The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1867-02-07

rates which American securities command
in England. The new Russian loan, it sp.
pears, sells at eighty-fve, at which rate the
purchaser obtains an interest of less than
six per cent. The price of American five.
twenty n Is seventy-two, which makes
the Interest just eight-and. a.third per cent.
How comes it, says the Times, that the
securities OF the United States are thus by
comparison, discredited. We believe one
explanation of the difficulty is to be found
in the fact that the market was Hooded
with American securities IN an incredibly
short space of time. Five-twenttes to the
extent of hundreds Of millions were issued
within a few months. This, however,
ought not TO explain the difficulty If the
mobility o capital were as great as politi-
| cal economists represent it to be In theory.
Two forms Of investment OF equal secu-
rity, but offering unequal rates Of
interest, being in the market, the
investor ought to sell ont Of one
and buy in the other, until their prices
Appropriated so that the rate Of interest
would be about the same. Practically, this
does not happen. The w~ell-known phrase
permanent investors" points TO the cha
racteristic of the ordinary holder to abide
By the security he has chosen. Hence it
follows that investments in American Sc
curities must to a great extent be made out
of savings, and it may be expected that
prices will rise as the savings invested &C.
cumulate. But it would be affectation to
pretend that this explains all the apparent
difference in the credit of the American
and Russian Governments. 1t must be
II a1-N~r,l,l,.al t1oS tLn-a ,rauaslu n nn.tos,
distrust of the fidelity of the American
nation in keeping its engagements, and it
is well that Americans themselves should
know the reasons which excuse, If they
do not justify, this distrust, in order that
they may do all in their power to remove
them. Investors are an initiative, a gre
garious body they flock together, and
inspire each other with confidence at
one season and with suspicion at
another. If one has been bitten, all
take the alarm. We are not sure
that the old acts of Republication do not
even 0 deter capitalists from trusting
the American nation. Americans may say
with perfect truth that these dishonest
tricks were for the most part committed in
the South but we are here only referring
to a fact which may or may not be wholly
unanswerable. There is, however, a more
recent and UNSUITABLE occasion of .suspi-
cion. EngliShmen had almost learned be-
fore the late war to forget the bonds of
Alabama and Mississippi, and had again
invested largely in State securities. The
war came, and interest soon ceased to be
paid in the South in consequence Of a force
majeure of which no creditor could COM
plain. But the bondholders of the north
ern States found that they did not escape
unscathed. Congress passed an act autho-
rizing the issue of inconyertible paper, and
declared it to be a legal tender.
Every State in the North, with the
honorable exception of Massachusetts,
faithful it among the faithless found
availed itself promptly of this law, and
paid its creditors in a deprecated cur
rency. Thus the English creditor who had
lent $1,000 in gold to the State Of New
York upon the promise of six per cent. in
terest-that is, of an annual payment OF
sixty dollars-receiyed sixty dollars in
paper, the value of which was at one time
no more than twenty-four dollars in gold,
and even now is very little more than forty
dollars. Worse than this, if the bond be-
came due, he was paid off with a sum
varying from two-fifths to two-thirds of
what he had lent. Instead of getting back
his thousand gold dollars, he received from
four to six hundred. 1t is true that a
protest was raised in Americaitself. The eX-
ample of Massachusetts, was and is a stand
ngrebuke, and we believe an offer was made
to the State of New York by some leading
merchants and bankers of New York city
TO lend whatever sum might be necessary
to make up the difference between coin
and paper, upon receiving a promise of re-
payment on the termination of the war.
Had it been a question of personal honor,
it could in that case have been found ne
cessary but the morality of a Legislature
is determined by its worst members. The
offer was declined, and every creditor OF
New York, of Pennsylvania, of Illinois, of
Ohio, and the rest was mulcted of his just
claims. If the total sum thus kept back
from English creditors were made up, 1t
would make a formidable item in any in
terpational settlement.