The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1917-12-27

solidated Copper company, CHINO Cop
per company and Ray Consolidated
Copper company, as represented by
market quotations, was in the aggre-
1gate almost four times their par value.
The stock of Utah Copper company OF
a par value of little more than $16,-
100000, was worth at market quota
tons upward of $S1, 900, 900. The stock
of Nevada Consolidated Copper COM
pany of par value Of little less than
$40, 100000, was worth at market quo
tations approximately $30.000,000. The
stock of the Chino Copper company,
OF par value of about $4,300,000, was
worth at market quotations little
Hess than $33,500,000. The stock of
Ray Consolidated Copper company, of
a par value of about $15,750,000. was
worth at market quotations upward of
$2S, 100000. The Utah Copper COM
Ipany stock and the Ray Consolidated
Copper company stock each has a par
value of $40 per share, while the stock
of the Nevada Consolidated Copper
company and Chino Copper company
each has par value of IS per share.
All of these stocks are listed on the
New York and Boston stock ex-
changes In the aggregate these
stocks Of a par value of about $46.-
100000 were worth at market quota
lions upward of $173,5OO,OOO.
This demonstrated value of these
stocks was due entirely to the fact
that the mineral deposits owned by
these companies on further explora-
ton were discovered to be more extern
sive than had been assumed at the
time they We're organized, so that the
value thus set upon the stock in jan
uary, 1914, was an appraisal by the
public of the mining properties 1t
represented In effect the price at
which the owners could have sold
them, and, to some extent, did sell in
the best data available from which to
calculate the invested capital of these
companies.
The injustice to which these COM
palies and their shareholders would
be subjected If the value of these
properties as of January /, 1914,
should be limited to the par value of
the stock originally issued therefor,
and If these companies should be de-
MED the opportunity of showing the
actual value of their properties as of
that date, is apparent. 1t is also APP
parent that if such a limitation should
be imposed upon these companies the
loss ensuing would be the direct con-
sequence of the honest conservatism
of the bankers who organized them. 1t
is entirely obvious, to take single
Illustration from the foregoing, that
IL the Utah Copper company had issu-
ed stock to the extent of $S1 200, 900
for its properties, instead of adopting
the conservative course which its or
ganizers chose the company under any
construction of the law would be per-
mitted to count its mining properties
as worth on January /, 1914, the sum
of $S1 100000.
Stock Watering Condemned in Earlier
Statutes.
Stock watering and the issuance of
inflated stock have been condemned
alike by state statutes, economic writ
ers and publicists generally A con-
servative course in the issuance of
stock against properties not fully de-
veloped has been universally COM
mended. If these companies and their
shareholders are forbidden the right
to value their mining properties at
their fair value on January /, 1914,
merely because comparatively small
amount of stock was issued against
these properties in the first instance,
then direct and severe penalty Is
imposed because of conduct that has
heretofore been commended. and by
the same token a premium Is put on
practices that have heretofore been
condemned. We have made mention
OF the value OF these stocks as of jan
uary l, 1914. because that is the date
fixed in the law for the ascertain
ment of the invested capital of a COR
poration whose properties were ac-
Quired prior to that date 1t is not
date selected by us with view to OBJ
tanning thereby a high valuation for
these stocks and thus adding force to
our argument. On the contrary, the
price of copper at that date had not
felt the effect Of the enormous de.
mand induced by the war nor does
that date fall within a period of high
prices on the stock market. The av-
erage price OF copper for the month of
January, 1914 was 14.45c per pound,
as against an average. price for the
year 1916 of 2S46c, These stocks
which on that date had an aggregate
value of s173, 100000 have reached
much higher value since that date. In
the discussion of this particular point
we have made no mention Of the Chile
Exploration company or of the Braden
Copper company for the reason that
these two companies seem to call for
separate treatment.
Actual Value of Property Should Be
Considered.
We have no doubt that the hardship
and injustice which would result from
forbidding these companies to show