INCREASE IN PRODUCTION OF GOLD. 641 



annual output would be smaller. On account of this fear the 

 " Kaffirs " (South African gold-raining stocks) suffered a decline in 

 the London stock market some months ago, but the statistics showed 

 that the output during the first half of 1898 was larger than in the 

 previous half year, and in the latter months of the year the increase 

 was even more pronounced. 



In an address given before the Mining and Metallurgical Section 

 of the Franklin Institute on Mining and Minting of Gold and Silver 

 in November last, the writer said that the production of gold in South 

 Africa in 1898 would not fall far short of $70,000,000, and would 

 probably be nearer $80,000,000. The estimate of the Director of the 

 Mint fixes the amount almost at the latter figure. The United States, 

 in spite of the considerable increase over 1897, takes second place as a 

 world's producer of gold, Africa having contributed in 1898 an 

 amount*equal to that of the United States and Canada (including the 

 Klondike) combined. 



The startling announcements of discoveries of virgin gold in the 

 Klondike and of rich placer gold deposits in other localities have had 

 little to do with the enormous increase in production of gold in the 

 world in recent years, though formerly such discoveries constituted the 

 main source of supply of the precious metal. Digging for nuggets is a 

 lottery pure and simple, in which a few prizes are obtained and many 

 losses are suffered. It is said that for every dollar in gold taken out of 

 the Klondike to date, two dollars have been carried in, and this is per- 

 haps a conservative estimate. In fact, it is easy to prove by figures, if 

 the value of labor be counted even at the lowest wage rate, say one 

 dollar per diem, that far more money has been lost by the many gold- 

 seekers than has been gained by the few fortunate ones in this twen- 

 tieth-century search for the golden fleece. 



The business of extracting gold from low-grade ores by scientific 

 methods on a large scale, where the precious metal is evenly dis- 

 tributed throughout the matrix or gangue, is a legitimate field for the 

 investment of capital, because the element of chance is reduced to a 

 minimum, and even may be eliminated altogether. The margin of 

 profit per ton of ore is not large as a rule in these operations, and thus 

 the stability of value of the product is assured, whatever the output 

 may be. 



" Treasury Department, Bureau of the Mint, 



" Washington, D. C, February 1, 1S99. 



■" Alexander E. Outerbridge, Jr., Pli iladelphia, Pennsylvania. 



" Sib: In answer to the inquiries in your letter of January 31st, 

 I take pleasure in sending you such information on the production of 

 gold in the principal gold-producing countries in 1898 as is at this 



VOL. LIT, — 48 



