In calculating this setup, I had help from the head office in New York and in the person of Joseph F. McCarthy, controller of United Aircraft. Mac, I found, was the sort of wizard who could glance at columns of figures and read in them signs and portents such as could be made clear to me only after I had reduced them to engineer’s language of graphs and charts. From him I discovered that a financial statement is not just the cold record of past mistakes or triumphs, but also a weather map from which to forecast future trends and to take decisions calculated to reap the abundant harvest. Using the figures available, we calculated the size of the facility with which we might expect to continue to break even during a period of slow demand but still retain the flexibility essential to reaping a profit when the tide turned. United Aircraft was frankly not in business for its health; it was in business for a fair profit and each of the subsidiaries was expected to stand on its own two feet. By consolidating the financial resources of all its subsidiaries in the parent company, it had in effect broadened the resources of each. Any company in temporary need of funds might look to the parent company without going outside to borrow, but over the long pull it must contribute its share to the over-all income. Having had no training whatever in accounting or finance, but having been schooled by Dr. Lucke to search for fundamental principles, I now began digging down to bedrock and in J. F. McCarthy, himself, discovered a rich nugget. Profit, it seemed, was not just the excess of receipts over expenditures, a sum to be divided among a few insiders and squandered in riotous living. Profit was, among other things, the great regulator and controller of trade, and trade was the foundation of human existence. Under the free play of natural competitive forces, the compelling need to make a profit or go out of business and starve was what drove men to cut costs of production. If they could reduce costs enough to make the product available to more people they could increase the demand and expand the volume of production. Out of their profits, or the anticipation of profits, they could attract new money with which to buy new machinery designed to cut costs further and expand volume further. All this was a delicate, living process that required good judgment and great skill to nurture. Profit, it appeared, was like the governor on a steam generator. Increased demand for power would slow down the engine and reduce the voltage were it not for the fact that the governor, sensitive to small changes in speed, now opened the throttle wider to admit the extra steam required to meet the new demand. Contrariwise, when the demand fell off the engine might overspeed and destroy itself, save that the eversensitive governor now reacted quickly to close the throttle, and save the machine.