The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1867-09-03
COMMERCIAL AND FINANCIAL.
The Money Market.

FiHdHcinl Editor Ledger:-Can you
give me some Information what invest
ment of Government bonds will pay
best for one who has a small sum from
his savings TO invest? 1 formerly put
il in compound interest notes, but thew
are now due, and l wish to reinvest.
observe the 1910 bonds are the lowest
quoted; but what interest do they pay,
and why are they lower than the 9TH
ers? Furthermore, will not the pre-
approach maturity The premium on
some of them is so high that it will
consume more than years interest to
paw it. Now, while all the questions
may be plain to you, they bother me,
and no doubt Smany others who work
for living and are posted in
FINANCE.
Philadelphia, Aug. %, 1867.
All the Government bonds are ac
knowledged by the Government as pay
able, principal and interest, in gold.
Being all backed by the faith OF the ma
ton they are supposed to be equally
good. Such being the case those that
sell ut the lowest price are the cheap
est, except the 1910 bonds, which bear
but per cent. All the $40 bonds bear
per cent. interest, as do also the long
Is of 1881. The $40 bonds being re-
deenable within i've years from the
date OF issue, at the option of the Gov
eminent, have on that account ruled
lower than the loans running longer
and to a fixed date, as do the isis.
The 5 2Os OF 1852, 1861, '66 and '67 the
Government may pay OH at any Time
after five years from their respective
dates of issue. There is little proba-
bility now that this will be DONE but
the possibility that it may be keeps
them all the time lower in price than
the long loans. The rule is, all things
being equal, that the premium Will les.
son as the bonds approach maturity. II
the premiumi is eight dollars on a hun
dred, that requires just e per cent. per
annum to pay 1t back mt maturity
consequently the premium should les
sen Just that amount annually. Ihat
is, il the bonds sell now at los, they
should next year sell at 1917, the yea
following at l07, and SO on yearly u
per cent. less until maturity,
when they would be worth only
par. This q per cent. annually les
sens Just so much the gold in
terest, reducing the per cent. paid to
5IS. The longer the loan runs therefore
on given premium the less II takes
If the bond did not mature for thirty
two years the per cent. premium
would be but = per cent. per annum
from the interest, leaving the annual
interest So per cent. instead of5}S. The
interest in gold is worth more or less in
currency as the premium may be high
er or lower. AS the semi-annual inter-
est period is not the same on all the
bonds, and the interest being included
in the price, the amount of interest due
should always be held in view. For
instance, the bonds ofMay and Novem-
Der have two months more of interest
on them than the bonds of January and
July, and if gold sells at ls21I, the two
months interest are worth just that
much more in the market in currency.
After the payment of interest on the
LIST of November, the January and July
bonds will have four months interest
on them, and are worth two eighty five
more than the bonds of May and No
vember. These causes show tiuctua-
lions in prices, as does the fact that
some OF the bonds have European
market Just at the present moment
the $50 bonds of 1854, bearing interest
from the LIST of May, are a fraction
cheaper than any of the other 6 per
cent bonds.-PhiLot. Ledger.