion，e。g。，butthatthegood-willandlargesolvencybelongingtosuchafirmasJ。P。MorganandCompanyforthepurposesofthisclassofbusinessenterpriseareanextremelyvaluableandsubstantialasset，asisalso，andmoreunequivocally，thegood-willoftheheadofthatfirm。Theseintangibleassets，immaterialgoods，should，inallconsistency，bereducedtostandardunits，funded，issuedascommonstock，andsoaddedtothestatisticalaggregateofthecountry’scapitalizedwealth。