Birmingham state herald., 1896-01-16
TELLS WHY IT WAS FORMED
Also Tells How His Plans Were Knocked in the
 Head.
THE PUBLIC LOAN WILL BE A SUCCESS
He Shoulders All the Blame for Forming the Syndicate and Exonerates Presi- dent Standardization
 Members to Subscribe.

New York, Jan. 15.-The members of the government bond syndicate received in their mail this morning the following circular:
 No. 2S Wall Street, NeW York City, Jan. If. 1S96-Gentlemen: In sending you formal notice of the dissolution of the United States bond syndicate, in which you have co-operated. it is proper that should make some statement showing why the syndicate was formed, what ac tion has been taken on its behalf, and why it is now dissolved.
 On December B last I was invited to Washington for a conference. During my visit there, as have verbally stated to every one who has conferred with me on the subject, no negotiations for loan were commenced or even suggested, nor was there then or since any agreement or request that should take any steps pre- paratory to making a contract.
 The result of my visit was that came to the following conclusions:
 T. That the president and secretary of the treasury were determined to use eV- cry power at their command to restore aud maintain the gold reserve.
 , 2 That no steps would be taken, or even any preparatory negotiations com menced until it was ascertained what ac- ton. if any. congress would be likely to takesin response to the appeal or the president for adequate and improved means for making such restoration.
 3, That the executive department would prefer, if possible, to secure OO,o00,oO of gold, in order to avoid any probable necessity for a similar negotiation before the meeting of the new congress in 1897.
 4 That 1t was absolutely certain that no adequate relief could be obtained from congress, and that no bill could be passed through the senate for the lm- movement of the monetary system of
 the, country.
 Upon my return appreciating to the fullest the gravity of the situation and alive to the fact that early action was es- 'sential, and in order that might be pre- pared, If called upon, to act promptly. | took steps to ascertain to what extent 1t would be possible to secure the co-opera- tion of capitalist institutions and others in forming a syndicate which would agree to sell to the United States govern ment $200. 100000 of gold coin.
 In my efforts, while far from sanguine as to the result the ready acquiescences of James Stillman, Esq.,, president of the National City bank, New York; Edward D. Adams. Esq, with full power repre- senting the Deutsche Bank of Berlin, Germany; John A., Stewart, Esq, pres ident of the United States Trust com pany; Pliny Fisk, Esq, of Messrs. liar vey Fisk & Sons, and many others, to all of whom I am deeply grateful, encour- aged me to proceed.
 The contract as prepared and signed by the participants, did not stipulate whether the purchase should be by pri- vate contract or by public offer. The only proviso Gin addition to the impor- tant one that no gold should be with ,l- ha minimum amount of the contract should be s100, 900 and the maximum the full amount of participations which might be secured before it became necessary to act. not exceeding $200,00O,000.
 The applications for participation far exceed my expectations. At the end of three or four days the total of $200. .0o0, 900 was reached, and I had in my hands full authority which would enable me. when ever and however the executive might decide to act, to secure that amount of gold for the treasury reserve in ex- change for United States bonds.
 The participants may be divided into four classes:
 First, institutions, banking firms and others in Europe who were prepared, If necessary, to ship the amount of their participation in gold to this side.
 Second, banks, savings banks. trust companies and private individuals throughout the United States in posses sion of the actual gold coin who desired to secure bonds, either for investment or as a basis for national bank circulation.
 Third, banks in New York, Chicago, Boston, Philadelphia, Cincinnati and other cities in possession of gold, who, without necessarily desiring bonds for investment, were willing to aid in the movement to sustain the treasury re- serve and exchange their gold for United States bonds, expecting afterward to sell the same in the market
 Fourth, institutions, banking firms and others who, without being in possession of the actual gold, were willing and able to obtain that gold at whatever cost for deposit with the treasury in payment for bonds, provided the movement contem- plated could be carried out.
 may add for your information that the $200. 900 participations were about auallysdivided between the four classes indicated.
 The formation of the syndicate being completed, commenced negotiations for the. permanent placing of portion of the loan by public issue in Europe, should a contract with the government be made. ~
 The London market was unfortunately closed to us, owing to causes to which need not refer. I. therefore, through the Deutsche bank, Berlin, and Messrs: Mor- gan, Harjes & Co.,, Paris, opened nego- tiat1onss TOT puphc issues III 1srnahy' France. Golland, Belgium and Switzer- land, which negotiations were practically concluded, and had 1t been possible to further proceed, doubtless a very large amount in bonds of small denominations would have found a permanent place in these3countries, to the great advantage of every interest. After waiting few days for some announcement or invita- tion from Washington, and realizing that every days delay was serious in the face of the growing tension in financial af- fairs. on Saturday, January 4. I sent by messenger the following letter to the president.
 1896. --To the President Washington. D. C.-lSir: It Is with great hesitation that Venture to address you in relation to the present financial situation. As you