The diamond drill. (Crystal Falls, Iron County, Mich.) 1887-1996, 1895-03-16
THE BOND SALE.
the Discreditable Deal Made by Cleveland
and Carlisio.


and Carlisle.
Now that the bond operation IL q
matter of history IL is important TO
recall and remember the facts that
have gone TO make up that history.
Early in the year IL became manifest
that another loan must be made 10 pro-
tect the treasury and TO keep its circu-
lating notes at par.
IL was the duty OF the president and
secretary OF the treasury TO make the
loan upon the most favorable terms
possible II was especially and imper-
ntively their duty In making IL 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 10 supply whatever money
the authorities might call for. Senator
Sherman, whose Judgment Is that OF an
expert, publicly declared that popu-
lar loan OF 5000, 900 at 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 10 furnish money In
any quantity at that rate.
With full knowledge Of the facts the
president and secretary entered into n
secret negotiation with a syndicate Of
bankers for the placing OF the loan. 1t
was the business OF the bankers to-
make money. IL was their instinct to
drive the hardest bargain they could
where others had no chance TO compete.
IL 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 tho president and secretary lay
the responsibility. Upon them chiefly
lies the blame for the blunder made.
Government 4 per cents with only
l2 years TO run were then sell
ing in the open market at 40 and Ill.
Four per cents. with thirty years TO
run were therefore worth 1l0. Yet the
president and secretary, without test
ing the market, without giving the
people n chance, without inquiring
what our own banks would give for
such bonds, secretly agreed TO sell 10
the syndicate SCI, 1915, 900 Of 30 year 4
per cents, worth 1i9 or more,
for 1914 or little less. II there wars
any doubt that the bonds were really
worth 10 1t is set at rest by the fact
that the loan was subscribed for ten
times over at Hex, and that as soon as
the syndicate secured control Of the
bonds 40 and more was freely offered
for them, with no sellers TO take the
offers.
In making this extraordinary bar
gaiRsthe president and secretary dis
credited the government gravely. They
publicly assentcd 20 the self-interested
contention of the bankers that the
credit of the United States is so bad
that money cannot be borrowed upon
it at less than 32l 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
eageYness 10 get tho bonds Mt 1l2A
when the time OF distribution came
They are showing IL anew by their re-
fusal TO part with their holdings at q
rate which would make them yield less
than per cent.
1t was perhaps not their business e
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 arc so illimitable and our ma
tional integrity 50 thoroughly wei
known. IN. " World (Dem.).