The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-12-24
FINANCIAL AND cOMMERC GAL.
WEDNESDAY, Dec. 23-e P. M.

WEDNESDAY, Dec. 23-o p M.
The injustice OF the law which prevents The tax
alton OF government bonds either for Internal reve
nue. or local purposes Is well Illustrated In certain
transactions which are at this period quite large
portion OF the business OF Wall street. Reference Is
had to the extensive purchases OF United States
bonds by the national banks, by private corpora
tions and by wealthy capitalists, who by holding
them on the 3lst OF December and the lst OF Janu-
airy next, will avoid the payment Of large amount
OF taxation which would be imposed were their
funds otherwise invested. To-day the market for
government bonds became weak on account OF the
stringency In money, and the declined prices
tempted large purchases principally by the
class OF investors referred to above. Under this
demand the market grew better and became
prm at the close. As everybody knows VINO has
aver earned thousand dollars year, 1t IS neces-
sary on the 1st OF May, annually, to make sworn
statement to the United States Internal Revenue
Assessor on the subject Of income In order that the
tax may be imposed The State, county and city
are also empowered by State and local laws to I'M
pose still another tax on personal property and
capital All these, however, may be avoided Dy
turning property and capital into government bonds.
THAT the national banks should take advantage OF
this chance sinking the burden OF State and local
taxation Is one OF the most unjust features OF the
law. These institutions not content with making
the fifteen and twenty per cent which the folly OF the
National Bank act enables the stockholders to earn
upon their investments too greedy TO stand their
share OF the expense OF the local improvements and
local government in the midst OF which they carry
on their business, Just their officers are down
In Wall street buying up bonds. BY putting the m
In the place OF capital they will avoid the State and
City Assessor Private capitalists and private mo-
neyed institutions included in this demand for
bonds. The atroclous feature Of their transactions
Is that they generally buying the bonds on timer
for the most part thirty days-and keeping their
money otherwise employed meantime. This will
enable them to make the necessary affidavit that on
the 31st inst. the LIST prox., as the case may
be, their wealth consisted in the untaXable
government bonds. Considering that these
securities were purchased all the way up
from forty-nve cents on the dollar (when gold was
2oO), ana have since drawn gold interest at six
per cent for their face, their immunity from taxa
tion seems all the more outrageous. The wealthy
can avoid the burdens OF government by simply In
vestng In them at tho Opp0rtune moment. The
moral dishonesty OF so doing might also enter into
the consideration Of the subject; but IN these days
OF legal conscences, instead Of the old-fashioned
human affair, 1t would be proftess to pursue
such q topic Tao burden on the middle classes and
the'poor. who have no bonds and cannot invest in
them. Is made all the heavier by this unequal dis
tribntion. II Congress will drop the chimera OF a
forced resumption OF specie payments and
turn Its attention to the prOpriety Of
resembling Q measure which makes the rich
richer and the poor poorer it win help redeem its
record OF folly and mfsmanagement. Otherwise
with the increase OF the burden OF taxation the
masses may be reused to o sense OF the injustice
which Is done them, and finally demand the repuda-
sion Of this Indebtedness altogether.
The market was without animation after the
boards and the following were the prices at half
past four oclock:-united States sixes 1884, regis
Jered, 1885, 1O9 do, coupon, lax a l14K;
6-20's, registered los 1861; do coupon, 1852, ITO
11oH; do, 1864, 1904 l06k d0 1885, 1o7 10714;
do, new. 1856, lo9A no. do 1867, 1O0N ITO; do,
1868. l10A l1o1s; lo-4o's, registered, 100 1o2h
DO, coupon. los 1856 currency bonds, 90 a 9oA.
The money market was active to strngency In the
nrst half Of the business hours Of the day. The
tivlty at the close on Tuesday induced lenders to
Keep back their funds this morning for higher rates.
and the consequence was very severe pinch, par
ticulary among the needler and weaker classes OF
borrowers who paid the full legal rate In gold, with
commissions ranging from 0nesixteenth to one
quarter of yer cent. The groos volume OF bust
pess was done at seven per cent In coin until the
half hour before three O'CLOCK when the "snylocks"
who had rot "placed'' their money became anxious,
Ind were freely offering, the rate declining to
sevsn per cent currency. There is money enough
in the city to satisfy the demand, and all
Aucceeded In getting what they wanted, but
OF extreme rates. There Is o tendency on
the part OF great many merchants and others to
decline engagements until after the holidays, and
their withdrawal would create an easing OF rates,
were not for the contraction Of loans by the banks
Ia preparation for the quarterly statement. The
great amount OF money invested in stocks through
the renewed speculative feeling engendered by the
rise in New York Central is also Q cause OF strn.
gency. The higa OF interest prevailing in the
metropolis are attracting money from other fnan-
cial centres, about half milion coming in to-day
trom Boston, AMI some relief might be expected
nom these sources were not their inability made
manifest during the great money strngency pro-
duced by the Erie clique, when the Golfers OF nearly
Al the country banks were emptied into New York
without avail. The West needs no more money, and
3 large proportion OF the Southern cotton crop has
been already moved so that easier money market
y expected after the passage OF quarter day with
jthe banks and the advent Of the new year.
Gold was very dull and weak to-day, one interval
OF an hour and half eiapslng without change In
quotation. 1t opened at 135, declined to 134X,
rallied to 1856 and settled to 134 at the adjournment
OF the board Between three and four O'Clock 1t de-
clined to 134S, but grew nrmer toward 1--WE o'clock
when 1t closed at the quotation ls4x 1s4H. Its
weakness is due to the better feeling In the Euro
pean money market and the recovery there OF
United States securities, founded upon the less war
like aspect OF the Eastern complications. There
an abundance OF ca3n gold for delivery, but purchas
crs preferred Keeping the currency, and paid high
IS and per cent ordinarily, and per
cent, 1-16 and 3-6i exceptionally to have the
metal carried. the gross cearlngs were $780, 0soo 0o
the gold balances sl637,I3i and the currency
balances 81, ,dJ93S. The European steamer took
out no specie. The consignment from san Fran
cisco by yesterdays steamer was over 100000.
1 Ia the stock market New York Central continued
the feature but the volume ofbusiness In IL steadily
declined until az the last board the call pass ed
without o sale. TIE weak hands holding 1t became
alarmed at the safety OF their investment, partcu.
larry they were compelled to pay such heavy in
terest for carrying and threw 1t the market. The
opening price Oh tie street was from half to one