The Superior times. [volume] (Superior, Wis.) 1870-1912, 1874-07-25


currency. Various other forms of
swlndllng have been developed, but
for the most part the non-interest-
paying railroads have resorted to no
tricks, either before or after the de-
fault. Most of them, it is true, were
built on the Credit Mobilier plan,
but that was we'll known to the lend :
ers, or might have been known to
them. Hence they have nobody to
blame but themselves on that score.
The holders of these three hun
dred and odd millions of defaulted
bonds are mainly inhabitants Of the
United States, Germany, and Eng
land, and the ratio of their several
holdings is probably in the order in
which they are here set down. 1t
is commonly supposed that Germa-
ny is the greatest sufferer, but a few
facts will serve to show that this is
not the case. All the Northern Pa
cific bonds were taken in this coun-
try, except mere handful which
were taken in Canada and England.
Nearly all the new railways in Mich
igan were built by New England
capital. Boston and it's suburbs are
carrying from thirty TO fifty millions
of protested bonds. Several East
ern broken-down railways, like the
New Haven, Middletown & Wilt
mantle, the Oswego Midland, the
Canada Southern, and the Chesa-
peake & Ohio, were mainly con-
structed with money obtained in
this country, and a great shoal of
second mortgage bonds were sold at
home after the first mortgages had
been taken in Germany or England.
The effect upon American credit
of this enormous failure to meet OBJ
legations is disastrous. The good
and the bad suffer alike in foreign
markets. Even those securities
which have regularly met their in
terest have suffered heavy decline.
Germany is full of American railway
bonds bought at 50 to 95 cents (gold)
which can be bought back at 25 to
40, with the hearty thanks of the
present holders to anybody who will
take them at those prices. AS for
negotiating new loans there, you
might as well attempt to sell lava
on the summit of Vesuvius. Not
only is the market for railway secu-
rites destroyed, but the ordinary
real estate mortgage, the highest
form of security next to Government
bonds, finds no takers The bottom
has tumbled out of everything ex-
cept Governments. Can anything
be done to re-establish our credit?
Of course, the upbuilding, in any
case, must be slow. The first thing
to be done is to give the bondhold-
ers promptly all the rights stipulat-
ed for in the contracts under which
their money was borrowed. This
is the work of the courts, and there
is every probability that it will be
honestly performed. Where fore
closures are demanded, they should
be granted without unnecessary de-
lay; and where fraud is shown, it
should be exposed and punished to
the fullest extent. If the admins
tration of law in this country is
shown to be prompt and certain, and
if the properties mortgaged are
handed over to the mortgages as
as fast as lawfully demanded, we
shall not only achieve self-respect
and the respect of other peoples,
but we shall also begin to rebuild
our credit abroad, for these default
ing railways are for the most part
worth what the bonds call for, and
will pay a fair rate Of interest in the
course of five years, together with
interest for the time they have been
in default. Some of them are utter
ly hopeless, not worth operating ex-
penses, but there are only few i'll
this category. The great majority
are merely ahead of time, and time
will bring them out. Meanwhile
the bondholders can take what they
bargained tor-that is, the property
which their money has called into
being Chicago Tribune, END.
WHO FOOTS THE CUBAN ARMY
Bills
A Washington dispatch says: GA
gentleman just returned from Cuba,