The New Orleans daily Democrat. [volume] (New Orleans, La.) 1877-1880, 1877-11-01
THE FUNDING SYNDICATE.
IN ASSOCIATION PROPOSING TO no
BUSINESS IN sOUTHERN STATE
DEBTS
The work TO begin this Year with an
Attack on the states of Arkansas and
tennessee, and the City Of New Orr

Attack on the states OH AFkansas ab"
tennessee, and the City Of New Orr
leans.
New York Herald Oct. 1871
ripple Of unusual interest was excited yes
terday III Wall street by tho reports Of the %.
prominent banking firms for the funding OF
Southern BONDS. These reports received sub
stantial basis when o request was received rom
John J, MeKnnon, of Messrs. Mckinnon u
Tewkesbufy, financial agents. who male o
statement about as follows: ,..u,aa.
had been paid upon tue Southern, State. county
or municipal Indebtedness. aud aince the panic
e Or no interest haa p stat1 rhaaa n Sa uoho
state, county and municipal interest on
which thus remained unpaid. aggregated $780,
debts exceeded s3oo.oOooo 900. whlo the bonds OF
the States amounted to nearly 5000 900. 900. Now
itwas known said Mr. MeKinnon, that the value
81 d bond depended rather on the Legislation
which authorized Its issue than on the paying
ability or integrity Of the community which is
sued T. In order therefore 70 secure 2, this
ultimately q ths Sc capital Of this indebtedness.
sur sas whose a G ss 81 nc hss
several Southern aud Eastern States would ac-
complish the end in view. Io secure this legis,,
States" hud been formed and would be incor-
porated under the general law Of this state.
The flrms composing the assocatiop9 we're ths
through one Of its lelding directors Mr., Francis
E. French, Hugh McCglogh & Co.. Of Lopd2n
ina ySg hoan qP DreTb sf m9 wg@a Gers
81 equally high standing, whose names Mr.. Nc
kinnon did not care TO mention Just now, Mr..
formerly Of the Fist National Bank, tho secre,
tary OF the association.
HOW PAYMENT Is no DE SECURED
Mr. Mckinnon now detailed his plan for Sc
curing the payment OF the interest on, these
sbooooo.ooo worth of bonds tsoms Of which were
sold at 10 per cent to their present ownersl He
had drafted law which he should submit to
the Governors and Legislatures 81 the several
adopt This law would compel these states
counties and municipalities to comply rigidly
dneement for ils adoption the syndicate, would
offer to find all these bonds bearing eight or
ten per cont interest ut four and six per cent
would provide that the Auditor of the Slate,
with whom the bonds were to be registered,
should annually levy tax upon the. assessed
property of the State Tor county and munich
palityl which shall be collected through the
proper officers Of the State. county, or muni,,
ersdp 70 for ohe Tie nps @ 81
the Interest aud the raising Of sinking fund
for extinguishing the indebtedness, Should
tax then the bohdholders shall have the right to
apply to any court of the State. whose duty 1t
aahall be to issue 4 nereemptory n ,ndamus to
law furthermore provides that no Injunction or
stay Of proceedings shall be granted by any
court pr Judge q tie the State to pEeyent or delay
thnt this enactment could not now be given in
full, because It might yet DO subjected to serious
seratin as Of Mr. judah 7. Beniamm.e Of Lon Sne
don, and y. y NJ. Barlow, Of this CITY. who both
agreed that II would secure this desired end ii
adopted by the several States. The Suites
which would be asked to pass II were Virginia
North Carolina. south Carolina. Florida. A a.
hsIiam. Louistnna. Mississippi; Ark.nsas. Kan
sas. Texas. Nebraska. Minnesota and Iowa.
NOT 'rHrLAsrHRor1c' ENTERPRISE
-Four. years ago. Mr.. McKinnon said. he had
formed in London company for this purpose
and had correspondence with the Governors OF
Fsaba A NE aad j ao b who
reason why 1t was not then passed was that the
company was. weak and no confidence was
placed In the then hackers OF the project Out
81 the 5000 900 200 worth of bonds not over one
tenth was. held Id this country, the remainder
being Ia europe. when asked hoy large Q pro-
tors he spliied and frankly said. "A very large
amount. but. of course, you understand that
we dor't claim this TO be charitable or ph ilan-
followed by a statement Of what Mr.. Mckinnon
meant to do this winter in the matter. He would
sesn VII Bnnda he sa q ws w IT,
s ssS0OO0V KaHs ass' satooo s oo5 " Including
county aud mnnicipel; Nebraska. SO 600
with tie city of New Orleans. with It's s2s 5000
municipal debt. ~ayhen asked what reasons he
had for hoping that the States would impose
this burden upon themselves by their own
legi Station In their present embarrassed cOndi
tion. he replied that they could we afford to do
II. AS the assessed value Of the state Of Tennes,
sge, which was about one. quarter OF the actual
yalue was 5000 o0O 600: OF Arkansas. 5000 600:
OF the counties and municipalities OF Kansas,
$3.50 100000: OF Nebraska, o,oo0ooo: and OF the
city of New Orleans. 5000. 100000. He also dwell
upon the importance wuich those States would
attach to tho practicability Of thus restoring
their credit.
WHAT MR. FRENCH SAYS.
Mr.. French. q director of the. First National
Bank. being called upon ia relation to the mat
ter expressed great astonishmenr that the
Herald should have been informed by the prin.
cipal promoter of any OF the facts. -,
You don't want to see the baby before it's
Vet even received word from Albany whether
has been granted. You must not publish any
"nut, Mr.. French. is not Mr.. McKnnon, who
has requested the publication in the Herald.
your legal representative?
such indiscretions.' Mr.. French Wrathfully re-
piled, and ralying IA attendant darkey, ne
babe him fly forthwith to mat gentleman man with
published one or two Of the signers Of the ap-
plication would certainly withdraw.
Mr.. French admitted that the firms quoted by
McKinnon had taken up the project. bat denied
that there we're any others, as the five firms
above named meant to keep 1t all TO themselves.
glad to restore their credit by having their
bonds, which were sold oil the way, from one
and a half to forty-three cents on the dollar.
funded at four per cent.
INTERVIEW WITH Ex-sECRETARY MCCULLOUGH.
Representative from the Hefdtd went to the
Gramercy Park Hotel, where ek-Secretary Nc
Gullougll and family are stopping, and Mr.. Nc
Cullough, in reply to the questions propounded
70 him. said In substance, tnat ior some tme
ers Of American States. counties and cities
whose bonds were in default had made up their
these communities pay their honest debts, and
hence the org ,nzation of the association now
under this discussion. AS yet the organization
YVES not complete, numerous details would nave
to be arranged; 1t had not cven yet been de- ot