"But it's your help, your faith and backing, which made such big things possible for him. To think that he's been in New York only a year or two! To think where he will be after ten years—" Dorothy broke off, caught her breath sharply, and laughed at her own enthusiasm. "Oh, I'm intoxicated with the very thought of what he's accomplished and what he will accomplish! Now tell me about the companies you-all handle. Do you buy them and then sell them later for more money?"
Macgowan shook his head. "No. A manufacturing concern, let us say, is poorly managed yet essentially sound. We buy it. We reorganize it. Consolidated Securities owns it and continues to own it. A minority of the stock is sold to our investors, to the people who own Consolidated stock. It is their privilege to buy stock in this subsidiary company—"
"The preferred stock?" cut in Dorothy. Macgowan chuckled at her sapient air.
"Yes. Two shares and no more to each investor, but with these two shares goes one share of common at a nominal valuation. Suppose we start or reorganize two or three such companies in the course of a year—and we hope to do better than that—the chances are very good for our investors. Consolidated sells the stock, owns the subsidiary company, runs it! Thus, Consolidated must make sure that the company will not fail but succeed. The investor shares the profit with Consolidated; also, he shares Consolidated's profit from the whole group of companies. You see the idea?"
Dorothy nodded quickly, then was checked by Macgowan's air.
"There's just one thing." His tone was hesitant, embarrassed. Her eyes leaped to his face; his voice seemed to bring a swift apprehension into her mind.
"Yes?" she urged him with an eager word.
"There is one thing—" Macgowan was unaccountably at a loss for speech; to any who knew him well, an astounding thing. "You understand, the success of Reese Armstrong means everything to me; I may call myself his closest friend, at least in New York. And I know, my dear, that with you at his elbow, with your faith and help behind him, he is invincible."
Suspense flashed into the girl's eyes. This prelude, this slightly frowning air of embarrassment, hinted at some portentous secret.
"Yes?" she prompted again.