Montana oil and mining journal. [volume] (Great Falls, Mont.) 1931-1953, 1936-05-02

to the very modest sum Of Fifteen Thousant
Dollars, but BY the year 1882, the total yielc
had reached some Four Hundred Million Dol.
lars. I am using figures published by the on
tario Bureau Of Mines as I recall them. One
mine alone, the Mcintyre Porcupdne had pro-
duced some 90 tons Of gold to the year 1888
: out IN 1911 Il was prospect. In its fiscal
year ending 1888, this mine recovered S.
$4,000 In gold in terms Of the former sos
base, and Us current output Of 1000 tons daily
OF ore Is likely to yield equivalent recoyeries
for many years to come.
These are facts familiar to a large number
OF persons who have derived most handsome
profits from selected investments In tho gold
mining industry in Canada merely che Of
numerous instances Of like tenor.
U. S. Miners Hampered
While this great development was taking
place in Canada, development which gave
her second place in the list OF the worlds
gold producers-now held by the United Soviet
States Republic, the gold miners OF the United
States were greatly hampered owing to the
negative attitude Of capital towards gold
mining enterprises. That Of course Is easy
to understand. The boom in stocks had the
country in its grip. Everyone was constantly
in and out Of the market. Paper profits we're
Imposing; with a long continued bull move
menti the millennium was in sight. one could
buy a stock-any stock-today and sell to-
morrow at q profit. Did the economists tell us
the whole structure was built on sand? Not
tneyi only occasionally was a warning sound
ed, and then but little louder than a whisper.
Why then bother with a gold mine. gold
mining was highly speculative, and not nearly
as fascinating and safe or profitable as
stocks, and so the gold miner had to await
a more propitious time in which to finance
his undertakings. knowing full well his time
would come as verify it has come.
Paper Dollars
Came the crash Of 1929. Signs Of the coming
storm we're many but they went unheeded
The collapse Of the stock market was not the
cause OF the depression which followed but
was merely the first recognized effect OF
= aAaU
credit structure had been built up on an
inadequate supply Of gold. Initiation? It's an
ugly word, the "Banquo at the feast" the
ghost our own bankers had helped create and
would now be glad to be rid Of Initiation?
Why bless our hearts. the expansion Of credit
was only an elementary form Of it, It reached
point where lone gold dollar had to carry
ten twenty, yes and even forty times that
in credit. Our supply Of monetary gold was
enough to carry safely say eight times that
in credit, but as it increased IL became an
inverted pyramid supported on an inadequate
base. needing but a little disturbance to
topple IL over; unstable equilibrium Imagine
II you will, lone gold dollar carrying twenty
to forty dollars in credit, each credit dollar
earning It's five percent annually say, and
you have picture Of each gold dollar earn |
ing from 100 to 200 percent q year Can any
system carry such q burden2 II it
cam then let us expand IL still farther, let
us carry the hypothesis of its logical con-
clusion. let us do away with. gold altogether
and adopt some hypothetical measure OF
taANSs we've just begun TO emerge
rom an elementary form Of It. and with
ne disastrous effects stiil TO be mopped up, Il
leave to your Imagination what the re- 4
iultant chaos will be when and II INITIATION
) Organized and becomes a part Of our do
nestle economy a national policy
This analysis is based on very simple
hough fundamental principles but in that
aspect, 1t Is pretty well recognized that all
latural and economic forces are fundamental
y simple. Reduced to the language OF the
nan on the street, 1t is our old friend the
Jaw OF Supply and Demand which erudite /
entiemen may attempt to disguise, but which 7
hey cannot change. Controlled CURRENCY /
Why indulge in flights OF fancy, when the Z
naestructable Dollar the gold dollar. is in {
ne ground waiting to be dug up and put {
lto circulation? (
Gold Shortage
Mr.. Chairman and gentlemen this associa- I
on represents the rank and file OF a great q
ldustry. We know the industry needs no $
efense but we must know the facts and G
nalyze them in terms OF the well being of u
ais country There is today a shortage Of :
DID, shortage which has been accommodating .
" century or more, unannounced excepting Il
matter OF statistics, unrecognized as the Q
ement In our present industrial Ills the q
ost widespread depression Of all time. Il was s
? It's way before the outbreak of hostilitfes s
1919 the war simply stemmed It's advance ?
u the moment. The postwar period lulled n
INTO sense Of security, but we have to
naly return to fundamentals In that short
se lies the cause Of our industrial ills today o
I'd not until that shortage is remedisd win n