Pawtucket tribune. (Pawtucket, R.I.) 1890-189?, 1895-05-21
THAT GOLD CORNER.
~HE BOND SYNDICATE HAS CAST IT'S
GOLDEN BREAD ON THE WATERS.

Expects Later To Reap Vast Profit Gov
ernment Assay Once Cheap and Con-
venient Safe Dcposlt-what Treasury
and Syndicate Oficais Say.
The story from Washington that the
bond syndicate was casting "a financial an
chor To windward I'm gathering up bar
soid In the west and holding 1t for posi-
bic contingencies was verified In Wall
street. The syndicate has been taking
this bar gold presumably at slight ad
vance over assay Office posted rates.
This 10 practically creating n corner In
gold, but instead Of <iking the metal off
to safe deposit vault the syndicate de-
posts 1t at the government assay Office
and takes out assay Office checks, which
call for equal amounts of gold coin. These
checks are held, so that the syndicate has
cleverly made the government act as a safe
deposit company, and while Uncle Fam
has the gold he docs not own IL any more
than the coin held for the gold certificates
which the banks hold on to when they
wish to hoard gold. In each case the gold
appears In the treasury statement but
does not help the free gold figure, which Is
the one which gives the government abil-
ity to meet its promises to pay freely In
gold paper presented for redemption.
At the offices of Belmont and of Nor
gan discussion of the matter was avoided,
as j. p. Morgan, who Is the head and
spokesman of the syndicate, Is now In
England Others who speak for the syn
dicate and represent its views explain that
"under its agreement the syndicate bound
itself TO keep the government gold reserve
intact until the completion Of its contract,
which will be about September. 1t still
owes the treasury some $l3,O00,OO0 in
gold an amount sufficient to bring the
reserve above the limit or to about s104,-
600, 600.
~ hen, again, the expense of the govern
ment between now and September will
not exceed the receipts SO that there will
not be any increase in the present deficit
On tie contrary, there Is n possibility OF
the r ceipts being enough In excess of ex-
penditures to cause decrease in the def
icit.
when that month arrives, there will be
such demand for money in the interior
states 10 move the crops that the rate of
interest will be so high as to preclude any
exporting of gold.
1.-The syndicate Is simply acquiring all
this gold as a safeguard against possible
demand for gold from abroad. IL there
should come such demand and the syn
dicate could not sell bills of exchange In
sufficient quantity to satisfy it, it would
under its contract with the government
have to supply the gold directly or indi-
rectly, and 1t wants to be prepared for any
such event"
The facts were found to be exactly as
stated with regard to the syndicate gold
purchases, syndicate payments on bonds,
the frantic haste displayed by syndicate
agents to get the deal closed up, the artifi-
cial character of the barrier for the preven-
tion Of gold exports and the palpable
weakness Of the treasury situation. Moth
ing was discovered to in the slightest de-
gree weaken the force Of the revelations
which laid bare the motives influencing
the syndicate to attempt a repetition Of
the last exploit that is netting 1t such tre-
mendous profits.
Treasury officials let another damaging
fact escape, and that is the failure Of the
syndicate to import gold from abroad ac-
cording to the terms of the contract with
the administration. 1t was In the agree
ment that the syndicate was to bring in
one. half the gold from abroad 10 pay for
tne DondS. treasury admissions were
made today that doubts are felt as to
whether the syndicate has complied with
that part of the bargain, and the half ex-
planation is made that possibly the pur-
chases from the western refners and smelt
ers are to make up this foreign gold
1t is explained that under the spirit OF
the contract the syndicate will keep It's
obligation If it obtains gold from private
quarters that it promised to import, al
though in collecting the metal it may be
robbing the government sources of supply.
With millions in sight as a reward for
simply withdrawing artificial support from
the treasury and letting the gold begin to
flow through natural channels to foreign
lands and into the vaults of the Wall street
raiders the situation is seen to be full Of
peril Professions of courage or indiffer-
ence on the part OF treasury officials to the
obvious facts will not protect the gold re-
serve or prevent the occurrence of events
that would make another bond call abso-
lutely necessary to keep the government
from going to a silver basis.-New York
World.