hy should it not be capitalized for four millions?"

"Because that is not business--safe, conservative business. Because that
would make it impossible to raise the money needed without ourselves
taking chances of great loss. Let me proceed. Having organized in a
legal manner, and having issued certificates of stock to the extent of
ten millions of dollars, we can next proceed to raise the money required
to begin active building operations."

"By placing the stock on the market?"

"Not yet. Every man here, with the possible exception of yourself, Mr.
Merriwell, is known to every great banking institution in the country,
and his credit is unlimited. At the outset we will take four million
dollars' worth of our stock to some institution and secure from it on
that stock the full sum required to build the railroad. Thus, you can
see, we will not have to put up a dollar of our own money; but we will
build the railroad with the money of the general public, which has been
deposited at the bank from which we secure it."

"I see," nodded Frank, his eyes shining queerly. "It's a fine little
scheme you have, Mr. Jerome!"

"I am letting you into the secret methods of capitalists who build
railroads and organize great business projects without using a dollar of
their own money," said Jerome. "Having secured our money, we will
proceed to put our railroad through."

"We'll build it, and the general public will pay the bills?"

"Exactly. Having it constructed, by successful manipulation--the easiest
thing in the world for those who know the trick--we'll unload four
million dollars' worth of stock on the public and square ourselves with
the bank. At this stage of the game the public will have paid for the
railroad, which was built with the public's own money; but we shall
still hold six million dollars' worth of stock in that road, or the
controlling interest."

Frank felt his blood growing hot within his veins.

"In short," added Jerome, "we take no chances whatever, for at the start
we know the road will cost a million less than half the amount for which
it is capitalized, we have borrowed the public's money to build it, we
are certain we can sell stock enough to pay back every dollar, and still
hold control of the railroad, and we are in a position to come out ahead
whether the railroad proves to be a paying piece of property or not."

"And this is the way railroads are built?" muttered Merriwell. "But what
if we find, afte