Word: raskob
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...fact that very soundest stocks were selling at ten times current earnings and many a stock such as that of the General Motors Corp. reached a point where it was only five or six times current earnings. And General Motors, according to the once unchallenged statement of John J. Raskob, should sell at 15 times earnings. Quite aside from their relation to earnings many stocks sold at a point where their actual yield in dividends was higher than the yield of bonds. The following were typical of stocks which were purchased at a price to yield in dividends between...
...maxim used to be that a stock should sell, other things being equal, for about ten times earnings. The maxim now says "15 times earnings." This is known as Raskob's Rule, because one day in March 1928, John Jacob Raskob, then finance director of General Motors, walked up a gangplank on his way to Europe and remarked that 15-times was a proper modern ratio-that General Motors ought to have been selling at that time...
...Since Raskob's Rule came from a motor-maker, quidnuncs laughingly pointed to automobile stocks as they studied belated earnings reports for the first six months of 1929. Though many another stock was up to 20, 25 and even 30 times earnings, only three prominent motor stocks were selling at "15 times" or more. Many were below the ten times ratio even in the bull market of 1929. The following table shows recent prices of a number of representative automobile stocks and the price they would command at "15 times" according to first-six-months reports...
...Enter Raskob. John Jacob Raskob, quiescent financially since he left General Motors to manage the Smith campaign for President, has bought a large stock interest in Aero Supply Manufacturing Co., Inc., called the "oldest aviation accessory enterprise in the country." Aero Supply owns Standard Automatic Products Co. of Corry, Pa., and National Steel Products Co. of Ohio. Rumored: a big Raskob-headed air corporation...
...delegates crowded into Richmond's Shrine temple for a state convention. Mr. Slemp was still smiling wisely when he arose, proposed and had his fellow Republicans nominate a Democrat for Governor. The Democrat was Prof. William Moseley Brown of Washington and Lee University, already nominated by the anti-Smith-Raskob wing of his own party (TIME, July, 1). Regular Republicans and the Democrats who had followed Bishop James Cannon Jr. out of their party at Roanoke last fortnight thus coalesced against the regular Democratic state organization. The band played "Dixie." A platform was adopted without the bother of reading...