Edgefield advertiser. [volume] (Edgefield, S.C.) 1836-current, 1873-10-30

of safety-securities which will no
only pay a premium upon the none,
invested, but which may be disposed
! of, without loss, Whenever chang,
Of investment is desired-in otbe
words a marketable security. Th'
value, Of a State. security depend
largely upon, the confidence to .th'
purchaser in the good faith Of tn,
State, but more especially upon thu
means. which the State places in tht
hands of every holder Of her bonds
to compel the punctual payment o
the interest as it accrues, and the
principal at maturity. The State il
sovereign and cannot be sued but
when she enters into contract with
an individual through her agents and
directs said agents to perform certain
duties in fulfilment Of that contract
such individual can compel the agents
of the State to execute the will Of
the State as expressed in such con-
tract. Thus, in three-fourths of the
States, whenever the financial officers
are authorized to create debts by the
issue Of State obligations, the ma
chinery for the punctual payment of
the interest and principals provided
as a part of the contract; and every
individual who accepts such obliga-
tion, in exchange for the money he
advances, receivesa remed edy-ofwhich
the obligations themselves are the
evidence-for every neglect of duty
in the premises on the part of the
agents of the State. Such an obliga-
ton offers the best Investment that
could possibly be made, inasmuch as
the holder thereof has lien upon
the entire property of the citizens of
the State. How is it with the bond
ed debt of this State I? Our debt may
be divided into three classes. The
first class includes all those bonds
Originally issued) Of the FIVE classes
enumerated in the decision of the
Supreme Court upon the Morton,
Bliss & Co. mamdanaus case, amount
ing to So, $4,000. The second class
includes all those bonds and stocks
whose only guarantee for the payment
of principal and interest is the good
faith of the State. This class, COM
prises the old bonds and stocks, lex
cept the Blue Ridge bonds,) the bonds
for funding past due interest and
principal, and funding bills Bank of
the State, and amounts to $4,5l3,503
IS. The third class are those for
which no proasaon has been made for
the payment Of interest or principal
by guarantee on otheraoise, and includes
the Blue Ridge bonds, (the absence
of the guarantee in this instance be-
ing probably au overslght) and the
conversion bonds issued directly by
sale or hypothecation. This class ag-
gregates $6,955,ooo. This concludes
the history Of the character of our
bonds. Let us now inquire their
present market value. Our I" Janua-
ry and July bonds" old and new,
which comprise the entire amount,
except S2,,189,oOo of "Aprilsi and
are quoted at fifteen cents.
The latter, beng a portion Of those
recently before the courts, are quoted
at twenty-three cents. Now5it is ev-
ident, from the arguments previously
that the State is unable to
pay the interest upon the debt as it
and that it is to the interest
Of every bondholder that
THE DEBT BE REDUCED
in volume to a reasonable limit, so
that the payment Of interest may be
resumed. If, when the holders Of
our bonds and stocks agree to surren-
ler them for new and consolidated
bond or stock, the State agrees as
part of the contract, (of which such
bond or stock itself would be the ev
idence,) to provide for the payment
Of. the annually accruing interest and
for the, extinguishmcnt annually of
a portion Of the principal until the
whole shall be thus redeemed if, in
pursuance of such agreement, she in
aructs her agents (whoever may rep
resent her from the date of the con-
tract until the debt is entirely extin-
to levy and collect annually
taxes sufficient to pay said interest
and retire portion of the said prin-
she instructs her agents as
aforesaid to disburse the funds so
collected to the purposes aforesaid,
and If embezzlement or diversion Of
said funds be made o felony, punish
able as the constitution directs, it is
evident that it would be to the best
interest of the bondholder to accept
willingly such a compromise: For
if these remedies be placed in the
hands of every bondholder it is evil
dent that while bis new bond would
represent apm its face sum equal
onlv to two-thirds or one-half the
face valne Of his old bond, the mar
ket vsluc of the nav bond would
undoubtedly be from one-third to
one-half greater than the present
value of the old. For instance, if
$4,000 of old bonds, worth Is cents
on the dollar, or $3.50, be exchanged
for $4,000 in new bonds, worth at
least 40 cents on the dollar, or $500,
the holder will have made aclear gain
upon the actual value, Of his bond of
$3.50; and again, if $4,000 in. old
bonds, worth % cents on the dollar,
or $500, be exchanged or..$2,ooo in
new bonds, worth at least 40 cents on
the dollar, or $500, the holder will
have made a clear gain upon the ac-
tual value of his bond ofI$ll0 and
in addition thereto, the. payment of
the interest and redemption of the
principal of his new bond 81 will be
r.ply secured by remedies in, his
Immediate possession. - : = r
RECOMMEND: l'.i.1l'3 =
First. That all the bonds of. the