The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1869-07-28
TO SPECIE PAYMENTS.
From, the N. y. Tribune.

From the NJ Y. Tribune.
We have intimations from Washington of
offers from German bankers to negotiate
heavy loans for us at five per cent; assurances
of the Secretarys confidence that within
year we can borrow all the money we want at
four and a half or even at four per cent; pro-
misses that the next debt statement will show
a still further reduction below the last. Such
signs may well be taken as of good omen for
the policy of the Treasury Department,
whereat Wall street has so often protested,
but whereby the Government is thus seen to
profit But, after all, what stronger proof of
the wisdom of the course ecsntly pursued
by Secretary Boutwell, could be furnished
than that given by the present condition of
the market for Government securities and
by the price of gold? Bonds have been
steadily advancing and gold declining
while in Europe we have a quotation
Of S3d for Tive-twenties, equal to 913 in spe-
Gle at 10 per cent exchange. Not only has
this result been attained, but a movemant in
the current of valuations has commenced,
which bids fair to bring bonds and gold to an
equality, and that within short space of time
if the Secretary has the courage to persevere
in the policy now working so admirably.
With the present accumulation of gold and
currency, and with the excess sure to be in
creased by an economical administration of
government, the Secretary will find it an easy
matter to buy from ten to twelve millions of
dollars per month without causing the slight
est arrangement in the business affairs of the
country, until bonds advance not only to the
currency valuation of gold, but until they
range far above it.
The effect of purchases thus far has been
decided, but neutralizing influence no doubt
comes from the prevalent belief that the
present policy is but temporary, and that,
| when the Secretary ceases to be larger
buyer, prices will decline. Under this i'm
! preston, speculation runs against the bonds,
and large holders are tempted to part with
! them, in the expectation of being able to re-
! place at lower prices. At the same time
bankers speculate for the fall, and thus create
a large short interest, which gives the appear
ance of a supply much greater than would ma
| turally come upon the market. A banker, for
example, having concluded that within a week
or two the Secretary must change the
present policy and greatly reduce his
purchases, finds no difficulty in borrow
ing bonds of large holders by furnishing
money for them during the time
they are borrowed, and then sells to the Secre-
tary, feeling confident that when the large
purchases cease he can buy in at profit and
return them. This has already been done to
a large extent. Besides, we have reason to
believe that many of the bids made are either
Tor the purpose of advertising the bidders or
TO create the impression that large amount
OF bonds is pressing for sale. In some
instances these bogus bids" happening, to
the surprise of the bidders, to be accepted,
they have been obliged to resort to some of
the large banking houses to make the de-
nVenes Tor them. In this way an influence
against the bonds has been felt, which will
disappear whenever it is discovered that the
Secretary policy of constantly reducing the
public debt with the surplus revenues of the
Government is permanent and not tenn
J porary one.