**A. B. & Co.** **Investment Bankers** **We have today secured substantial control of the successful machinery business heretofore conducted by —— at ——, Illinois, which has been incorporated under the name of the Excelsior Manufacturing Company with a capital of $10,000,000, of which $5,000,000 is Preferred and $5,000,000 Common.** **As we have a large clientele of confiding customers, we were able to secure from the owners an agreement for marketing the Preferred stock—we to fix a price which shall net the owners in cash $95 a share.** **We offer this excellent stock to you at $100.75 per share. Our own commission or profit will be only a little over $5.00 per share, or say, $250,000 cash, besides $1,500,000 of the Common stock, which we received as a bonus. This cash and stock commission we are to divide in various proportions with the following participants in the underwriting syndicate:** **C. D. & Co., New York** **E. F. & Co., Boston** **L. M. & Co., Philadelphia** **I. K. & Co., New York** **O. P. & Co., Chicago**
Were such notices common, the investment bankers would “be worthy of their hire,” for only reasonable compensation would ordinarily be taken.
For marketing the preferred stock, as in the case of Excelsior Manufacturing Co. referred to above, investment bankers were doubtless essential, and as middlemen they performed a useful service. But they used their strong position to make an excessive charge. There are, however, many cases where the banker’s services can be altogether dispensed with; and where that is possible he should be eliminated, not only for economy’s sake, but to break up financial concentration.