Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1879-12-31
PalAtial Residence Burned.
THE PUBLIC DEBT.
Letter of Secretary Sherman
Respecting Refunding Opera
tiOnS.

Respecting hcluiiuihS OpCia
tiOnS.
WASHINGTON, December 30.-Senatol
Morrill, makes public the following letter
from Secretary Sherman concerning re
funding:
TREASURY DEPARTMENT,
WASHINGTON, December 80. !
Hon. J. S. Morrill,, Of d'e Committee on n
nance OF tie Senate:
SIR-In response to your verbal inqui
ry, have the honor to submit the iol
lowing observations respecting the re-
funding of the National debt:
In addition to the SlS,4l5,OOO OF six
per cent. bonds, payable December
81, 1880, and the $945, 700 payable July
/, 1881, the following bonds OF the
United States will become redeemable
within the next year and a half, viz
Nav !, 1881, 3 per cents, sos, ,44O, $50
June so, 1881, 6 per cents, S264 ,32l $50;
making total OF 72,76l, 100, the an
nual interest charge on which Is 81, 1885,
l24, $50. About one-halt OF these are
coupon bonds, having coupons running
ONLY TO the dates of redeemability, and
if they are not refunded or paid off the
holders will have to be supplied with
additional coupon sheets at the expense
of the Government and at a cost nearly
as great as would pay for the original
issue of the loan. 1t is man.
ifest that these bonds cannot
! be paid of in 1881 and | therefore felt
it my duty to recommend in my annual
report that authority be granted to re-
fund them into four per sent bonds,
thus affecting savings in the annual IN
terest charge of about SlOS, 100000. The
present time believe to be most adj
vantages for such refunding, and we
have on hand four per cent consol,
a bond already well known and popular.
The successful funding Of so large por-
ton OF the public debt into these bonds
| during the past year was mainly due to
| the favorable state OF our foreign and
home trade and the resumption OF spe-
! Gle payments, ana it is my firm belief
| that our wisest course is to fund the re-
mainder OF the bonds bearing high
rate of interest while this state OF affairs
| confines.
The bill introduced in the House OF
Representatives on the 81 inst, by Fer
nando Wood, chairman OF the Commit
ZEE of Ways and Means, provides as fol-
| lows:
"That so much of the authority con-
ferred upon the Secretary OF the Treas
ury by the acts of July II, 1879, and
January 20, 1871, to refund the public
| debt 10 the extent of Sl,5OO0O0,
| as nas not teen exhausted and eXecut-
ed, be and the same is hereby mod
| fled so as TO limit the rate OF interest
upon the bonds yet to be issued, as
authorized by these acts, to rate OF in
tcrest not to exceed 81 per cent. per an
num-" This bill, il enacted as law,
would perhaps be construed as prohibit
ing the sale of bonds for resumption
| purposes at greater rate OF interest
! than "a per cent believe its passage
would be fatal to the reiunding, although
| | should, of course, be happy To refund
the debt into three and half per cents,
| fit were practicable to do so. That three
and a half per cent. bonds would not
now sell for par, | am fully satisfied,
! and | see no reason to expect that such
bond will be more favorably looked
! upon as an investment in 1881 than 1t
would be now. On the contrary, with
the revival of industry and great ac-
tivity in manufactures, signs of which
are already to be seen in all parts OF
| the country, and the constant demand
for money arising thereirom, 1t seems
TO me to be not at all GER
tain. We shall then be able to bOr-
row freely at even four per cent. per
annum, and of the correctness OF these
views | received the most positive as
surances during my visit &C. New York.
With a small supply in the market, the
great bulk OF them having been absorbed
| as a permanent investment in four per
cent. bonds, are now selling for nearly
the best price ever obtained for them,
but it is not probable that this price
can be fully maintained against an ad-
ditional issue of any large amount,
and remind you that
during the last reiunding opera
tions sales of these bonds had to be
suspended more than once, owing to the
derangement in the money market, ana
the uniavorable state of the exchanges,
these causing the bonds to fall below
par, at one time to 9S per cent AS be-
fore stated, think the present an eX-
ceptionally favorable time for refunding
and | am satisfied that the . per cent
and per cent bonds, so soon to become
redeemable, cannot be so safely and SO
profitably provided for in any other
. manner. The very large amount to be
refunded prior TO July =, 1881, nearly
| $500, ,OOO, 900, Is considerably in excess ol
the amount refunded in any one year
and l respectfully submit that the time
now available is none too great Tor tue
purpose. The passage OF the bill intro
duced by yourself in the Senate and by
General Garfield in the House will,
believe, enable the Departmental refund
the entire amount prior to the
maturity of the bonds, fbnt If II
should not result in speedily refnnding
the whole of them that siapseof the bill
which renders apphcsblethe plovSno Ions
of the act of July lith, 1870. VIII lenable
the department 70 calh such btive pei
cent. and six PER cept. bonds, after they
shall have matured, and to redeem them
with the proceeds Of the Sale OF the foul
per cent. bonds 80 authorized. and such
procesds yonld include, OF course, what
eVerprenlum D0nus may llen seIl IoI
While II is not thought safe to assume
that 1Pop resuming the funding opera
4 tions, with the prospect of the
| emission of the four per cents.
I about Pqual in amount to the presen
4 issne, the bonds will remain at a price
nor much, if any, above par, 1t Il
Thought that under the operations o
the proposed bill parties may be induced
10 surrender the bonds now held by
them upon payment of an amount no
to exceed the difference in the interes
between the bonds received and thos
issued.
[Signedl Very respectfully,
john SHERMAN,
SScrstdry.
The Parnell Reception.
BoSToo, December 30.-At a meetin