Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1875-10-21

reason that these bonds will have long time to
RIM and that the interest is payable quarterly that
,hey will be much sought after for permanent in
rcsiment and become a favoritc security. The
conversion of fve-wenties into this loan Will save
the Government annually in interest $5oo0,Ooo,
and during the past five years, while the conversion
has been progressing, the actual SAVING TO me
Government has been about twelve million doI
lars.
VALUE ovLcSGSfIME PoNDs.
To carry into effect tho Specie Resumption act
passed by Congress last Winter, the Secretary Oh
the Treasury is authorized by the third section OF
that act to issue any bonds OF the description ana
character Of those authorized by tne heiunoIns
of $50 Under this authority limited amount OF
five per cent. bonds have been lssueo ue oan.
apy further issue Of bonds bearing i've per cent
interest will be made under the Specie Resump-
ton act must, of course, depend upon cncnm-
stsnces. The provisions OF the act unoer consie-
Grafton are mandatory. The first section author
yes and requires the Secretary OF the Treasury,
"ss rap;dlvas practicabie to TO be coined at
the minis Of the United States silver coins and to
issue them." &C.; and the third section author
ICES him to sell bonds at par in gold bearing five,
four and one-ha or four per cent. interest, as he
NAV elect While placing loan bearing five per
cent the Secretary could not of course, dispose OF
bonds bearing lever rate Of interest, under the
Specie RESUMPTION act. He is bound to obey the
requirements of that act and therefore was
obliged to issue bonds bearing the same rate OF
interest-ive per cent,-as those now being is
sued. When the remaining 5000, 600 OF the
five per cent. loan has been subscribed ana the
Secretary in the conversion of fiye-twenties, Is
confined to issuing bonds bearing four ana one
half per cent it is probobe that any bonds that
may be issued under the Specie Resumption &C.
will be four and one-half per cent. In the issue
of bonds under this act it should not be forgotten
that those issued. or which may be hereafter Is
sued, at the rate of five per cent, become redeem
able 1t the option of the Government, after May
/. 1881, while bonds that may be issued under the
came act bearing four and one-half per cent. in
terest will not be redeemable until after fifteen
years from the date Of issue. Persons desiring to
invest in bonds having long time to run will bet
ter understand this advantage when attention IS
directed to the fact that five per cent bonds issued
from this time forward may be redeemed at the
pleasure of the Government aftet May l. 1881
whereas the four and one-half per cent. bonds
will have fifteen wears from date of ISSUE or near
" three times longer than the five per cents.
Those not familiar with Wall street operations,
and prices of stocks and bonds will appreciate
the relative value of short and long time bonds by
referring to the commercial columns of the Times
and examining the prices of United States and
Pacific Railroad bonds 1t win be found that the
Pacific Railroad bonds, which the United States
have guaranteed to pay, principal and interest, IN
lawful money, and which are known in the mar
ket as Currency Sizes" are quoted as high as
the SKIES of 1884, which the highest in price OF
all Government bonds, and yet the SKIES OF 1881
pay six per cent. in gold, while the currency skies
pay six per cent. in currency. This appreciation
Of currency SKIES is explained by the fact that
they are not payable until 1904.
Il should not, however. be supposed that be-
cause the Government has the privilege OF calling
the five per cent. bonds for conversion or redemf-
ton after May, 1881, that such call will be made,
1ndeed such case is almost beyond the range OF
possibility. There are now outstanding six per
cent. bonds 10 the amount Of 81 070 649 100 all OF
which will be converted or redeemed before the
fives of 1881 will be considered for redemption.
No time is positively named when these bonds
shall be paid and for the reasons heretofore stated
it Is fair to presume they will run long time. and
for all purposes may be regarded as longtime
bonds.
ADVANTAGES OF GOVERNMENT BONDS.
The advantages Of United States bonds over all
other bonds may be briefly stated: First, the