The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1895-12-04
SALES OF BONDS.
EFFORTS OF the Administration to Main
tain the Gold Reserve


tain the Gold Reserve.
In consequence of these conditions. the
gold reserve, on the LIST day of February,
1884, was reduced to $685. 1887, having lost
more than $Sl.00O.0OO during the preceding
nine months, or, since April. 1893. Its re-
plenishment being necessary, and no other
manner of accomplishing it being possible,
resort was had to the issue and sale of
bonds. provided for by the resumption act
of 1876. Fifty millions of these bonds were
sold. yielding $3.50 1851. which was added
to the reserve fund of gold then on hand.
AS result of this operation this reserve.
which had suffered constant and large
Withdrawals in the meantime, stood on
the 9th day of March. 1884, at the sum of
$l07. 1880 It's depletion was, however. i'm
mediately thereafter so accelerated that on
the SOth day of June. 1894. it had fallen
to $64.s73.025, thus losing by Withdrawals
more than $42,COO,0OO in five months, and
dropping slightly below it's situation when
the sale of the s5O.OO00c0 in bonds was
effected for its replenishment.
This depressed condition grew worse and
reserve, being reduced to So, 669, 900, 1t be-
came necessary to again strengthen it.
This was done by another sale of bonds,
was realized s5S,5sS,5OO. with which the
fund was increased to s111142,O2i on the
4th day of December, 1894 Again disap-
relief. There was not even lull in the
exasperating Withdrawals of gold. On the
contrary. they grew larger and more per-
December, 1884, and early in February. 1895.
period Of scarcely more than two months
after the second reinforcement of our gold
reserve by the sale of bonds it had lost
by such Withdrawals more than $4,000 00O
and had fallen to 81, 340,1a. Nearly 49,
100000 had been withdrawn within the
month Immediately preceding this situa-
ton.
In anticipation of impending trouble 1
had on the 18th day Of January, 1895. adj
fully setting forth our difficulties and dam
gerous position, and earnestly recommend
ing that authority be given the Secretary
low rate of interest, payable by their
terms in gold, for the purpose of main
tanning a sufficient gold reserve. and also
standing notes issued for the purchase of
silver under the law of 1880. This recon-
mendation did not, however, meet with leg
islative approval. In February. 1895. there
fore, the situation was exceedingly crfti-
cal, with reserve perilously low. and
indicated that the end Of gold payments
by the government was imminent The re-
suits of prior bond issues had been ex-
cedingly unsatisfactory. and the large with
their public sale in open market. gave rise
to reasonable suspicion that large part
of the gold paid into. the treasury upon
by the presentation of United States notes
or treasury notes, and found its way to
the hands of those who had only tenn
porarily parted with it in the purchase
Of bonds.
In this emergency, and in view OF its
surrounding perplexities, it became entirely
apparent to those upon whom the struggle
for safety was devoted not only that our
gold reserve must, for the third time in less
than thirteen months, be restored by an
other issue of and sale of bonds, bearing
a high rate of interest, and badly suited
to the purpose, but that a plan must be
adopted for their disposition promising bet
ter results than those realized on previous
with number of financiers and
that the bonds described in the
ty years after their date. bearing interest
amounting to about ss2.oo6ooo. should be
amounting to little more tnan SIS. O0o. 900.
This gold was to be delivered in such in
stallments as would complete its delivery
within about six months from the date of
the contract, and at least one-half the
amount was to be furnished from abroad.
1t was also agreed by those supplying this
gold that during the continuance of the con-
tract they would by every means in their
Withdrawals.
The contract also provlued that. il Con-
gress would authorize the issue, bonds pay
able by their terms in gold, and bearing in
terest at the rate Oh per cent. per annum.
par for the per cent bonds described in
the agreement. On the day this contract
was made its terms were communicated TO
Congress by special executive message. in