A phenol-formaldehyde resole resin is prepared using a high level of catalyst at a polymerization temperature of about 63.degree. C. The endpoint, measured by salt water tolerance, is selected so that the resulting resin has a water dilutability of 20:1 at neutral pH after storage for three weeks at a temperature of about 13.degree. C., with a free phenol level of no more than 0.50 percent.

 
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