have a double meaning for the banks: first, as profitable transactions; and secondly as splendid opportunities for getting control of the companies in difficulties.53
Here is an instance. The Union Mining Company of Dortmund, founded in 1872, with a capital of about 40,000,000 marks, saw the market price of its shares rise to 170 after it paid in its first year a 12 per cent. dividend. Finance-capital received a "trifle" of something like 28,000,000 marks. At the foundation of this bank the chief part was played by that same Disconto Bank which attained a capital of 300 million marks. But the dividends of the Union fell to nothing: the shareholders had to consent to a reduction of capital, that is, to losing some of it in order not to lose it all. By a series of reconstructions, more than 73,000,000 marks disappeared in thirty years from the funds of the Union. "At present, the original shareholders of this company have only got 5 per cent. of the nominal value of their shares. But the bank kept on doing well from each reconstruction."54
Speculation in land situated in the suburbs of towns making rapid progress is also a very profitable operation for finance capital. The monopoly of the banks here coincides with that of the means of communication, since the increase in value of the land and the possibility of selling it profitably in allotments is mostly dependent on good means of communication with the centre of the town; and these means of communication are in the hands of large companies connected, by the participation system and by the distribution of positions on the directorate, with the interested banks.
