The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1907-02-17

that the reason railways cannot sell
bonds Is because they are In too big
chunks to appeal to ordinary investors.
He suggests that the way to make
market for railway bonds Is to cut them
all into smaller pieces after the French
fashion Many people would be glad to
put their money into railway bonds, but
they cannot afford to pay $1,000 apiece for
them. If they could buy them for 500
apiece or $50 apiece they would put their
money into them.
These clever fellows who come to New
York and sell mining stocks know the
public taste. They do not try to sell the
public any 800 shares The standard price
for mining shares is $40 in the east; in the
west the standard price Is 81. The mid
way price, S. is very popular And then
there are hundreds and hundreds of com
panies that sell their shares for so cents,
% cents and 10 cents, and even 1 cent a
share. Even the big millionaire pro-
motess stick to the low-prlced shares.
Occasionally these mining companies,
when they become we'll seasoned in order
j to get on the New York Stock exchange.
rearrange their capitalization to the 500
basis, but they get the publics money
on the lowpriced basis.
The public apparently takes a childish
delight In buying as many shares of
mining stock as possible for minimum
amount of money. If a mine is capital
tied at $40 900 600 with 100000 shares of 800
par value it appeals only to a limited
circle of investors. But If the price of
the shares is divided by ten, and the
number of shares multiplied by ten 1t i'm
mediately appeals to a big circle of
investors man who will not buy one
/ share OF mining stock at 800 readily buys
! ten shares at $40. The ease with which
! the investor may acquire a large num-
Der of shares of mining stock at small
price also appeals to his vanity. A man
at the Waldorf the other night carelessly
remarked to a group about table In the
! cafe. when the name of Colorado mine
| was mentioned. why | have $4,000 shares
! of that. The westerner's $4,000 shares
| represented a total outlay of $500.
The railways have difficulty in raising
| money to meet their necessary needs. But
! millions upon millions of dollars are being
invested by the public month after month
| in mining ventures. No doubt the man
| In the street who puts his money into
mining stock does so because some day
/ he thinks that one of his 100 to l shots
will win out The buyer of new min
| ing stock-a prospect-goes through about
! the same mental process as the man at
the race course who takes a hyer on
long shot
If he loses his money he does not
er1lmble OF course, the man who buys
a railway bond or a short term note
| knows that his dividend is never going TO
be raised and his only hope of making
profit in excess of the interest Is tnat
the security may have some apprecla-
tion In price during it's life. But millions
| of dollars of investment money might
be had by the railways If they went after
| IT In the right way. fhe mining pro-
moter gets the public's money by using
modern advertising methods.
He keeps everlastingly at it until he
| gets the money But the railways and
| bankers who act as agents for the rail-
| WAYS in raising money Will not resort
| to any cheap methods of interesting in
| vestors If the railways would educate
, the public to the merit of investment In
| railway bonds and stocks, and would
! then give small investors the opportunity
| to buy railway securities, they would
reach a public that now is putting its
| money into mining ventures.
| James j. Hnl's friends are picking up
| the Great Northern ore certificates stead
| ily The Hill iron ore lands would not be
| worth hundredth part of their present
value but for the great cheapening OF the
| cost of transporting ore from the mines
| at the head of the lakes to the blast
| furnaces, a thousand miles away IN flt's-
| hure When we began rolling Bessemer
| rails in the late COS it cost more to carry
ore from Marquette to Ohio than the ore
| is now sold for.
Tn the old days the ore was mined and
loaded on cars by human labor, hauled
| - tba docks in small trainloads. put
aboard 1O0O-ton sailing vessels by means
of wheelbarrows. and unloaded again by
h,p,an labor at Ohio ports. Before the
srst 500 canal was dug. the ore had to
be rehandled at the portage. between