The Iola register. [volume] (Iola, Allen County, Kansas) 1875-1902, 1895-03-15
SALE oE The BONDS.
The Discreditabis Deal Made By CleyelasA
and Carlisle.


and Carlisle.
Now that the bond operation Is .
matter of history it Is important to
recall and remember the facts that
have gone to make up that history.
Early in the year it became manifest
that another loan must be made to pro-
tect the treasury and to keep its circu-
lating notes at par.
1t was the duty of the president and
secretary of the treasury to make the
loan upon the most favorable terms
possible. 1t was especially and imper-
atively their duty in making it not to
do anything that could discredit the
government.
In this duty they failed.
The credit of the government was
and in spite of their failure in duty
still is-as good as that of England or
France. Its own people were ready
and eager to supply whatever money
the authorities might call for. Senator
Sherman, whose judgment Is that of an
expert, publicly declared that popu-
lar loan of $500, OOO, 900 at 3 per cent.
would be taken up in forty-eight hours,
and that opinion was echoed through
out the land. AS subsequent events
have shown, European investors were
equally anxious to furnish money in
any quantity at that rate.
With full knowledge of the facts the
president and secretary entered into q
secret negotiation with a syndicate Of
bankers for the placing of the loan. II
was the business of the bankers TO
make money. 1t was their instinct to
drive the hardest bargain they could
where others had no chance to compete.
1t was the solemn duty of the president
and secretary, the trustees of the peo-
pie, to protect the public interest
against their not unnatural greed.
Upon the president and secretary lay
the responsibility. Upon them chiefly
lies the blame for the blunder made.
Government per cents. with only
IL years to run were then sell
| ing in the open market at 10 and III.
Four per cents. with thirty years to
run were therefore worth 119. Yet the
president and secretary, without test
ing the market, without giving the
people a chance, without inquiring
what our own banks would give for
such bonds, secretly agreed to sell to
the syndicate S62. 3l5, 900 of 30 year
per cents, worth 119 or more,
for 1O415 or little less. If there was
any doubt that the bonds were really
worth 119 it is set at rest by the fact
that the loan was subscribed for ten
times over at 1121l, and that as soon as
the syndicate secured control of the
bonds 119 and more was freely offered
for them, with no sellers to take the
offers.
In making this extraordinary bar
gain the president and secretary dis
credited the governmentgravely. They
publicly assented to the self-interested
contention of the bankers that the
that money cannot be borrowed upon
it at less than 3sl per cent. interest on
long-term bonds-a rate much above
that paid by insignificant provinces
and colonies and obscure towns
The bankers knew better. They
showed that they knew better by their
eagerness to get the bonds at 112A
when the time of distribution came.
They are showing it anew by their re-
fusal to part with their holdings at
rate which would make them yield less
than 3 per cent.
1t was perhaps not their business to
enlighten Mr.. Cleveland and Mr.. Car
Isle. But it was the business of, these
two public officials to know for them
selves.
These are the essential facts in the
history of transaction which has not
permanently impaired our national
credit only because our national re-
sources are so illimitable and our ma
tional integrity so thoroughly well
known.-N. Y. World Dem.).