The Placer herald. [volume] (Auburn, Placer County, Calif.) 1855-1991, 1864-08-06
The Central Pacific Railroad COMPANY
Finances.

81 miles OF their road, together with the
bonds provided by Congressional and Legis.
Iative enactments," they will be in possession,
independent Of their assets, Of "ovsr mill
lion of dollars in gold coin" This is cer-
tainy encouraging to every friend Of the
enterprise, but as the newspaper statements
in reference to the Central Pacific Railroad
Company and particularly those made by
the Sacramento Union, have not always been
found reliable, it is well to look into this
declaration to see how much truth it con-
ssins.
Under the United States law, the compa,
ny are entitled, when they have completed
and equipped first class road-for twenty
miles out of Sacramento, the sum Of $l6,
900 mile for seven miles, and $4,000 for
thirteen miles We will not raise the ques-
ton as TO whether or not the company have
completed and equipped, within the require
ments of the law, first class ralroad-a it
is neither ballasted or fenced, nor have the
company erected machine shops, etc, as pro
vided should be the case. and as is necessary
for first class military road
Taking the question pure and simple, as
financial one, let US see how much in gold
coin the company will realize in government
bonds on the first twenty miles. AS set
forth above, they would receive on the first
twenty miles, all told from the government
$4,000 in currency bonds law not
contemplating nor providing for gold bonds
The United States gold 6 per cent bonds,
are now worth in greenbachs, in New York,
par. 1t cannot for moment be supposed
that the currency bonds of government will
bring par. On the contrary, if the govern
ment gold bonds, as is now the case, only
bring par in greenbacks the currency bonds
would probably bring fifty cents in green
backs although it is doubtful if they would
bring as much Estimating them however,
at fifty cents, the total amount which the
company would receive from the $4,000
in bonds, would be 1858, 900 in greenbacks.
As gold is now say $50 this would nett in
gold about STAT ,O00-or say in round num-
bers $4,000 in gold.
Under the law, the company are author
ICED to issue an equal amount Of first mort
gage bonds, which have priority of lien over
the government bonds. This would allow
the company to issue $4,000 more, per
cent gold bonds-but as the company can
issue $4,000 a mile on first mortgage on
road AS fast as it is built, without reference
TO the section of twenty miles, this would
give them for eleven miles s52s,ooO more
of bonds-ma king total amount on first 3
miles of s 1854 600 first mortg bonds
AS the company has already issued under An
existing mortgage 100000 per mile for fifty
miles, it must be evident that little or moth
ing can be realized from this source. But
allowing that the bonds are counted as per
mile issue tie company could issue on first
81 miles 100000 only--deducting this sum
| from The 81 264,0 which the government
law authorized. it would leave 1884 900 first
mort gage bonds which The company can still
issue on the first 81 miles These bonds are
: per cent gold bonds, and would probably
bring in New York 1875 to 100 currency, if
they could be Sold California State bonds
only bring about the same rates Estima-
ting that these 1884 900 would bring 1870,
| the company would receive in greenbdckS
| about S425,OOO With gold at $50 this
would nett The company in gold coin abou:
$4,000 Adding this sum to the $3.50,
900 of gold realized from government bonds,
and the grand total reaches the sum of $780,
900 gold coin. We will say nothing about
the difficulty Of negotiating first mortgage
railroad bonds for SO large an amount per
mile. So far as the State of California
guarantee is concerned it is simply guar
antee from year to year, as the State Legis-
Ia,ure may see fit to levy the tax Of interest
on S | 100000 of the first mortgage bonds
of the company, and is of little or value,
as the first mortgage of 81 100000 is al
ready issued and sold. Even if it applied to
An issue Of bonds subsequent to the first ST..
500,0 900 already issued, the limitation of
government aid sill limits the issue of frs,
mortgage bonds to per mile issue as the
road progresses. and hence the benefit to be
derived from this source is calculated above
Now grant that the company realize the
s4OO, 900 San Francisco bonds &c per cent?
they would bring in gold, probably 5000.
900 or $3.50, OO0--makng total even with
the San Francisco bonds of $4,000 gold
coin. Between this and the "over a million
dollars in coin" of the Sacramento Union,
there is wide discrepancy. As the Union,
however, in its estimate does not take into
the account at all the S400, 900 of San Fran-
cisco bonds, we will also throw out the
amount to be realized from this source, and
it leaves the sum of $500 900 gold coin
which may probably be realized instead of
the cover mil lion" Of the Union Suppose
the Union gives us another financial state,
ment for inspection. Only let il give us
facts and we will not raise any questions