Lancaster daily intelligencer. [volume] (Lancaster, Pa.) 1864-1928, 1881-02-22
Aancaster tnteiltgenrer.
TUESDAY EVENING, FEB. 22. 1881.
A CauSeleSs GrOwl.


There seems to be unanimous ex-
preston of disgust from national bank
presidents anent the three per cent.
bonds offered by the new funding
bill in exchange for the government
bonds falling due this year. This is
natural, no doubt, if it is not wise. Even
though the measure was as unjust as the
banks claim it to be. since it is inevitable
and is passed with the strong approval
of Congress and the people generally, it
would be more graceful and more judi
cious for the national bank owners to
consider that they may possibly be alto
gether wrong about it and to conduct
themselves with becoming modeSty OF
assertion accordingly. Particularly is
this suggested in view Of the fact that
the prices of the shares in their corpora
tions are daily ascending and are higher
now than they have ever been. The three
per cent. investment which is offered
them for the bonds upon which they are
permitted to issue ninety per cent. IN
their promissory notes. does not alarm
the holders of their shares. or induce
them to change their opinion of the
profitablencss of their investment. o.
viously if money invested in United
States loans only brings three per cent
interest national bank shares which pay
anywhere from six per cent. up to fifty
per cent. become still more desirable as
investments.
1t seems, further, from calculation
made bv treasury officials, that the banks
will really receive greater profit on the
three per cent. bonds than they have on
the four per cents which they now large
" hold as a basis Tor their circulation
and the market price of which is about
ia. Putting tho three per cents as
worth par, the profits to the banks OF
the investment in tlllec per cents, Will
the market rate or interest at five pei
cent, would he 15., while that on the
four rer cents would be 1.l9; with th'
rate of interest six per cent. the protl
on the four per cents would he reduced
to 1.15 and only "a ]. .42 on the three $; a
seven per cent. the profit wonld be lOl
and LIB respectively. So that the bank
seem to have need congratulate them
selves that they are offered an OnportG
nifty of selling their four per cents. ant
replacing them with the cheaper ney
bonds.
The interest received from the govern
ment by the banks, it must be remem
barcd, is mainly Il gratuity to them. Th
bln.. that deposits hundred thOusan
dollars of three per cent. bonds with TIN
treasury obtains in return ninety thOus
and in bank notes, which it loans to it.
customers, less the reserve it has to kee
on hand, al say six per cent. interest. 5
that it receives upon its ten thousan
dollars invested, left with the govern
ment, three thousand dollars interest.
has to he sure to keep reserve and
pay taxes, but every business is sui
ject to these burdens and, rs the treasul
figures show, there is a handsome prof
left to the banks after allowing for IL
interest lost by them Oh their reser,
fund. Ii nobody is ever more oppresst
by the government than are nations
bank Stockholders by the funding bi
there will be no just complaint again
congressional legislation.