Cleveland morning leader. [volume] (Cleveland [Ohio]) 1854-1865, 1864-08-06
Goverhmeiit seeurities e an Invest.

| There is one view Oh lnYesJments IN
/ Government stocks which has not been
generally taken. If taken by shrewd cap
italists and Spectators II has not been gem
orally considered by the people. 1t is this:
When, after long suspension, specie pay
ments are resumed, all stocks and prices
Immediately and largely decline, but Cor
nasnt stocks DO NOT materially decline. This
fact We assert on the ground ofhistorieal er-
perience. It is true that in the War of
1925 Government stocks fell, at one
time, to 20; but most of the banks were
then suspended or bankrupt, and there was
comparatively little currency in the coun-
try to buy stock with. But suppose the
gold value of Government stocks were this
day 20, the lowest they were ever till now
sold att the market value at the present
rate of gold would be 1876, while in fact the
stocks are selling below 1O5. Surprising,
then, that the market price o. Government
securities were, by the resumption of spe-
Gle payments, to go down to 70 in july, the
decline would be 35 on lO5, equivalent to
80 IL per cent, while the decline on a rail-
road stock would be nearly or quite equal
to the whole present difference between
gold and paper. A common railroad stock,
| selling now at 1Oj, would decline to So. or
in the best supposable case, to so. This is il
lustrated by the history ofevery suspension
ofspecie payments we have mad, and there
are many business men who will reccolTect
what the prices OF produce, stocks and all
salable commodities were after the CONNER
eial revulsions of 1887 and lS39-4O. In
IS4l, AZ and SO, prices were reduced to q
degree now scarcely credible. But Go7er1t-
meat stocks did not fall materially. On
the contrary, it is a settled principle de-
arcuted from all experc rcnce in England and
this country, thet GOve,na,e0t .tuodS DO not
fuetaate to the same e1tent rs c5tcy Kinds Of
pcoprty. There is good reason Tor it. The
time. rate Of interest, and security are all fix
ed and per manent. There may be some
variations in the market price, owing to
the'grestsr or less bulk of the entire cur
reney. but there can be none IN the in
trinsie value; and hence it is, that histo7'-
icaIly the fluctuations in tho value of Gov
ernment stock have been comparatively
small. In allthe recent commercial Iauctu-
ations of England lin some of which there
has been complete prostration of all other
property, thovariation in British consols
has not been over five or six per cent
This cannot be said of any other kind of
stock Of railway and bank stocks the
great variations and at times wonderful de-
probation arc notorious. Sudden CONNER
cial revulsions have reduced these stocks
to one half their price. Suppose, then,
that with gold at 80 now, and Government
stocks at 1867 there should be resumption
of gold payments in one year, land this is
a supposition which may become a faet.)
what would be the relative effect on these
kinds Of stoek-say Government at lO5,
bank at lls, and railroad at 120? In all
human probability the resumption of gold
payments in a year would bring them to
these relative prices, viz, Government, 80;
bank, So; railroad, 20.
Judged by histoircal experience this would
be nearly the rclattce result. The conse.
quence, then, is that the Government funds
depreciate l6 per cent, the banks 25, and
the railroads so. Itis more probable, ifthis
statement be thought erroneous, that the
actual result would be much more in favor
of Government. But we merely give this |
as an illustration of a general historical
truth, that on the resumption ofspecie pay
ment, or on the occurrence OF a great com
mercial convulsion, the fall in Government |
stocks will be far less, relatively, than the
fall in any other kind of stocks. The |
practical iaterencc from this is plain. The /
purchase of Government stocks being made
for investment, it is a far safer and more
profitable Investment, for the .futare, when
gold payments will be resumed, than any
other. .i ftt
No body can doubt that the War (that is,
the great bulk of expense of the War; will
be over in a year or so and when that oc-
ours, there aOW eOme gold standard; and
then, when others are lamenting over the
fall Of stocks the holder of Government
loans will have no fall tOlament. He will,
in fact, profit by that change which injuries
the holders of other property.
"A CARp.-The Ladies' of the Sol dier
Aid Society are very happy to acknowledge
the receipt of 81, 50, being the proceeds of
an iee-cream festival, that was gotten up
for the benefit of the Aid Society By the
little girls whose names are mentioned be-
low. The Ladies say that the children en-
ioyed the festival as much as the soldiers
viii enjoy the comforts that their thought
full charity has assisted in providing.
Miss Eliza Moncrief,
% Lizzie Moncrief,
g Georgia MOnerief, sf -arT
g Fanny Fleshein,s -a -r
-'E Leah Flesheim,
20 Lara Moses,
" Jelia Moses,
d" Carrie Schafer,
e Mary Pierce. Hid
g Ida Sehwartzenberg, ..-.
-" Gergia Mott,
Alice Keller,
: S. A. S. of Northern Ohio
August s:I62. r r n i
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