Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1907-05-17
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the man who works hard for his
money and then expects his money to
work for him, safety in his invest
ments is his first consideration.
While the rate of interest is also a
consideration, nevertheless secon-
Diary to the safety and permanence Of
the security he buys. In the purchase
of first mortgages the security behind
the loan is generally two for one,
or better; but on the other hand, the :
rate of interest is low. .. y.
It is an established fact that the
higher grade the security, the lower
the rate Of interest, and no better IL
lustration is needed than government
bonds. Uncle Sam can borrow all the
money he wants at two per cent per
annum, simply because he gives the
entire country as security, with each
.indiyid dar therein pledging his life 7
and property to the payment sof the
debt at maturity -. ss:s. ss sf - 7@ d {
But good and strong as Uncle Sam
u.s. and regardless Of the fact that he !
can borrow to the limit at low rates,
there are thousands of securities that
are regarded with more. favor than
his, not only from the standpoint of
safety. and permanency, but because
the semi-annual dividends are sew.
eral times greater than your uncle
pays only oncea year. st
We have an investment that We
know to be just as safe and perma-
nent as a government bond, but with
this difference: A government bond
at q per cent. pays back the original
investment in fifty years, while ours
is more than likely to pay it back in
side of twelve months
Now, let us see what there is to sup
port this statement: In the first
place, we have over $6,000,000 in re-
coverable values right in sight, and
with 100000 worth Of mills, machin-
cry, tools and equipment already on
hand, our property as it stands today
is worth $6,5O0,OO0. Our capital stock
is $2,500,0O0, and if we were capital
lied on basis of value, 81, 100000 of
4 additional, stock would be needed to
equa1ize the surplus. II we were cap
italized on basis of what we will be
able to earn, our capitalization would
be as large as some of the best known
corporations in the country.
But to get back to the proposition
that we are likely to repay our in
\ vestment inside of twelve months:
With a minimum mill capacity of 500
tons of material per day, with an av-
erage valuation Of $40 per ton, and
only working 800 days per year, the
returns will foot up 60 per cent of the
total capitalization. If we sell small
allotment of stock at 40 per cent of its
par value and the earnings even ap-
proximate the estimates, it will be
seen that the estimates are certainly
too low.
With reference to the question of
safety, it enters only to this extent.
How far can the representations be
( verified? Is it true that there is So
100000 worth OF ore in sight? How
can the value of the surface improve
ments be determined? Concerning
the general representations, the gen.
(. tlemen at the head of the enterprise
should be a sufficient guarantee Of
their correctness. As to the amount
and value Of the ore in sight, ocular
! demonstration, supplemented by the
customary methods of computation,
can be made, while photographs and
known cost will decide the price that
should be put upon the machinery and
buildings. The inventory. with the
extensions properly footed show a
4 much higher value than that mention.
ed. sz s h "A 4
Returning again to the question Of
safety: Mining as a business is the
most profitable In the world. It is as
business that we have taken 1t up.
We have the proven mine. We know