Carl Ramström

"Ruben’s great effort during the deflation that followed the depression was that, with Carl Ramström’s good memory, he insisted that none of SLT’s companies were allowed to buy more paper and cardboard. Instead, they should report to him what they had in stock. When a company then needed more paper or cardboard, they had to turn to Ruben who could then inform them about where in the conglomerate the material was available. In this way, Ruben essentially emptied SLT’s various stocks without anyone being allowed to replenish as long as the deflation curve did not flatten out. This action saved the conglomerate a lot of money: when the crisis was over, paper prices had dropped by half. Through the successful procurement policy, Ruben began to gradually strengthen his influence within the conglomerate. But not only that; he was also about to marry his fiancée of several years."

"At the beginning of 1923, the small family moved to Gothenburg, where Ruben immediately immersed himself in his new work tasks. The managers of SLT’s Gothenburg company, Melin, Gothenburg Lithographic and Hugo Brusewitz AB, felt threatened and did what they could to oppose and ostracize the energetic young manager from Stockholm. Moreover, they found it quite humiliating to take orders from someone who was a couple of decades younger than themselves. But Ruben took their resistance calmly. He knew that he had Carl Ramström’s support, and he was aware that his ideas about Scientific Management were something for the future. He had decided to implement the necessary measures to bring order to the business at any cost."

"Strengthened by successive salary increases and increasingly interesting tasks, Ruben remained in SLT. During the depression of 1920–1921, Ruben understood that in Carl Ramström he had a kin in terms of the effects of inflation on businesses. When inflation was at its worst during World War I - at times the inflation rate was up to 40 percent - Ramström decided that no goods in stock should be accounted for at higher values than they had when the war broke out. In this way, he had built up a fund “behind the inventory” that was not visible in the accounting. Carl Ramström made sure that the board never found out how the inventory values were reported. If the partners found out that there were assets that were not visible, they would demand the corresponding amount in dividends, he feared. Instead, he dampened the board’s dividend appetite by giving each member a brand new Cadillac as soon as the economic situation had stabilized. If Ramström’s measures had not succeeded, there would not have been any buffer when the depression struck in 1920. Ramström’s action probably saved SLT. When demand fell during the depression, the group could ride out the crisis thanks to the fund."

"Carl Ramström’s insight into the danger of relying too much on the “good” results shown during high inflation rates was quite unique in the business world. It can be mentioned that not even the Wallenberg family had fully understood the connections. The district court judge himself, Marcus Wallenberg Senior, had understood it, but couldn’t withstand the rest of the family who insisted on higher dividends when the figures had been driven up by inflation. They had not understood that the “fine” figures really just constituted a big house of cards. The high dividends within the companies of Enskilda Bank were close to leading to the companies going under and the Wallenbergs nearly lost their role as Sweden’s leading financial family."