Investments

Of all the dimensions to the question of “What Happened?”, the financial one is most evocative.

The fascinating story continues through the financial lens. The most profitable businesses during this period were applying new science to the creation of remarkable substances. New science was costly but its rewards were consistent. Chemicals are not a volatile sector, it returns are small but constant, its products are domestic by nature, and its primary raw materials, water & electricity, are underwritten by the State’s utility licensees. Other sectors, like Food or Steel, do not share this profile. Only Utilities are more boring and more predictable.

Taking a look at 212 companies during this period, 38 have explicit significance to this analysis. Of those, 50 percent, had plants and headquarters in Niagara Falls. Given the remarkable convergence of technology, science, and capital in these 20 square miles, the return on equity ratios are telling. For tiny Pittsburgh Metallurgical, their return of 15.2% in 1962 was very attractive to investors and corporate suitors. In fact, it was the first company in this analysis to undergo a change in management and ownership. This was a subtle but significant sign of things to come.