FOREST FINANCE 



PARAGRAPH I.— INTRODUCTION. 



I. Definition. 



Forest Finance deals with forestry as an investment. 



Treated as a branch of science in European literature, it consists of two 

 parts : 



First Part: Forest Valuation which ascertains the values of forest in- 

 vestmoats and the values of their components. 



Second Part: Forest Statics which compares the iavestments with the 

 returns obtained. 



Forestry, from the standpoint of a commonweal (federation, state, county, 

 town, city) deals, to a large extent, in abstract or ideal values, — values which 

 are not expressible easily in dollars and cents. It neglects, usi:ally, financial 

 considerations entirely or partially. 



With the private owner of forests, the financial outcome of his invest- 

 ments is the first and last consideration. The private owner cannot bo ez- 

 f-ected to supply this country wiih forest products unless forestry is as remun- 

 erative an investment as agriculture is found to be, or as manufacture is sup- 

 posed to be, — ^industries which supply this country with food products and 

 with manufactured products. 



The mathematical principles involved in Forest Finance are identical v/ith 

 those confronting the bankers, the insurance companies, — in fact, confronting 

 sll business men and all business enterprises that look ahead into the future. 



Forest statistics, deficient unfortunately in the United S;ates (as in any 

 other country of rapid development), are important as a basis for financi?.l 

 calculations. 



Forestal forecasts in the countries famous for conservative foresiry are 

 made easily and v/ixh a high degree of certainty. 



In Canada, in Russia, and generally in the United States, such is not 

 the case. 



II. History. 



Forest Finance is one of the most modern branches of forestry. Abroad, 

 it was unknown, or unheeded by the practitioners, previous to Mzn Pressler 

 (about 1860). Pressler's theories were developed and enlarged upon by Gus- 

 tav Heyer. 



Dr. Wra. Schlich's, and Prof. Charles V.'^immenauer's writings are entirely 

 in line with Heyer's teachings. 



Financial considerations were despised generally by European foresters 

 until recently. The government of Saxony was first to adopt financial suc- 

 cess as the goal of its forest policy. 



