e to maintain mechanical
efficiency under detail expansion.

OVERPRODUCTION OF BASE METAL.--Were this intensity of production of
general application to base metal mines it would flood the markets,
and, by an overproduction of metal depress prices to a point where
the advantages of such large-scale operations would quickly vanish.
The theoretical solution in this situation would be, if metals
fell below normal prices, let the output be reduced, or let the
products be stored until the price recovers. From a practical point
of view either alternative is a policy difficult to face.

In the first case, reduction of output means an increase of working
expenses by the spread of fixed charges over less tonnage, and
this in the face of reduced metal prices. It may be contended,
however, that a falling metal market is usually the accompaniment
of a drop in all commodities, wherefore working costs can be reduced
somewhat in such times of depression, thereby partially compensating
the other elements making for increased costs. Falls in commodities
are also the accompaniment of hard times. Consideration of one's
workpeople and the wholesale slaughter of dividends to the then
needy stockholders, resulting from a policy of reduced production,
are usually sufficient deterrents to diminished output.

The second alternative, that of storing metal, means equally a
loss of dividends by the investment of a large sum in unrealized
products, and the interest on this sum. The detriment to the market
of large amounts of unsold metal renders such a course not without
further disadvantages.

SECURITY OF INVESTMENT.--Another point of view antagonistic to
such wholesale intensity of production, and one worthy of careful
consideration, is that of the investor in mines. The root-value of
mining stocks is, or should be, the profit in sight. If the policy
of greatest economy in production costs be followed as outlined
above, the economic limit of ore-reserves gives an apparently very
short life, for the ore in sight will never represent a life beyond
the time required to justify more plant. Thus the "economic limit
of ore in reserve" will be a store equivalencing a period during
which additional equipment can be redeemed from the "saving of
fixed charges," or three or four years, usually.

The investor has the right to say that he wants the guarantee of
longer life to his investment,--he will in effect pay insurance for
it by a loss of some ulti