The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1873-01-20
Testimony of Bankers on the Evils
of the Syndicate.
1f. Duncan and Mr.. Patterson Before the Ways
and Means Committee.
Tho Dangers Of Great Disturbances and varia-
tons Of the Gold and Money Market-Mr.
Boutwell's Explanations Of the
Syndicate Transactions

patterson, OF Phladelphla, responded 10 the in"."
ton OF the Committee OF Ways and Means asking
them, as bankers not connected Win the Syndi-
cate to give their views in relation to the funding
Or the balance OF the $500, 900, 00O loan.
Mr. Duncan having made his statement ad-
yerseIy to the proposed syndicate arrangement,
the chairman addressing MI. Patterson) said =
Mr. Patterson assuming that you the char.
bonds have been negotiated we would like 10 in
CURE you what your view OF it Is and whether yon
snce d the Ave sentsi We would like ipIormatlon
law as 70 the moae sdoped by the Secretary Of the
Treasuryol do not make this inquiry with
but in to the future, second whether can
opinion advisable 10 proceed all rst
The Secretary OF the treasury under the existing iawi
Of unied States Loans by The method referred to is eH
posed obectiops, Mr. duncan has Just said. Il
invSstorss han had previously held them and this BY
ment, with gain OF 10 The subscribers or put
chasers such Inducements would naturally be offered
or the PUBLIC and these would be taken not 80
-A'- - DIsTaisuT,os TO sxALLsa INVESTORS
and with view 70 profit that way i understand the
the market to have THAT the secretary rst
ne Sq or % & a@q IN bS
Ssy 70 10
per cent commission. Al that the existing ye
q these new ponds although having longer ame to
run, not very rapid. There was little or nothing
would have sed the
as m he ns Of
agencies was recalled and arransement made with
had he opon to Sn sell s'' sf' Inc nA0
the would not be called payment until the
S nps The delivery
M rs sI that The synd
gate subscribe $4,000 600 in the month sePtem
Tha, much o. l. was not optional Then as to the holding
other government bonds substituted Tor them
Mr.. PArrERscS-rhe government acted very wisely and
Th commendabie caution IN retaining The bonds gnai
bonds for hen but the application wish to make Of
'-''' 'A'' r Terms rms MADE WITH THE SYNDICATE
were more advantageous than those offered to the first
quarter per cent s gold and we heps ana ne
would have attended the rst pn0Gt
6scanss the offered the yndicats dnereni
bonn Ay Not
biates bonds better that the as
tends 10 and dase the oan snd attracts
more general atts nIon 10 II may say here that think
success Of the syndisaie negonation and hat IL was
% aea Ainfn
by giving the rsss three nose 70
see and ns 81 Sale 81 M
The H passing 70 the other questions
proved Of the rst method adopted by the secretary 70
neg9uae these bonds through agents OF the government
A QUARTER or ONE PER cENrf
Mr.. PArrKRsos-I did not intend TO say do know
that IL would have been success would not APP
The uniiRsAs~suppose that you had practical proof
s SSuS wd nssG a in h1 WAY MORE hsn f
subsequently adopted
to the conclusion that the market was not at that time
aeonditon 70 take the remaining bonds on The terms
N IA wal nn
until the market came to the required condition the
The CHAIRMAN-If you have said all that you desire to
say on the first point. would ike TO Inquire from you
committee to recommend, assuming that 1t Is wise to ne
Mr.. PArrERson-Beore you proposed this que stion,
was shout adding mat large moneyed transactions the
hcaliy related to the government, with great powers
capital however respecabe or eminent SUCH pares
may be, are liable 70 TINS, win s.,.... '''
They have powerful and predominant motive con-
!on success and thereby h pTSmSe ne Interests
exchange and the movements Of capital, they may be
ssn's q srea. disturbances and Variations ct Of
the business q the Country do mot sa
sSen ny the oud SO reh
Think nevertheless subject to that risk aud
such large money credit may produce con.
mr. KrRa1i Would ike to ask You IN that connecon
Wheeler you think mat the the negcson OF The loan
haze financial stringency that prevailed here
as
parties who held the old bonds not renves in the the
AYES they would sell or collect the caledin bonds aud
would be applied sale 10 S' pnrs6ns ens
GID Sss do not see any necessity m me exchange
operation is controlled by judieious and intelligent
The CnAiRxAS-Assumng it to be the purpose Of the
goysrnment TO nesotiae this loan Oh the best possible
public what alterations IN the existing laws would GU
ar. PArrKRsoN-I do not know that am thoroughly
informed In regard 10 the requirements OF The existing
The cnAIRxANAssuming that the Syndicate operations
we're conssten mt win the existing law, wha, aera
Mr.. PATTERsos-l would make the law define more
fully the power gives lit be in conformity with The
ssns sw then bi he law law Is not very In regard
same authority S which WI give ninety days n which to
". RnnnW hers ,hsre Is No Tint iatlon in The lawi
Mr.. PArTKRsoE-Where there Is NO hini taton OF the
The caIIasAs-What legislation would YOU recon.
Mr. PAnrnsor-That !. q very large subject
The CHArRnAS-0ur needs are large.
PA e. che credit OF the
The cHArnxAy-rakins ali things into consideration
flrIsHsos- would og. express very aish estimate
o. ne srs wah i ION 10 hay
and future resources under development d che
Increasing wealth Of the country We nave exhibited
% the world resources and have paid taxes eI,or.
in amount with alncrty that has
attracted the attention OF the civilized world and has
sped confidence in think that we have scarcely
given our credit the position IL should have commanded
for Tie that we have provided Tor maturity OF
our bonds discretion 1T carly date by tho option
We retained TO pay them OIL This is form OF bond
eesVe, unknown Europe except as presented in our
oohoS They accustomed To aud prefer long bonds
ma maj quality OF long time permits lower rate OF in
a. s mns was necessity that we should borrow
~ ngn rate Of ineres. during the war the option to pay
i,S II s vS 70 be valuable one anu we should not rar
90 not see the advantage OF aLy
fhEcifltArE LEGISLATION
IN regard would recommend that legislation be
nPpneo ~ NvDsoHuaJe The various bouds-viz., teno
u.s n,e,,twennes, &c-by issuing bonds with UNIFORM
.nn VI tn.lss' anu ne at long tme-fcrty fifty
yehstia low rae OF interest The longer the time the
lower would be the rate Of interest 81 II Consistent
win ,ur eoty OF our government would issue inter
Innaee annnties, which does necessarily mean in
NtcniinaOie debt Tor the government Could v fhan az
amy time la the open MARKET and with sucg $500 ~
uon by the government OF It's estimate Of its cran,
capital would grayitate To these bonds In sell