s





UPPLEMENT  TO







Real Estate Record.





TO WHOM IT MAY CONCERN.
The Eecokd presents to its readers to-day a
supplement containing hints which may prove of
Talue to those 'wise enough to heed them. It
seems to be an] opportune time io call upon in¬
vestors to halt and examine more closely than
they have hitherto done the various plausible
schemes which of late seem to be so temptingly
spread before them, and it]is the wish of the editor
of The Eeooed to lay before its readers in char¬
acters so large that he who runs may read, the
extreme danger that they are in should they allow
themselves to be seduced into putting their monej
into these worse than wild cat enterprises, for such
must be called nineteen-twentieths of all the
mining stock companies'^to be found, in New York
to-day.

In doing this we are well aware that wejare tread¬
ing upon the corns of many who are already rich
men,and more who hope|tojbe,Jbut thatjfact does not
deter us in the least, and should this note of warn¬
ing so much as save even one of [the reaaers of
The Record frwn an unwise investment the editor
of this paper wili not consider the work as having
failed of bearing fruit. We believe that anything
worth doing at all, should be well done, hence in¬
stead of distributing'what we have to say in a
series of articles in The Recokd, we at once launch
out with enough of them to atti-act attention to the
subject matter interested.

The working of gold and silver mines is, in it3elf,
a perfectly legitimate industry. If conduQted by
individuals, business firms or private corporations,
it is, we believe, a reasonably lucrative means of
investing money. Senator Jones, m his speech in
the Senate on the silver question, doubted whether,
on the whole, mining investments paid more than
4 per cent., that is, taking the entire expenditures
and offsetting them against the total bullion
product.

The public hear all about the great strikes in the
bullion mines, but there is no record kept ot the
heart-breaking failures; of the vast sums of money
invested, of wnich there is no return, nor hope of
any. All the great prizes in the lottery of business
are very rare aud mining is no exception to the
rule.

We publish this supplement as a " danger
signal," to warn the investing public against the
excesses which have characterized previous specu¬
lative frenzies, such as the petroleum fever and the
speculation in railway stocks which ended so
disastrously in 1873. We do not promise to keep
this matter up. We publish it in supplement
form so as not to interfere with the regular matter
of The Real Estate Recoed. If there should
prove to be a demand for a journal dealing honestly
with mining or other investments we may con¬
tinue these supplements or isauea paper designed
especially for the information of investors in
securities. In any event we have done our duty to
the wealthy interest represented by The Real
Estate Recoed by issuing this one supplement.





THE PATHER DE SMET.
We have every reason to believe that this is one
of the finest properties in the Rlack Hills, but
nevertheless v^e warn the investing public that
there is a risk in purchasing it. There are three
factors to be considered in purchasing the shares
of a mining company. In the first place the prop¬
erty must be a good one. In the next, it must
be wisely and economically handled, and last, but
not least, it must be honestly managed.

We have admitted that this property is a good
one. We do not know that it is dishonestly or
unwisely managed, but in view of the fact that it
is a California property in the hands of Cali¬
fornians, that it is selling for a much higher price
in New York than it ever could command in the
State where it is organized, and also from the fact
that it is an assessable property, we would advise
our readers to keep clear of it. The Pather De
Smet is owned mainly by "Archie" Borland, a
shrewd and lucky Pacific coast operator, originally
a working miner, who has made his money by
driving good bargains, by understanding his busi¬
ness, and, like most rich men of the Pacific coast,
by getting the best of those with whom he had
dealings. Mr, Borland brought this property to
New York, it having a splendid reputation in
mining circles. He was, it seems, unable to affect
a sale to New York capitalists after trying
the market for several months. He had the
advantage of Dead wood and Homestake, sell¬
ing at extravagantly high figures. His is as
good if not a better property, and it is now
offered at a less price than they are selling
at on this market. People who purchase the
Pather De Smet should remember that it is
managed by Pacific coast operators, and that it is
assessable stock, organized under the laws of Cali¬
fornia. They should remember that sometime or
other all California stocks are assessed. No mat¬
ter how good the mine, the assessment comes
sooner or later. If we are not misinformed, cer¬
tain New York capitalists examined this property
but did not purchase it, and the reasons would not
be far to seek. The Black Hills are distant, the
grade of the ore is low (from seven to ten dollars to
the ton), to make a profit it requires an immense
outlay for machinery and very economical man¬
agement. There must be no waste, and there
must be no mistakes. The prices at which Home-
stake and Deadwood and the Father De Smet are
ofl-'ered to the New York public is altogether too
high. At thirty cents a month per share mining
property should never sell for more than ten dol¬
lars. Indeed, the axiom is frequently laid down
by those who understand mining that no stock
should be sold for more than fcwo years' pro¬
duct. The price of Homestake is absurd. True,
it is an immense mine, a huge gold quarry, bufc
the grade of the ore is low, the amount of ma¬
chinery necessary to use and use up is very large
(two hundred stamps are now employed) and yet
the yield does not begin to compare with that of
the Standard mine in Bodie, which employs only
thirty-five stamps. Even the Lifcfcle Bodie Con-
solidafced, with its ten stamps, has turned out far
more in a month than the Homestake with its two
hundred stamps. Then we do not yet know what
change will occur after the water level is reached.
So we tell our readers thafc if they buy into the
Father De Smet they are assured of pufcfcing their
money into a good mine, only it is too high
priced. Ten, or, afc the most, twelve would be
the proper markefc valuation, but even then, not
knowing who the managers are, and the property
being afc such a distance, there is no assurance





