The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1870-06-11
SOME FACTS WHICH BEAR ON THE
FUNDING QUESTION.

From the NJ y. World.
The new Funding bill reported few days
since by Mr.. Schenck and awaiting discus
sion by Congress, meets with no favor from
the press of either party. Besides obi ections
to several of it's details the expectation that
our government can borrow money at four
per cent. is secuted as ridiculous. Our six
per cent. bonds are selling in London at about
80; that is to say, purchasers are willing to
invest in our securities if they can get G$ per
cent. interest for their money, but not at
lower rate. In the present state of our credit,
four per cent bond should sell at 59i. But
the Funding bill authorities the Secretary of
the Treasury to issue four per cent. bonds to
the extent of a thousand millions, and for
bids him to sell any of them below par. This
is tantamount to forbidding him to sell the
new bonds at all; for bonds cannot be sold
without buyers and capitalists who refuse to
purchase six per cent. bonds at par will not
take four per cent. bonds at par.
Even Secretary Boutwell,, who is under q
pleasant hallucination respecting our ma
tional credit, does not believe he can dispose
of four per cent. bonds. He is reported to
have said that he will not make any attempt
to place new loan at that rate The Senate
Funding bill, which was under consideration
at an earlier stage OF the session, proposed
three new loans, at three different rates, the
lowest being four per cent; but nobody ex-
pected the four per cent. bonds would be
taken except by the national banks, and by
them only on compulsion to save their circu-
lation. The idea that such bonds eau find
voluntary buyers at par is supremely prepos-
ferrous.
There is a prevailing delusion respecting
the improvement of our national credit within
the last year or two, delusion which has
gwen birth to all the wild expectations of
fnn1ipc fba rNnblin dahf at l.,
rate of interest 1t is true that the fve-
twenties have appreciated in the market, but
the rise is ascribed to causes which have had
little or no influence in producing it, Mr.
Boutwell, has plumed himself on the apprecia-
tion, as if it were due to his administration
of the finances, and especially to his monthly
purchases of the public debt. But he would
deserve no credit if this were the real cause.
The enormous taxes under which the people
groan have yielded a revenue which the ex-
travagance of the Government has not wholly
spent, and no other use could have been made
of the surplus than its application to the
public debt. The improvement in the price
of our bonds is not owing to that cause at ALL
nor to any cause connected with the manage
ment OF the Treasury. On such a subject, few
authentic facts are more convincing than auy
amount of mere reasoning The truth is,
that nearly all foreign securities have appre-
ciated in the London stock market, and in
quite number the advance has been greater
than in ours. If Mr.. Boutwell, be such a
prodigy of financial ability as his parasites
proclaim him, and his wonder working policy
is so admirable, our credit ought to have
mounted to a sublimer height than that of
Turkey, Spain, Brazil, and the Argentine Re-
public; whereas, in point of fact, their securi-
ties have advanced as steadily and more
rapidly than ours. Within the last year or
two, there has grown up strong tendency to
invest in foreign securities, and every gov
ernment in tolerable credit has felt the ad-
vantage of it. The following table from the
last number of the London Economist, though
used by that journal for a different purpose,
shows that our financial ship has been borne
up on rising tide which has also lifted the
securities of many other nations:-