The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1879-10-23

| markets. The large transactions between
1 the several money centres and the deliver!
of all the subscribed five per centums re
suited in cash balance of about $l5, 000,-
900, which the Treasury agent was obliged
to receive and temporarily to deposit in the
Bank Of England. Secretary Boutwell,, be
ing without authority Of law for holding {
cash balance in foreign country, fastened
the settlement by calling for redemption {
further amount of five-twenties, and per
mitted the closing Of the accounts at last BY
the purchase of several millions of uncallet
five-twenty bonds, which could then be pro
cured on equally favorable terms.
After the close Of this negotiation the mar
kets were unfavorable, and no further pro
gress was made in refunding until january
1873, when a new contract, which embraced
the association Of several conspicuous for
eign houses, was made by Secretary Bout
well upon terms substantially identical witt
the former. Under this contract about 800,
600, 900 fives were sold before the panic Of
| that year.
In July, 1874, funding negotiations were
resumed by Secretary Bristow, who under.
took to sell all the remaining five per cents
under contract upon terms which differed
from those made by Secretary Boutwell, only
in requiring payment by the contractors Of
interest accruing upon the five per centums
until the maturity of the fve-twenties called
against them. But, as the contractors re.
ceived the benefit of the deposit as in the
former negotiation, this stipulation was
equivalent only to charging small premium
upon the per centums, which was war
ranted by the advanced price they were
then commanding in the markets. This
contract, with one or more renewals ex
tended to the end of the five per centun
loan.
Under Secretary Morrill's administration
1875 the credit OF the government had SO fal
improved that the Al per centum loan was
introduced under contract made upon pre-.
cisely the terms accorded by Mr.. Boutwell,
and this negotiation was in progress when
Secretary Sherman came into Office in 1877
Mr.. Sherman, recognizing the further inn
provement of the government credit, decided
at very early date in his administration tt
discontinue the sale of the A per centums
for refunding purposes and to introduce in
stead the per centum loan, which he did in
June, 1877. A contract was made for the
sale of these bonds on the same conditions
as for the IS and As, and which resulted in
the sale, by January, 1878, of about $75, 00o,.
600 per centums.
Early in 1878 the Secretary abandoned the
contract system and offered the bonds on
similar terms to all banks and bankers in
amount sufficient to retire the remaining
five-twenty bonds. Under these conditions
the loan was taken during the year to the
extent of an additional hundred millions.
The resumption Of specie payments on
January i, 1879, gave new impetus to the
subscriptions, which in January amounted
to 1882, 1000, 900, in February to $40, 900, 900,
in March to $43,000,000; and on April 4,
the last Of the five-twenties having been
covered, the subscriptions were closed.
On April 10th the four per centums were
again offered in amount sufficient to retire
the 10-40 loan, the price, however, being ad-
vanced to 1901, the commission reduced to
] per centum, and the three months credit
continuing as before.
Under the public announcement Of these
terms an amount was in one day subscribed
more than sufficient to retire $4,000, 900
Of l0-40's, and necessitating the rejection Of
large number of subscriptions.
The refunding certificates which had been
offered as a part of the four per centum
loan, to meet the requirements Of small in
vestors, the Secretary decided not to award
to the large bidders, but their sale was con-
tinued for some thirty days, during which
time they were closed out.
The refunding contract Of 1871 was made
with Messrs. Jay Cooke & Co., who associ-
ated with them other bankers in the United
States and in England, and introduced the
five per centums in London through the
house of Jay Cooke, McCulloch 6 Co.
Their sale of $75,0o0,0OO in three days was
the largest single negotiation OF United
States securities ever effected in the London
market.
The contract OF 1873 included also the
Messrs. Rothschilds, Earrings, Morgans and
Mortons, and in that and the subsequent
foreign negotiations the management was
in the hands of the Messrs. Rothschild Of
London.
The contract of 1874 and 1875 added to the
association group Of banks represented by
the Messrs. Seligman and Drexel, and The
sales in the United States were under the
management Of Messrs. A. Belmont & Co.,
and were largely made by the First Nation
al Bank of New York. From this time I'M
til the close of the syndicate negotiations nc
important change occurred.
During the popular subscriptions opened
in 1878, after the close of the syndicate con
tracts, the sales continued to be made In
great part by the First National Bank Of
New York, and it was rot until the opening
of 1879 that large number of other banks
and bankers engaged in the negotiation o.
the four per centums, SO that the report o.
Secretary Sherman to Congress In March o.
this year exhibited accounts current witt
131 different national banks which had quail.
flied and received subscriptions up to thai
date. The largest single subscription to the
per centums was that Of $4,000, 900 made
by Messrs. Jay Cooke 6 Co., under the con-
tract of 1871. The largest single subscrip
ton to the per centums in the refunding O.
the 5-20s was that made through the Nation.
al Bank Of Commerce, New York, by Messrs
Drexel, Morgan 6 Co., and associates. or
April 4, 1879, for forty million dollars. The
largest single subscription to any Of the
funding loans was that made on April II
1879, By the First National Bank Of New
York and associates for Sl50, 900 four
per centum bonds and s40, 900, 900 refundIne
certificates. Upon this subscription an ag
gregate Of 1921, 900, 900 was awarded TO ths