The Cincinnati daily star. [volume] ([Cincinnati, Ohio]) 1875-1880, 1879-01-08
OUR .FOUR FER CENTS"


By telegraph we learn that, on Mon
day last, the Government four per cent.
refunding bonds were taken to an amount
exceeding $11, 100000. This is an i'm
mense amount as for the work of only
one day. 1t shows very clearly that the
Government will find but little difficulty
in calling in its whole issue of
six per cent. bonds within short time,
and refunding the amount at four per
cent. instead of six per cent, as at pres
ent. The saving of interest by this one
third reduction of the rate is an impor-
tant item to gain, as it will diminish our
interest account by about $50, 900, 900 an
nually. Of course it is step that the
Government ought to take by all means
practicable.
But, when we see subscriptions for
these four per cent. bonds rolling up to
S11, 100000 in single day, the inquiry
naturally arises as to where all this
money comes from. For some years past
we have been pretty loudly told that
money was exceedingly "tight;" that
money could not be procured to either
start business or carry it on; that men
could not pay their debts because of
money stringency; that families were in
Distress and even aff1uent people impov-
erished because of the impossibility of
raising money on ample security at even
twice four per cent. of interest. And
now money is found by tens of millions
daily to invest in bonds at four per cent,
and additional clerk force is required to
prepare the bonds fast enough to supply
the public demand.
This occurrence is regarded, even at
the Treasury Department, as somewhat
surprising and phenomenal. To the
Administration circles it is naturally
quite gratifying. But, is there not an
other aspect to this matter not so CRATE
full to the public mind? We had conf
IDENTIFY hoped and reasonably expected
that a gradual and general revival of
business activity would follow the re-
sumption of specie payments, when cur
rency could no longer represent fictitious
or uncertain values. Yet, if the money
of the country is to be swallowed up in
four per cent. bonds at the present rate
Of investment, where is the capital to
come from wherewith to stimulate our
business activity? While such rapid and
immense investments in public stocks
may enrich the Government, will they
not tend to impoverish our industries
and straiten the resources of business
These are questions that must occur to
every thoughtful mind.
1t must be granted, to be sure, that the
present period of the year is peculiarly
promotive of such investments. Thou.
sands of our people are just now receiv.
ing their interest incomes on previous
investments, that several millions ir
amount of former bonds have been calico
for payment Of the principal, that hoard
ed means kept from use when currency
was at discount are now seeking invest
ment-that all these sums should be nov
in hand ready for being placed in some
satisfactory securities is unquestionably
the case; and the four per cents. offer
convenient mode of immediate invest
ment. This would account for a very
considerable portion of these rapid sub
scriptions to those bonds.
But, with allowance for all this, th'
amount is indicative of depletion of tn,
means requisite for vigorous business en-