8. Unrelated matters.—Similarly, we may say that it is a bad sign when a prospectus contains a discus sion of any subject which is not strictly pertinent to the enterprise in hand. In a published letter relating to the stock and prospects of the Temagami-Cobalt Mines Company, it was said: The diabase peninsula, which our property includes, is a tongue of land extending nearly North and South into the deep waters of White Bear Lake, three miles by canoe from Temagami Station on the Grand Trunk Railway. It is up wards of two and one-half miles in length, and averages half a mile in width. The land rises from the water line on the east and west sides, to a height of about two hundred feet at most, with irregularities and depressions ; there being three main acclivities, including that at the extreme northern point, where the face of the rock plunges boldly into the lake. On the eastern and also on the southern sides, there are low lands, which in wet weather are swampy, with small streams percolating thru them.
The whole peninsula is densely wooded with timber which has never been cut, tho it may perhaps have been ravaged by fires from time to time in the past; there is little soil, except such as is formed by the decay of trees which have fallen during the ages. Beneath this decay there are rough boulders of all sizes, and surfaces of volcanic and sedimentary rock. The trees are mostly tamarac, birch and poplar, growing to a height of 100 feet and more, with foliage mostly at their tops. There is an undergrowth of bushes, and walking is difficult on all parts of the peninsula. The shores are composed of broken boulders or masses of sedi mentary rock or diabase, overhung by trees which grow down to the water's edge.
The description then passes to the geology of the region, and to the ore veins which are declared to be like those at Cobalt. Presently the condition of a nearby property is described as follows: Now on the Crown Reserve mine, for example, which I carefully examined, a section of the ore vein has been de veloped and measured up, two hundred feet in length, by one hundred and fifty feet in average depth, and about eight een inches wide. A shaft has been sunk at both ends of this section, and the ore has been found to run about eight thousand dollars to the ton, or otherwise stated, its value is seventy-five per cent pure silver. This means that the section of ore thus defined contains fifteen million dollars worth of pure silver.
When you consider that the main vein on our property thus far exposed—the West contact vein—is three miles in length, and it is in all respects identical in character and conditions with this Crown Reserve vein, you can appreciate the project which lies before us.
Now what was the object of this preliminary de scription of the lake, and the bold headlands, and the swampy lowlands—of the undergrowth, and the for est trees with foliage at their tops, and finally of the Crown Reserve mine? It served the purpose of get ting the reader acquainted with the writer and the property described. It produced a feeling of friend
liness and confidence. It gave the writer a chance to supply exact details on entirely neutral matters, and accustom his readers to accept them without question. Accordingly, when the great central statement, about which the whole thing was built, was brought out, the reader would be disposed to gulp it down indiscrimi nately along with the rest. The idea was that this central fact should not be weighed by itself, but should be assimilated as a portion of a system of facts, and viewed as a part of a picture, so that, by the weight of the apparent veracity of the matters which were neutral and immaterial, the whole should finally be accepted as a fact! 9. Ridicule of bank rates of interest.—It is con temptible for promoters, who address themselves to persons of small means, to cast ridicule upon the rates of interest which business experience has found it is possible to pay upon deposits which are subject to check or to withdrawal on brief notice.
A promoting company, some of whose officers are now under indictment, when offering one of its projects, said: J. 1'. Morgan is not satisfied with bank interest, he buys bank stock, some of which earns 100 and 150 per cent in dividends. But if you were able to reach the ear of Mr. Morgan and ask him about sane investments, he would say, "Keep inside the 6 per cent limit." Why? Because he takes the high stand that you are not capable of making your money earn all it can earn. This insult to a man's intelligence is thrown in his face every day by bankers.
The following statement from the prospectus of a mining company will come as a surprise to bankers: The banker probably makes several thousand per cent from the use of your $100. Is it a square deal? The banker and capitalists will say it is "conservative." But is it fair? Is it strictly honest to take $100 from a man who does not meet many investment opportunities, and give him nothing to show for it except—a bank book, not even a receipt? 10. Pointing to the rascals.—It is a trick of policy to appear to agree with a radical person in the con demnation of some institution or policy. As it is well known that many honest persons hold in horror the operations of the speculative market, we find pro moters sometimes denouncing speculation, emphasiz ing the unreliability of stock brokers and dealers, and heaping abuse upon poor old Wall Street. If one's own reputation is none too secure, it is supposed to be an act of shrewdness to assume the appearance of virtue by condemning evil with even greater vehe mence than the virtuous.