What would be the fix for this?
 

I have no idea how this damage occurred, but things happen over 70yrs to bikes. The damage is to the NDS, so as a wall hanger, it still presents nicely.

https://cimg3.ibsrv.net/gimg/bikefor...b85bb4329.jpeg
seatstay hole

If it wasn't chromed, I would say replace the stay is the fix. The chrome makes it problematic and uneconomic.

Stuff some epoxy putty in there and smooth it and then shoot a bit of phony chrome paint on the area

Water probably entered through a vent hole in the SS, then bike was hung upside down for extended amount of time and rusted internally. The original chrome plating acids might have also started the internal corrosion if it was not all washed out after chroming. There might be similar damage in the other SS that is not through the tube. You could have the SS replaced, would just need to grind all the chrome away from the cluster where the SS joins so that the braze can adhere to the underlying steel.

Ahh, thank you. I knew it looked like frozen water damage, but I was confused at that area. Hadn't even thought of hanging upside down.

It's an early '50s Paramount track frame, so it is probably *worth* being repaired. Although it's also probably *worth* getting a full Waterford restoration.

It's only worth what someone is willing to spend the $ for. Whether that person is the OP or some other one is not the issue. Who is spending the $ is the only judge that counts. Some people look at their bikes with only their use/ownership in mind (this is likely most people). Some view themselves as a collector or a restorer of history and thus their $ has a different value equation to be run through. A fully chromed bike is not the quick and easy finish to work on. Expect the stay replacement, and after repair refinishing, to be well more then would initially be thought of. Andy

Clean up and keep as wall art?

Yes.