The Express.
London, England, 1853-04-08 00:00:00

821. 10s. Three-and-a-Half per Cent. Stock, not
redeemable before sth January, 1894, an arrange-
ment by which the nation will pay an interest of
21. 17s. 6d. per cent. per annum for 40 years, and
will, further, have reduced the capital of its debt at
the eau of iat period by 171. 10s. per cent.:
Or, 1101. Two-and-a-Half per Cent. Stock, also not
redeemable before the sth January, 1894, an offer
which gives the holder of the stocks proposed to be
redeemed an annual interest of 21 per cent. for 40
years, the nation finding itself saddled at the end of
that period with an increase of 10 per cent. in the
nominal amount of its debt, an increase, be it marked,
exactly equivalent to the nation's saving in interest
during the 40 years.
Or 1001. Exchequer Bond bearing 21 per cent.
annual interest for a few years, not longer than ten,
and then bearing 21 per cent. till 1891,with coupons
attached, with interest payable to bearer halfyearly,
and with the option a redeeming the bonds in 1894
to rest with the government, or with the bondholder,
as may be agreed at the time of issue. This ie by
far the simplest and most natural arrangement.
After the sth January, 1854, the interest on the
above-named 3 per cent. stocks proposed to be com-
pulsorily reduced shall cease, and parties not ac-
ceding to the government proposal shall be paid off.
Holders of Consols or Reduced may also convert
their stock on giving notice by the 10th October,
1853, into either of the new stocks or Exchequer
Bonds on the same terms.

No limit is apparently fixed to the issue of the
new stock., but the amount of the new Exchequer
Bonds shall not exceed 30 millions sterling.
Trustees converting stock are to be indemnified.
In all city circles the scheme has occupied atten-
tion to the exclusion of every other topic, and even
of business. The chief serious objection is to the
proposed creation of a 21 per cent. stock, involving
an addition of 10 per cent to the capital of the debt.
This proposal is considered inherently vicious and un-
sound; for, as will be seen on calculation, the nation
will find itself at the endof the 40 years in almost the
same position as now, having saved 101. per cent. in
dividends and handed over 101. per cent. in stock.
The offer of a Three-and-a-Half per Cent. stock
issued at 821. 10s. per cent. is regarded with more
favour, as it recognises the soundness of the prin-
ciple so strangely ignored in the proposal censured
above, viz. the principle of effecting a diminution of
the nominal capital of the debt. Favourable suf-
frages, however, are chiefly centred in the proposed
inane of Exchequer Bonds, bearing a diminished rate
of interest, firstly 21, and afterwards 2fr per cent.
Indeed this is evidently the strong point of Mr.
Gladstone's scheme. The reduction of income to par-
ties who convert into these bonds would be gradual,
and consequently not so strongly felt. It is evident
the government intend to discontinue altogether the
issue of Exchequer Bills, and these bonds would
naturally take their place, by which means alone a
considerable amount would be absorbed. Another
most important point consists in the fact that
throughout the Continent these bonds, with the never
impeached guarantee of Greet Britain,would be held to
an immense extent, as a medium of investment for
capital lying idle. The distrust in continental seen-
rities of- all kinds is wide-spread; equally wide-
spread is the confidence in British finance; and by
issuing bonds to bearer, with coupons attached,
British bonds would be held in every quarter of
the world, instead of, as now, only by parties who
can travel to London to receive their dividends, or
who adopt the expensive plan of giving powers of
attorney, and having their money transmitted to
them. There can be little doubt the demand for
these bonds from all quarters, at home and abroad,
would be such that they would rule at a good pre-
mium; this premium would of itself tempt
holders of Consols to convert into the bonds;
provided the option were still open to them,
and thus a gradual conversion of our Three per
Cent. debt into a Two-and-Three-Quarters, and then

into a Two-and-a-Half per Cent. stock would be
effected, without any violent change, and conse-
quently in the manner most desirable.
Such are the views expressed in the best informed
City circles. Whilst, however, the details of the
scheme are thought capable of improvement in
some points, and with an impression that the
scheme is unnecessarily complicated, the attempt of
Mr. Gladstone to grapple with the difficulties of this
momentous question is viewed with the liveliest in-
terest and satisfaction. The entire project is re-
garded as an experiment having for its object the
ulterior reduction of the interest upon the whole
Three per Cent debt of the nation, and a decidedly
favourable influence is exercised from the undeniable
proof which it conveys of the prosperous state of the
finances. Till the fate of the project shall have
been more clearly defined, the position of the
several security markets cannot be considered fixed, bu t
the tendency is unmistakeable and strongly upwards,
Obi. should the measure be carried to a successful
issue either on a modification of the present proposals
or on some other satisfactory basis, a very remark-
able appreciation of all sound securities must ulti-
mately occur. The immediate impulse given to the
markets, it may be observed, is in a considerable
measure owing to the circumstance that such of the
dealers as are oversold, and the 1. bear" party at
large, have been rendered intensely anxious by the
government announcement, and have naturally
rushed into the market as purchasers, with a view to
covering themselves from further and possibly consi-
derable loss.
The business in the English funds has been ex-
tremely active. On the precise nature of the Chan-
cellor of the Exchequer's proposals becoming known,
Consols opened 1001 to for money, and 1001 to 101
for the 13th, representing a rise of upwards of 1 per
cent. since yesterday, and, after receding to 1001 to
1, closed 1001 for money, and 1001 to for time.
Following the view taken by us of the relatively in-
creased value of the Three-and-a-Quarter per Cent.
Stock, there was a rise of fully 1 per cent. in this
security, which, however, was not fully maintained
to the close. The official business report is as fol-
lows :—Three per Cent. Console, for money, 1001, 1,
1; ditto for account, 1001, 101, 1001. Three per
Cent. Reduced, 100, 1, 991. Three-and-a-Quarter
per Cents., 1031, 2, 103, 1,1. Three per Cent. An-
nuities, 1726, 1001. Long Annuities,lB6o, 6. India
Stock, 262.
There was no change in the floating debt. Ex-
chequer Bills, both March and June, are marked 6s.
and 10s. prem. ; and India Bonds, 435. to 48s.
prem.
Foreign stocks have also benefited, but more in
tone than price. Mexican reached 281, and closed
271 to 28. Spanish Bonds were firm, and the Cer-
tificates further improved, leaving off SI to per
cent. Greek Bonds were again rather better at 91
. Peruvian Scrip was also higher, reaching 41
prem. Dutch, Brazilian, and Equador Bonds
showed an upward tendency, and generally the
aspect of this market is improving. The
list of sales is annexed : Brazilian Four-
and-a-Half per Cents. Bonds, 1852, 981, 09.
Danish Five per Cents., 105. Dutch Two-
and44-Half per Cents., 66, 60",; ; ditto, Four per