by Bartley's avarice. Bartley's legitimate business at home and abroad
could now run alone. So he invited Hope to England to guide him in what
he loved better than steady business, viz., speculation. The truth is,
Bartley could execute, but had few original ideas. Hope had plenty, and
sound ones, though not common ones. Hope directed the purchase of
convertible securities on this principle: Select good ones; avoid time
bargains, which introduce a distinct element of risk; and buy largely at
every panic not founded on a permanent reason or out of proportion.
Example: A great district bank broke. The shares of a great district
railway went down thirty per cent. Hope bade his employer and pupil
observe that this was rank delusion, the dividends of the railway were
not lowered one per cent. by the failure of that bank, nor could they be:
the shareholders of the bank had shares in the railway, and were
compelled to force them on the market; hence the fall in the shares.
"But," said Hope, "those depreciated shares are now in the hands of men
who can hold them, and will, too, until they return from this ridiculous
85 to their normal value, which is from 105 to 115. Invest every shilling
you have got; I shall." Bartley invested £30,000, and cleared twenty per
cent. in three months.

Example 2: There was a terrible accident on another railway, and part of
the line broken up. Vast repairs needed. Shares fell twenty per cent.

"Out of proportion," said Hope. "The sum for repairs will not deduct
from the dividends one-tenth of the annual sum represented by the fall,
and, in three months, fear of another such disaster will not keep a
single man, woman, child, bullock, pig, or coal truck off that line. Put
the pot on."

Bartley put the pot on, and made fifteen per cent.