Smart Silver

Five notable results of President Roosevelt's silver purchasing policy have been: 1) a panic in China, 2) temporary dislocation of the Mexican banking system, 3) enrichment of a number of speculators at home & abroad, 4) accumulation of an enormous hoard of bullion which the Treasury may never be able to sell and 5) booming bar trade in all the mining camp saloons of the Mountain States.

Last week the saloons in Virginia City, Nev. rocked with reports that "Eastern interests" were ready to put new money into old mines of the Comstock Lode, from whose steaming depths some $700,000,000 worth of metal has been blasted since its discovery in 1859. In the purple days of the bonanza kings Virginia City was an easy-money centre of 30,000 people. Today it is a ghost town of 488.

This week in Virginia City merger of four of the most fabulous Comstock mines will be broached--Ophir, Mexican, Andes and Consolidated Virginia. Only "Eastern interest" to admit his connection with the deal was John Jacob Raskob, identified in the local Press as a "New York contractor." With his wife, the onetime Democratic National chairman was at nearby Lake Tahoe.

Though the money for modernizing the Comstock mines was reported to be in the hands of a "Raskob-Baruch-Pittman" group, both Nevada's Senator Pittman and Bernard Baruch denied any financial interest. However, the Silver Senator admitted that he was advising Mr. Raskob as counsel.

In the early days of Depression a gold boom hit the mining States. It was followed by a silver boom which hit its proper pace this spring after Secretary of the Treasury Morgenthau squeezed silver prices to a high of 81-c- per oz. (Depression low: 25-c-). Secretary Morgenthau has currently let the price slip to 68-c- but by law he must continue buying until either his silver stocks amount to 25% of his gold stocks or the price goes to $1.29 per oz., the more likely alternative.

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