The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1881-01-13
For the DiSpa ch.
Resurrection Of Real Estate.

For the DiSDa ch.
Resurrection Of Real Estate.
Real estate has seen its greatest depres-
sion, ana 1t " i'll now keen, and be not any
LONGER The dreg OH the market that 1t has
been. Max the prediction
When the Government assumed 10 eXer-
else control over The money OF the country
II entered upon danger us ground, and un.
Gcrtook an unauthorized power IN respect
TO it,.
In the round OF its Transactions with The
trade and credit OF the money markets II
has al length produced The consequences
which il was sure TO have 10 encounter some
wav. Ii has by lis arblIraiy swgy in money
b. ought down the Interest on its bOnd> To
3 per cent, and thus Ouencd the door to
cOmre:iliOn for the money which It bad
previously mOnopOllz' d. Already a large
am0nnt Of the investments III this county
in United states bonds Is being diverted TO
other channels rather than accept OF tie
terms 0f refundlEg at the low rates OF in
terest prescribed by the authorities at Wash
iBotOn.
Tne scales begin to drop from peoples
ewes, and blind infatuliion Of preference OF
security that had no absolute pledge Of
value Orer one that hat Is beginning to
lose its cbdrm over common sense IN such
matters. Three thousand dollars loaned on
real estate worth a, 900 at present values, at
:. or even ut 6 peI cent, is far safer and
more cOmpensatiDg to capital than that
amount vested IN Goycrnmen; bonds. We
are not decryiu0 Government bonds for
they are too popular for that, even il we
were so disposed. But ne can talk OF them
a. matter Of plain business interest 10 us
all 4, l.. oIf ~, Ia hat - In
5000 900. 900 Of Government bonds soon
failing due large part OF them Will not be
refunded at the very low rate of interest
now prescribed for them, aud that the mo-
ney Will readily seek other channels OF in
yestnpnt.
once let it be demonstrated that loans or
investments in real estate ale sure Of as safe
a return a, Government bonds. and people
will quickly enough give them the prefer
ence at even equal rate OF interest. allowing
for lax from which tbe honds are exempted.
Ii we admit thai Government bonds are
equally safe WITH loans on real estate, then
the rate Of 8 per cent. On them will CON-
pare unfrvorably Wrh real estate al per
ceut., and even less.
1ne employment Of money will only just
ify a reasonable price for lis use. and ii can
seldom be emf nyed 10 advantage at price
higher than 6 per cent. per anDum. IL was
the opinion Of that gicat thinker Adam
Smith that the average excess production
Cf man, under tDe most favor bic conditions
Il society, could not exceed per cent.
That H., that the product Of industry. allow
ing for the expense and ncd. mt waste and
loss, would nOt leave a. the tual annual re-
ward OF labor but per cent. OF the gross
yield. Capital Is III respect to production
OF the exact same nature ~ labor, since it
supplies The PR sent necessary wants and
c canVPnipnt implements Of labor, and can
only share relatively with labor in their
mutual product. Exceptional cases will
show much greater results, and again 9th
ers much less; but the average accruing
profits OF labor and capital cannot range far
from 8 per cent, and thls weld would make
vast riches after revolving centuries, but
for an element OF wear and lear aud decay,
that. like an everlasting moth, Is silently re-
tuning To dust and unsig igbtiness the wealth
aud structures OF men.
Consequently an undue rate Of interest
cannot be maintained long, and the recent
high rate Of A. has only been kept upas long
a. II has bV our governmental policy IN re-
Spect to lnoney-lts MONOPOLY OF II, and its
prohibiting bank loans on real estate. while
Us own high rate Of interest should be in
cluded: for lis per cent, free OF tax, is
equal tC per cent. can Jared with other
securities on when lax muSI be paid.
Returns for loans on real estate made at
reasonably low rate may as certainly be re-
lied on rs II made on Otner securities; for
it i from the earnings OF the money bOr
rowed that the price for The Use Of it is in
all probability 10 be derived. and IL matters
not what was the kind OF security pledged
for the return OF IT. TIE >utiiclency OF The
security is another matter; and a. to real
estate, there u nothing, absolutely nothing,
within the RANGE OF human Knowledge, that
is equal TO il for this pu pose.
After the war was over, the Government
manifested its power over ne credit OF the
country. Ii made it, paper a legal tender,
and tbe sense Of security felt by lis creditors
and bondhOider> as TO rbe safety OF tbeir
claims was derived from the conviction that
the Government could do wnat il pleased,
and that 1t had sufficiently pledged itself
for the Davment OF us Gebt. TINS pledge
was all, however; for nothing OF the nature
of The usual pledges Of trade and commerce
were given; and when we seek for an eX-
panallOn Of the unb0unded confidence in
the obligations OF the General Gnvernment
over those OF the States we can explain IL IN
no way but by the impressions formed OF
the power OF the former above that OF the
laIier; aud yet bolh are representative gov
and but a few years since the
CT edit OF the States was equal aud even far
better than that Of the General Government.
Ii was the high rate OF interest Tor loans,
and particularly loans on real estate, that
served 10 lessen the chances Of this interest
being paid-not that there was any vice in
The nature of sucU loans, but that the prob
abilities, with the most honest intentions
and endeayors, would favor at least flucln-
ating chances OF success where the price
was calcnlsted to impOyeIsh the enterprise.
This dsparsging and depressing effect on
real estate viii ere long disappear. aud the
influence ii has so Ia'gely contributed to-
wards the almost mysterious decline OF real
estate will lie soon yapOrlzed before the re.
turning evidences OF the utility and Udtue
Of this kind OF properly.
And II should not be overlooked or I'M
ieryalued that the harmonious relations OF
money capital and real estate being re-
stored viii have kindly and sympalhiz-
ng effect between borrowers and lenders;
or the lender viii extend to his debtor
for bis success, and thus feel
IN interest I'm the direct results OF ibdivld- |
rd Industry and enterpris, IA sentiment |
hat is never aroused toward the Govern. |
nent by those who hold lis bIDds. Indeed
he tendencies to aristocrut C and nnsympa-
biZing relations OF capitalists to socieIy |
ave been largely due 10 the bonded debt |
I the country. by which those holding
hem were led TO conceive Of an end OF all
diversity and suffering. {.