, 1880-01-13
THE WOOD FUNDING BILL.

tho curly attention of Congress. Tho b!ll |
provides: ~ Tllat all bonds bearing mors
t!lan 4 per cent interest s1inll he refunded
upon maturity into bonds bcaring si,S per |
crnt Interest; f2) TINT tlla Secretary Of The |
TREASURY shalt invest the tuoneyin the Treas
nry In excess Of - per cent of tie u,ltstnn.l-
Ing legaI-tell,ier itotcs In the pslrclnse Of the
O aud 4 per cent bntitls: and {:') that
the provision rclntiye to usc ~ per cent !
popular certificates for ultimate conversion
Iuto bonds shall ba continued lnttcanitly,
under tho condition that not lnure than
SO, 1000 Of sucli certificates shall be out-
stau,lEng ut any one time.
The operation Of tlts hill, If ndopted as 1t
stands, would bo as follows: Tl,esurplns coin
In tim Treasury available for redemption
PURPOSES Is abuut slA0,0c0,0oo. The out
standing }egal-ten,ler nUteS arr, III round
numbers, Slt't, con 600, NO TINT IL 21 pr cent
reserve would reQuirp nbDlt SS7, 600 In
cotn. Thts would release about S5}, QUO, ,000
for tlla purchase Of q per cent b0lnla. We
will uss,,,ne that s5o000,0o0 Of per cent
ho1itls Gun be purchased with this sum. The
amount Of d per- cents outstanding, still In
round numbers, is S473, ,50O, coo, which wollt(
thus be reduced to S:4sas', ,000. The amount
uf i ler cents outstanding is s:ios,44o,ooo.
Tie annunl saving Ut interest under this
scheme would l,e about mi follows:
u, p,,rcl1l,sc 1T f1GN,NsD tbs).. ........$ I00m
t:nhvors!on Of {sSl,GGAlO9 tas}....".... k,hil,tU
Conversion of 6lB,0o0,0O t'sh..."..... 7,G@0,ouo
roto,.. ~, o,lo5,0o
There would be sayIng Ut the interest
now paid Oil the SO, ,000.000 ut por cent
4 ~
05l the remaining 6 per CENTS tU be refunded
imtu ~ pr cents; atld Of ~ per cent NJ the
8 PR cents to be refunded iNtn 3,l per CENTS,
-aggregatng more tlian 3lt',0o0,00o.
While tln principle vi the Wnol bill Is
corritet, tllnru IL difference Ut upinIon III tn
the practical nlM!ration uf the pralH'sc,l pur-
chase Of bonds u,id the proposed rate of In
terrst. II IL cnl,teMlp.l by Secretary Sher-
nan tliut bnl,tlK bcnring n l0wcr rttu tllnn l
prr cent cnnllut !,a sold ut par, while Mr..
Wood contends TINT, If per cent bonds run
hing twsuty-ttght years are worth Ere
M1un nf from tlrce 10 fur ecl,t5. bonds rl1tl-
ming ifty years md hcnring Interest ut the
rNtn Of W per cent viii rultllly brillE lMr.
This II Il tllnttur TINT Gull bo approximately
determined by evidence md discussion. Thg
proposed reduction Ut the redemption fund,
consisting Ut uesllrplus coin III the Treasury,
IL u somewhat dangerous experiment. So
long rs tho Ereenb'cks sNnll rcnlaln lcgnI-
tender there In little reasol, It h true, 10 ai
pEcllusut run upon tho Treasury fur rol,,
| md tho Government Is well pr0,eetclt by
| thu authority To Be!l bt.Itls 10 my umai,t1t,
md bearing interest us high rs i lpr cent If
necessary, for redemption PURPOSES At thu
sane timo II IL Of the highest iunlWrla,.cu to
| keep sllcl, c0in reserve II. tho Treasury ns
| will command enduring public confidence,
md likewise tGfent my ln0Iiey.c0mhinntiUll
orgnlltxc.l to exhaust tho reserve for tho pl,r-
pose Of Sprcuattng in tho bonds 1t would
then be necessary to Issue. II tho relelnp-
ton fund were reduced to S7b,00,0o0 Or
Ss0, zoo GOO. It might pay for Il combinatlon tt'
got that nlnount or greonbackB together md
Withdraw the atock of gold III order tu
shear" tho bond market allL buy In (laygrs,-
nent securities Mt less tllAll their rcul v,l,lr.
Such combination could NOT bu r0sily
formed at the presaut tillo, nor could 1t
ausliy work ont lts object under thu present
Redemption law, but II II tho obvious duty
Of ths Government to project itself a9utllst
any suheine Of tho kind, ansl reduction ni
Eullk lCSGlf nkEP III t41Q y lUllks
direction.
Kelattye 10 tho rate OF interest which It IL
proposed tonttAch to the new rcfuntltng bonds
1t Is not unlikely that 3.t5 per cent N1ay bt
successfully urgetl us compromise between
tlsuso who regnrd per cent as too high nul
those who regard w Imr cant as too low
Other tllugs being equal. tho rato ut I,tH lln:
tho quality of convenience nMl ready cn,ll
putat!on to recommend It. 1t amounts Il
Que cent day on S100, Rlld 1t Is within tht
e,lsy comprehension Of conn,ul, people. TOT
.!ays' intcrrst OIL 81 900 bond IL luaue.llatol,
known To b. 81, eleven tlays' Interest SLID
and 50 Or. Ttle fruct!ons Of Il year, 1Montl,
a1ltl week, ,Rre thus promptly computed, MI.
6o accurately TINT every 1,inn can know lif
due whenever liz desires to p1rt viii, III
bond, II WIS tbs principle on which thu 10
bonds {Iust twice :,tg) were originally Is
SUED, md this rnte will 70 fur toward
nsakiug the new bonds popular ali
us..ful. The favorable experience which Il,
Government haA hau In thu sa!o Ut ~
. cents wnrra,ts tic belief tint the rate OIL til
new bun 'ls nlay DO reduced to 3,t5 per ceIl
, by extending their term to .lfty years, whfc
J undoubtedly adas u their sal,.e for lnves
( ment. Ths great bulk Ut tlle $7sl, ,0oO, ,000 i
! . md yer cents outstanding are ileltl in til,
country, aud, when they shall bu calett in b
the Government, the holders thereof vi
t destsu tho satllu snrt Vi permanent inyes
/ | nielk English collsols, drawing per ee,
interest, arU worth within slnnll fraetl0u l.
. " cents. Auer!can tfty-year bomla woll
, ll1lyo the snllle character as English collsnl
aIl4 tl,e addition Ut G5-1o0tt's In Interest ougl