Gibson's Surprise

A popular and publicity success, the New York World's Fair of 1939 was a financial flop. By midseason, exhibitors and merchants holding $28,000,000 of its 4% debentures had forced out overconfident Grover Whalen, put Banker Harvey Dow Gibson (Manufacturers Trust Co.) in charge of the books. In September, to help the Fair pay its bills, bondholders had to sacrifice their 40% lien on the gate receipts. During 1939, the bonds dropped from 80 to 17.

When he opened the 1940 Fair this spring, Banker Gibson was not overconfident. Said he, "If everybody who comes to the Fair has a good time, we will be satisfied." No showman, he gave the Fair a banker-like administration. Though the cost of the Fair's service contracts increased, total operating costs were cut 31% under last year.

Last week Banker Gibson cast up his accounts. Despite a 21% drop in attendance under 1939, the Fair had $651,184 in cash, no current overdue debts. Debenture holders, their $28,000,000 already reduced to $24,000,000, were promised another $1,200,000 next month. And their guarantee of 40% of the gate was restored.

To bondholders who had long ago chalked off their investment to experience and good will, this announcement was a mild but pleasant surprise. The debenture market bounced from 15 to 17. With 5,877,481 in total paid attendance at the end of the 62nd day, it would take an improbable 34,122,519 in the 93 days left to justify (by Gibson estimate) full payment on the bonds. But, based on present attendance, holders could reasonably think in terms of about 30-c- on the dollar when the Fair closes Oct. 30.

This file is automatically generated by a robot program, so reader's discretion is required.