The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1919-05-01

biggest fortunes are made during the
early stages Of development; on the
whole, more money is made by selling
than by buying mines, simply because
the final or so-ealled investment
stage of first class mine is likely to
represent an generalization, caused
by an erroneous superstition that the
essential hazard is precuded I
would even say that more money has
been lost by the over valuation of the
great rich mines of the world, like the
Con. Virginia, Mount Morgan, Broken
Hill and Nipissing, than in a multi
tude of worthless prospects. Small
men lose their money in big mines
and big men in small mines. The in
ference therefore is not to try to get
rid of the essential risk-because 1t
can not be done-but to require rate
of profit proportionate to it. A much
more intelligent policy is to engage
in such mining as allows a liberal
margin both ways, taking a larger
risk for the sake of the larger gain,
that is, to speculate with eyes wide
open, and not to invest with eyes half
shut
Fifteen years ago the careful SAM
ping Of ore as means of valuing
mines was becoming advanced to an
art and the tendency was to place too
great reliance upon it, with the con-
sequence that capitalists began to
think themselves safe in buying ore.
They thought to escape the essential
risk by assuring themselves return
of their money, diminishing the spec
ulative features of the business as
much as possible. Exploration COM
panies We're organized in London,
New York and Boston to scout for
promising mines on which to apply
the newly developed methods of val
uation Most of these seekers after
bonanzas We're disappointed; they
failed to repeat the successes Of the
pioneers in this type of mining fin
ance-such as the Exploration COM
pany of the Hamilton & Smith era
because they were too timid; they ex-
pected to have their money in sight
when they bought mine; they were
looking for a bet on a sure thing,
with all the profits of a speculation.
They lacked the temperament needed
for adventure and should have placed
their money in bank, where at per
cent, it would double itself in Is
years. Many directors of these ex-
ploration companies bluffed them
selves into the idea that they were
bold navigators when as matter OF
fact they were only fair weather sail
ors
AS / remarked at that time "ore
reserves are not everything. expan-
sion and development are the essence
of successful mining" The big sue
cesses have been made by developing
prospects into mines, not by buying |
blocks of ore that have been exhaust
lively sampled by meticulous young |
men. The profit to be made must de-
pend upon the further extension of the
GRE; the larger the proportion Of ore
already proved the smaller the posi-
bilities beyond AS Mr.. Hoover point
ed out, the probable depth of extern
sion is more critical than the proper
ton of profit in sight. He worked out
rough rule for the gold mines OF
western Australia, namely, the mini
mum extension of an ore body IN
depth should be not less than one
half it's length He called it a yard
stick for use in forming a Judgment
but he laid stress on the need for in
vestigating the characteristics Of the
individual ore body, more particularly
it's geologic structure and that of the
district in which it lies. Such rough
and ready formula, however, would
fit only the mines that are dependent
on one or two large shoots; it would
be of little service in the valuation or
mines depending on series or recur-
ring ore shoots, as, for example, the
Goldfield Consolidated, in Nevada, the
Nipissing, at Cobalt the Yoquivo, in
Mexico. Mr.. Hoover made the shreWd |
observation that "the quantity OF ore
in reserve is a matter of management
not necessarily dependent on the size
of the mine" In 1912 Morton Weber |
protested against the use of formulas
in mine valuation and showed that
"the relative magnitude of the ore re-
serve in any particular mine is large
ly a matter of administrative policy"
/ myself remember, when practicing
as a mining engineer, advising a
client not to extract the ore in his
mine if he hoped to sell it to advan-