The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1895-06-29

part of the government and enormously
profitable to the syndicate. To a proper
understanding of the situation it is nee
essary TO recall some facts of recent his
tory.
From Dec. 1. 1894. to Jan. %. 1895, the
Withdrawals of gold from the United
States treasury averaged about $780,
600 per day. For the = ten days end
ing Feb. l., the with1rawa's averaged
in round numbers SO. 900, coo per day. The
total Withdrawals from Dec. 1, 1894, to
Feb. 1S. 1895. were $50. 7s6. 1902. 1t was
under these circumstances that the ad-
ministration made a third issue of
bonds to replenish the gold reserve. On
the sth of February, 1895. the Secretary
Of the Treasury singned a contract with
August Belmont & Co, of New York,
don. and themselves, and Messrs. j. p.
Morgan G. Co., on behalf of their Lon
don house and themselves, FOR supply
ing the United States government with
3.500.0 900 ounces of STANDARD gold coin of
the United States, at the rate Of SIT
and a fraction per ounce, payable in
United States 50-year four per cent.
bonds. The negotiation was conducted
secretly. and it's consummation was a
surprise to the country. The President
sen a special message to Congress,
Feb. s. announcing the fact, in which,
among other conditions of the contract.
he said: "At least one-half Of the gold
to be obtained is to be supplied from
abroad, which is a very important and
favorable feature of the transaction"
This was stipulated in the contract, and
1t was one of the arguments by which
the President sought to give a favorable
aspect to a transaction which, in all
material respects. was immensely adj
~vantageous to the syndicate. The entire
amount of gold due from the syndicate
has now been paid into the treasury.
and instead of one-half, less than one
fourth of 1t has been obtained from
abroad. BY another condition of the
contract the syndicate bound them
selves to exert all their financial influ-
ence and make all legitimate efforts to
protect the treasury Of the United
States against the withdrawal Of gold,
pending the complete performance of
the contract.
Under this contract the reserve has
steadily increased, and the Withdrawals
of gold from the treasury ave almost
entirely ceased for the time being. To
what extent the latter is due to the eff
forts of the syndicate to protect the
treasury cannot be known, but as the
contract is now completed, they are un-
der no further obligation in this regard,
and, for all that anybody knows, they
may begin to draw gold out of the
treasury themselves within thirty days.
The American half of the gold which
was to be supplied under the contract
was paid many weeks ago. and the final
payment on the so-called European half
was paid last Monday. 1t was this pay
ment tina brought the reserve up to
$1O7, 900. 900.
A curious feature of the transaction is
that the entire payment of what Is
called the European half of the bond is
sue should have been made some months
sooner thar the syndicate was bound
by the contract. TO make 1t. 1t is be-
lieved that this advance payment effects
a large saving in interest for them, and
that instead of drawing one-half of the
gold from Europe, less than one-fourth
of it has come from abroad. Efforts to
ascertain the. truth or the latter point
have been politely brushed aside. by
officers of the treasury and sharply re-
PEELED by the syndicate. When j. Pier
pont Morgan, head of one branch Of the
syndicate, was asked for an explanation
on this point, he replied: The only ex-
PLANTATION / nave to offer is that it is
nobody's business what the syndicate
does" 1t is probable that a congress
sional investigating committee will
make it its business next winter, and
require a very different answer from MIR.
Morgan. If the stipulation that at least
one-half of the gold to be supplied by
the syndicate should be obtained from
Europe was, as Mr.. Cleveland said in
his message to Congress, "a very impOr-
tant and favorable feature of the trans
action Congress will be apt to insist
on own whether it was complied
with.