that in the long run the shareholders will get
their money back.

LITTLE PITTSBURG REVELATIONS.
The Mining Record deserves a greafc deal  of
credifc for having given to the public a full list of
the stockholders of the Little Pittsburg Mining
Company, together with the amount of stock "held
by them just previous to the break in the price.
If a list of the stockholders after the stock was
first subscribed for could also have been furnished,
it would have been still more valuable, but even
the present one will attract a great deal of atten¬
tion, especially from persons who are loaded with
the stock, which they bought upon the recom¬
mendation   of   the  directors  and  others,   who
seemed to have got oufc of their stock before the
break.    Of course, all the directors of the Little
Pittsburg   are   high-minded   gentlemen.     They
stand very high in the community, and are sup¬
posed, naturally, to be men of wealth and repute.
They gave their names to float the stock of the
company; they induced their friends to subscribe.
We have henrd pitiable stories of poor people,
women and others, who came to the oflSce of the
company when the stock broke below twenty, to
ask what was the matter.   They were told it was
a raid upon the part of Gill and some others for
stock jobbing purposes.     They did not suspect
that the mine had been gutted and badly man¬
aged, nor did they dream that the very respect¬
able gentlemen, who formed the Board of Direc¬
tion were so well'aware of the true state of the
case that they had  disposed of their holdings
while the price of the stock was sfcill high.   Gene¬
ral Charles C.  Dodge is a very reputable and
wealthy   gentleman.     The   firm   of   Dodge   &
Potter  sold  large  quantities  of   the  stock  oi
the    Little    Pittsburg,    but    it    seems    that
General Dodge himself, if this publication is cor¬
rect, owned only one hundred shares on the 13th
of this month.   Of course, being an honorable
gentleman, he must have informed all his friends
and customers whom he induced to purchase the
stock  to sell afc the proper time.   Mr.  Henry
Havemeyer, also one of the directors, was very
active in getting the stock  placed, yet he, it
seems, had only one hundred and twenty-five
shares when the list was taken, although W. J.
Havemeyer is down for seven hundred.   Mr. C.
L. Perkins, another director, had only one hun¬
dred shares, at last accounts.   Mr. J, E. Babcock,
another director, does not appear in the list afc
all.     Mr. Dam had in his name some thirteen
hundred shares when the stock broke.   Ifc will
strike him as remarkable that his associates on
the Board were so much more lucky than he was.
Mr. H. A. W. Tabor, also, the honest millionaire
miner from Leadville, who made such immense
sums of money out of the original sale of the
Little Pittsburg, is down for one hundred shares.
Some little bird must have told him what was
coming.   Then the honorable Ex-senator J. B.
Chaffee, who fathered this great enterprise, and
who added to his enormous fortune by another for¬
tune in seUing the mine, is down for only one hun¬
dred shares.   Px-om February 21 to March 5, he
and Moffat transferred fifty-one thousand shares.
Ex-Congressman Abram Hewitt, the honesfc poli-
fcician, owned originally, ifc is said, four to five
thousand shares of fche stock Doughfc, ifc is be-
ieved, upon the recommendafcion of his partner,
Rossiter Raymond, who was the expert chosen to
examine the property.   He seems to have sold
out and did nofc have a share of stock in his name
when the break occurred.   Now, who told Mr.