The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1896-06-17
BOND SALES.
Secretary Carlisle Tells Why They Were
MadA.

washington, uuc Ao.-oeCre tary Car
isles reply to the subcommittee of the
senate finance committee charged with
the investigation of the sale of United
States bonds during the years 1894,
1895 and 1896 was made public Tuesday.
The statement is dated June 1. Review
ing the conditions which led to the bond
issue. the secretary says:
Largely on account Of apprehensions in
this country and abroad as to the ability of
the government TO continue the current
redemption of its notes in gold coin and
maintain the parity of the two metals, the
exports of gold during the fiscal wear 1893
reached the unprecedented amount of Sos, :
$50, sA, nearly all of which was withdrawn
from the public treasury by the presenta-
ton of notes of redemption. Notwith-
standing the most strenuous efforts by the
department to maintain the 800 oCO 600 re-
serve intact. on the I'D day of April, 1893,
IL became necessary TO use a part of IL
for redemption purposes, Very little gold
was being received on account of dues to
the government, and it was. therefore, i'm
possible TO increase the reserve without
resorting to the issue and sale of bonds.
under the authority conferred by the re-
sumption act
The secretary then refers to the bond call
of January II. 1894. which netted the govern
O..
Der IA, 1894, when the free gold in the treas
ury was $6l. s7s, s74. the amount varied but
little. The secretary then continues:
In the meantime. the frequent presenta-
ton of notes for redemption in gold by IN
dividuals and institutions not desiring for
export clearly indicated the existence of
uneasiness in the public mind, while for
eign exchange was constantly at or near
a rate which made il necessary to export
gold to pay bills at their maturity, and con-
seQuently Withdrawals for shipment were
daily threatened"
The terms and result of the second bond
issue are then stated. and Secretary Car
Isle says:
1T soon became evident that the transac-
ton had not been effectual to stop with
drawals of gold These large Withdrawals
were due almost entirely, so far as could
be ascertained, to feeling Of apprehension
in the public mind, especially among the
holders Of our securities abroad, which in
creased in intensity from day to day, that
the government would be compelled within
a few days to suspend gold payments and
to drop to silver and paper standard. The
situation was so grave that the attention
Of congress was called TO the subject on
January Is. 1895"
After freely quoting from this message.
the secretary says that congress having
failed to pass any measure for the relief or
the treasury, or to take any action calcu-
lated to allay the serious apprehensions
then existing in the public mind, a contract
was entered into on February 8. 1895, with
August Belmont & Co.. Of New York; n.
NJ. Rothschild & Sons. of London. and J. p.
Morgan & Co., for the purchase Of $500. 900
ounces of standard gold at the price Of
II. 8o441 per ounce, to be paid for In United
States 30-year four per cent. bonds. Not
less than one-half Of the gold was to be
procured abroad, and the parties agreed
so far as lay in their power to exert any
financial influence and make all legitimate
efforts to protect the treasury against the
withdrawal, pending the complete perform
ance OF the contract
The secretary quotes from the presidents
message. sent TO congress Immediately on
the execution Of the contract, in which he
again calls attention to the financial condi-
tion- of the treasury. 1.-The agreemsnt to
protect the treasury gold, the secretary
says, was faithfully carried out, and he
ADDS:
AFTER e large part of the gold had been
furnished from abroad, the secretary, in
order to prevent disturbance IN the rates
of foreign exchange at a critical period
and create condition which could force
gold exports and consequent Withdrawals
acQuiesced in q departure from the con-
tract requiring one-half Of the coin to be
procured abroad and accepted deposits of
gold then held in this country to complete
the delivery"
Withdrawals of gold again set In, and on
December 2, 1895, the president again sent a
special message to congress asking rem
edial legislation, but none was enacted, and
asking for subscriptions for s100, 000, 900 four
per cents. Of the same character as the
others. Continuing. the secretary says:
Ny opinion is that the prices received
by the government for the bonds sold in
1894, 1895 and 1896 were as high as it was
possible to obtain under the circumstances
existing at the times when the sales were
made. The fact that bonds are offered for
sale by the government only at times when
the financial affairs Of the country are
greatly disturbed and the market more or
less depressed on account Of the business
situation, and the feeling Of insecurity
which always prevails at such periods
among investors, necessarily prevents the
realization Of as good prices as might be
procured If advantage could be taken of
the most favorable opportunities for effect
ing the sales. The same conditions which
make the issue Of bonds necessary also de-
press the price Of such securities In all the
markets of the world and consequently tho
government Is compelled to make its sales
under the most unfavorable circum-
stances"
I'm relation to that part OF the resolution
which directs the committee to investigate
and report what effect the bond sales had
on the credit and business Of the people
of the United States have the honor to
say that, in my opinion. the sales were
necessary for the preservation Of the credit
Of the government and the security of the
business interests Of the people and that
they, in fact, accomplished those results.
In general. the effect of each sale was to re-
store confidence, for the time being at
least. in the power and purpose Of the gov
eminent to maintain its own credit, to pre-
serve the parity Of our coins. ard the value
of our currency, and to check the return
of our securities in large amounts from
other countries for sale In the market
here"
More Pay for Letter Carriers.
Washington, June 1.-THE senate
passed bill increasing the pay of let
ter carriers, which was sent to the