Show BABSON'S AUTHENTIC tr STATEMENT w sibs Bab Special to THE EXPRESS BABSON CONTINUES DISCUSSION OF INFLATION TION HEDGES BABSON PARK MASS MASS- MASSA MASSA A sound investment program should provide protection against inflation as well as deflation Because real estate is so commonly associated with inflation protection it might be well to lead off with witha a discussion of land trusts Real Estate Trusts The quality better land companies have several ad vantages 1 While some of the older companies originally garnered their land for agri cultural purposes in recent years the discovery of miner als has introduced a kicker to companies of this type 2 There is usually a basic source of in the form of sur sur- sur I face leases water rights etc 3 These companies operate with little in the way of plant and equipment investments 4 Their labor and other oper opel sting costs are at a minimum One of the largest domestic land trusts is Kern County Land Company It owns near near- nearly 1 ly 2 million acres in Califor- Califor California nia New Mexico and Ari Ari- Arizona zona and participates in de- de development development of oil and gas pro pro- properties in Western Canada Louisiana and Mississippi and even Australia Another large land comp comp- company company any is Texas Pacific Land Trust owner of about 1700 acres in Texas In 1954 this company transferred to Oil Corp most of its oil gas and other mineral rights rightson on its then producing proper proper- property ty It retained title to virtually all the surface land a small perpetual royalty interest in producing acres and a 1 royalty in future min min- mineral eral production from acres Established Mining Companies Mining issues provide an an- an another other hedge against inflation In a sense mineral deposits are arc sort of underground bank deposits Improved mining techniques development of I machinery capable of massive ore extraction and new meth- meth methI methods methods of upgrading ore quality I I help to offs offset t effects of rising labor costs Best investments are in companies with large ore reserves and undeveloped acreage The American Metal Cli Cli- Climax max Company has many at at- at attractive features This comp comp- company any holds land In Africa Mex Mex- Mexico ico Canada and South Amer Amer- America ica Domestic properties are located in Colorado New Mexico and Michigan Amer scan lean Metal Climax produces more than half the worlds world's supply of molybdenum and owns the worlds world's largest moly moly- molybdenum mine The company also has large Investments in African copper mines It is a large custom smelter and sell sell- seller seller er of nonferrous metals Oth Oth- Other er lines include a potash mine and refinery in New Mexico plus oil and gas interests Copper Properties The major copper mines also hold merit for Investors Interested in underground mineral deposits Copper is the worlds world's largest copper mining company Its Utah and Chile operations are exceptionally low cost Ore re- re reserves reo serves of the company are substantial in vestments include a 67 ow- ow ownership ownership of Quebec Iron and Titanium and a 13 interest In Kaiser Aluminum The worlds world's second largest copper producer is Anaconda More than two thirds of its copper Is mined in Chile In addition it has mines in Mon Mori Lana tana and Nevada and In Me ice ico Anaconda is also a leading fabricator of copper and pro pro- processes uranium and aluminum num Operating costs of its foreign mines are low Second largest domestic copper producer Is Phelps Dodge which is a favorite of mine Nearly all of its ore output out out- output put the bulk of which is min min- mined ed in Arizona Is used by its fabricating plants It has a 16 Interest In Southern Peru Copper and sizeable in in- in investments vestments in Amerada Petrol Petrol- Petroleum eum American Metal Climax and New Jersey Zinc A very interesting article on Arizona appears in the March National Geographic Copper Range is an Import Import- Important important ant copper producer in the Luke Lake Superior region Though It Is medium sized and a re- re relatively relatively high cost producer it itis itis is fully integrated from mines to market Turning to the base metals United States Smelting Re- Re Refining Refining fining and Mining Company is isa Isa a leading producer of lead zinc copper silver gold and even coal Most of its mining properties are arc in New Mexico and Utah Company is Increasing increasing ing its emphasis on oil and gas development It holds leases royalty claims and mineral options on acreage in various US mountain and plains states and in Western Canada |