New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1875-05-23
THE FUNDING OF THE LOUISIANA
STATE BONDS.
No. g LOMBARD STREET
London. MAY G. 1875.

No. g LOMBARD STREET !!
] London, May g. 1875.
| GENTLENEN-I lose no time ia reouesting
You to inform ali your friends, clients, or
| customers, of the steps which seem likely
! TO 0e adopted by the various committees of
| holders of Louisiana State securities ia
London, Manchester, Amsterdam. Brussels,
! Berlin, Basic, etc, III cOnseG dence of the
funding law, which aims at robbing them
OF forty per cent of the entire principal of
| their bonds. 1t will be well if all the hold
ers, bankers and brokers in New Orleans,
New York, Baltimore, etc, do likewise, so
| that in all the markets Of the world there
snail De common action. So many of the
unfortunate land some very poor investors
| IN Louisiana securities are in such none
! tary adversely 10 consequence of the dis
honesty OF the State, that they will be COM
| PEELED by their necessities to accept tempo
rarlly sixty per cent Of their due if the State
says, by the brute force" of this new
funding law they shall have nothing unless
they fund. In consequence Of this cruel
pressure, the committees here in Europe
are immediately going to recommend all
holders who are obliged to fund to do go
only through well known banks or bankers
IN the United States. and then OILY through
the public notaries acting for such bankers
there. Such bankers will be instructed to
schedule or statement. duly certified by she
nOtarles, OF the bonds SO funded for each
person. ihen IL exchange for such legal
lzed statement. eauR person will obtain
from the ccunci. OF foreign bondhclders,
acting for all the committees, certificates of
default. representing the forty per cent Of
which they are at present mulcted.
II would be we'll il the clerks or onicials
OF the Slate would sign OF initial these
schedules as correct, bn, perhaps they will
object to do this
You may depend upon it, these cert
fcates Will have price IL the various
markets, albeit small at present. When
the feeling i'll the State is better and the
legislators see the dishonesty as well as the
impolicy OF this funding act: perhaps they
will takeHteps to settle with the certificate
holders. 1t may hereafter be possible and
profitable Tor people Of influence in the
State and their friends holding the certi-
fcates to inaugurate and carry ont policy
of honesty.
These certificates will have an official
quotation in the markets of Europe and
hope Won will arrange the same thing in
New York and New Orleans. There surely
| can be no harm in doing this, beoause it is "a
very trliilng expense TO give in The bonds
through bankers and their notaries, and
the price OF the certificates will much more
than make up the expense. ] think the
commencing price of these certificates las
soon as issued would be about five to seven
per cent, and that will be something to
poor investor. Use, therefore. all your
iotiuence IN your city TO have similar meas.
ures adopted. At all events, if you have
no local committee, take care only to fund
through bankers and notaries of good
standing, and then if the schedules are
correct and duly certified before the British
or Dutch COnsuls, the councils in London
and Amsterdam will grant you certificates.
The amounts of these certificates will be
regularly published il the New Orleans
papers,and the markets of the world will be
closed to all new State, city or other loans of
Louisiana, until these certificates of default
are honorably settled. No matter how the
official employees or agents of the State may
have mlsspent the money originally re.
celved by the sale Of the bonds. the public
bought the bonds bona tde, and it is clear
that this funding law is monstrous piece
of cool robbery, and 5tlme will prove, of
government stupidity as well. The State
received ninety Tor the eight per cent bonds
and seventy Two for six per cent bonds. the
full prices according to the laws, and am
sure, therefore, that honest citizens OF the
State must now blush to see this ubiquitous
measure passed by their Leg Stature, claim
ing the name of civilized government
which cooiy attempts go soon afterward 10
rob the buyers Of those bonds of forty Ger
cent OF their just rights.
venture to say that if Louisiana had fo,-
lowed the honorable course. it's credit in the
world would have been in time equal to
that OF Massachusetts,, inasmuch az it's
bonds were becoming favorite securities,
and this feeling was constantly spreading.
They were known and held by investors in
mere markets than the bonds of probably
any other State in America, and the State
would soon have beer able to borrow money
IN Europe at five per cent. and to pay off it's
eight per cent, seven per cent aud six per cent
Liabilities, thus efectiDg iecitimutely what
it is now attempting to do by sheer force and
dishonesty.
1t is a marvel that its legislators should
have been 50 ehor,sighted as to perpetrate
an act which has damped this feeling and
cast disgrace upon its former honorable
name, and thas not alone deprecated it's
State credit, but also indirectly the credi. of
all its cities. railroads. banks and other in
situations IN the eyes of its own Deople and
in the face of the whole world. II has kept
much foreign capital from going into the
State.
| ain convinced that the people of Louis
siana, like those of other countries, will
not long allow This stigma to remain upon
its honor. but will take means TO undo, or
at any rate, atone for this false step.
Your obedient servant,
ARTHUR KINDER.