Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1896-01-16

the President Regarding q bOIlu
Issue and the Syndicate's Will
ngness TO Enter Into a Contract.
New York, January 15.-The govern
ment bond syndicate has been dissolv-
ed. Members of the syndicate received
in their mail this morning a circular
letter from J. p. Morgan & Co., releas-
ing them from their commitments to
furnish their pro rata OF Sl0O,00O,OOO in
gold and a second $1OOOOOOOO if desir-
able, taking their payment therefor in
4 per cent government bonds.
Accompanying this letter was a circu-
lar explaining why the syndicate was
formed, what action was taken on It's
behalf. and why it is now dissolved
The reasons given for the dissolution
of The syndicate is that the syndicate
contract called for bid of AL or none,
and therefore Mr. Morgan was unWlll-
ing to- make a bid under the present
circumstances. as he might seem to
present for consideration by the Secre-
tary of the Treasury and the throwing
out of smaller bids made in good
faith under the public call. The only
emergency, in Mr.. Morgan's judgment,
which would justify such course
would be the failure of the public to re-
sp0ud to the call of the government
TIC has been necessary to delay the
diss0lying of the syndicate up to the
present time aS every financial inter-
est required the protection afforded by
the knowledge that the syndicate was
in existence, prepared to make the
loan a success under any circumstances.
THE CIRCULAR CONCLUDES:
"I feel perfectly satisfied that there is
no question rs to the success OF the
loan"
"On the 23d of December" Mr.. Nor
gan says. IL was invited to Washing
ton for a conference During my visit
there no negotiations for a loan were
even suggested. nor was there then or
since any agreement or request that
should take any steps preparatory to
making a contract. I came, however,
10 the conclusion that the President
and Secretary OF the Treasury would
use every power at their comaDd TO
restore and maintain the gold reserve;
that 10 steps would be taken until il
was ascertained what Congress would
do; that the executive department
would prefer to secure 5000, 100000 O.
gold and that 1t was certain that r.
relief could be obtained from Congress.
Upon my return. appreciating the
gravity Of the situation and in order
that l might be prepared to act prompt
ly. / took steps TO ascertain TO what eX-
tent it would be possible 10 secure the
cooperation of capitalists in forming a
syndicate which would agree to sell to
the United States government $780,,
10000 of gold coin. The contract pre-
pared and signed by the participants
did not stipulace whether the purchase
would De by private contract or by pub
lie offer. The only provision in addi-
tiOn to the important one that no gold
should be withdrawn from the treas
ury. was that the minimum amount of
the contract should be $100.OOOOO0 and
the maximum not over 5000, 900.
The applications far exceeded my ex-
pectauons. At The end of three or four
days the total of $2OO.0OO,00O was
reached. and had full authority which
would enable me whenever. or however,
the executive might decide to act to
secure that amount of gold for the treas
Ury reserve in exchange for United
States bonds"
The participants may be divided
into four classes:
DUnDr II IN IrT~DO ODTr
who were prepared TO ship gold to this
side. second. institutions i'm the United
States i'm possession of gold coin who
wanted bonds either for investment or
as a basis for national bank circulation:
third, banks in various cities who are
willing 10 exchange their gold for
bonds. expecting afJerw3rd to sell them
i'm the market; fourth. institutions and
firms not having gold. but which would
get il at whatever cost, provided the
contract was put in force. Participants
were about equally divided batw en- the
four classes.
Having completed the syndicate !
entered into negotiations i'm Europe and
in places other than London where the
market was closed to us. and through
the Deutsch bank and Messrs. Morgan.
Harjes & Co. Negotiations were prac-
ucally concluded for public subscrip-
ti0ns I'm Germany. France and Holland
which would have resulted i'm a large
amount of bonds being placed in those
countries.
ON January 4. realizing that the ten
sion was growing daily and had be
come serious I addressed q letter to the
President. calling his attention to the
situation and representing that the
most important step was the restoration
of the government credit by replenish-
ing the stock of gold. Details of what
was proposed We're given and assur-
ances offered that the utmost efforts
would be made to procure for the treas
ury II. 500 600 ounces of gold"
The following is the text of Mr.. Nor
gan's letter to President Cleveland:
New York. January 4. 1896.
To the President Washington. d. c.:
Sir-It is with great hesitation that
venture to address YOU in relation to
the presen fnCncial situation. You
are doubtless we'll aware financial af-
fairs are approaching a serious crisis
and the tension to-day is extreme. and
while no outward evidences have de-
veloped we are likely at any moment
10 reach the point and consequences
which it WI then De- too late to rem
edy. The gravity of the situation must
be my excuse. The most imnortan+
step at this moment is the restoration of
the government credit by replacing the
gold reserve in the treasury bsvond
question. This once Accomplished.
confidence both at home and abroad i'm
The stahilitv of orr cnrrancav- will hn