The Providence news. (Providence [R.I.]) 1891-1906, 1896-06-10

a
sary to export gold 10 pay bills at their
maturity, and, consequently, with
drawals for shipment were daily threat
ened. Some shipments OF gold were
actually being made, and as the season
was approaching when large exporta-
tions nearly always occur, IL was cor]
sidered absolutely necessary for thu
maintenance OF the public credit and
the continued execution OF the none
tary policy declared by congress in the
act OF July IA, 1890, and repealed in the
act OF Nov. 1. 1898. TO resort again to an
issue of bonds. Public proposals ac-
cordingly were Issued for the sale Of ad-
ditional per cent 1o-year bonds to the
amount of $50 ,O00,0 900.
-Four hundred and eighty-six bids
were received, amounting 10 S17s, ,S36, 90.
nearly all of which were at rates which
would yield TO the investors per cent
or less. One bid for the whole sum of
S50,00o000, all or none, upon the basis
OF ISIS per cent, being the most advan-
tageous offer for the government that
was made, either singly or by aggre-
eating the separate bids. was accepted.
The payments into the treasury on
account of this sale, amounting TO $751;
53S,500, were not entirely completed un-
I'll after Dec. /. 1894, and IL soon became
evident that the transaction had not
been effectual TO stop Withdrawals OF
gold. These large Withdrawals were
due almost entirely TO feeling OF ap-
prehension In the public mind, especially
among the holders of our securities
abroad, which increased in intensity
from day to day until 1t reached the pro-
portions of panic in the financial CEN
ters, and ii was evident that, unless
effectual steps'were promptly taken to
check the growing distrust, the govern
ment would be compelled within few
days TO suspend gold payments and
drop to a silver and paper standard.
The situation was so grave that the at
tention of congress was called to the sub
ject by a special message from the
president on Jan. eS, 1895"
After freely quoting from this mes
sage, the secretary says that congress
having failed TO pass any measure for
the relief OF the treasury. or to take any
action calculated to- allay the serious
Rpprehenslons then existing in the pub
lie mind, a contract was entered into on
Feb s, 1895. with August Belmont ~ Co.
of New York, on behalf Of themselves
and N. NJ. Rothschild & Sons Of London.
and j. Ps Morgan & Co. OF New York,
on behalf of themselves and j. s. Nor
gan & Co. of London, for the purchase
of 3.500,0J0 ounces OF standard gold at
the price OF $17s0441 per ounce, TO be
paid for in United States 30-year per
cent bonds. Not less than one-half of
the gold was to be procured abroad. AS
an ounce OF gold was worth sls6046j, the
difference between that sum and the
contract price represents the premium
received by the government on the
bonds, mNninB the pft1c A. wnlch tns
bonds we're accepted sl0449i6. AT this
price the bonds would yield the investor
3.75 per cent per annum.
The secretary quotes from the presi-
dents message sent to congress imme-
diately on the execution Of this contract,
in which he again calls attention TO the
financial condition OF the treasury, and
urges the passage on an act authoriz-
ing the secretary to substitute per cent
bonds, payable in gold for the per
cent described in the contract, and call
Ing attention to stipulation in the con-
tract signed that day, by which, II au-
thorized, the new low-rate bonds could
be substituted within 10 days, for the
perscents. A bill to this effect, intro
the contract was completed, the govern
ment issuing bonds to the amount of
Sc. .3l5. 400, and receiving therefor $65, ,116.-
2i4. The last deposit of gold was made
June "A, 1895. but the parties continued
to make deposits until Sept. IL, 1895, in
exchange for United States notes and
treasury notes, the amount so deposited
aggregating S16,l2743 The agreement
to protect the treasury gold, the secre-
tary says. was faithfully carried out.
Withdrawals of gold again set IN,
and on Dec. 2. 1895. the president again
sent special message to congress ask
Ing remedial lesiglation but none was
enacted. and on Jan. 6, 1896, a circular
was Issued asking for subscriptions for
$lOO,OOO,0O0 per cents Of the same char
acter as the others. The bids for this
loan numbered 4G41, and aggregated
scsS,OO0,OOo of which $165. $50. 900, coming
from irresponsible parties, was thrown
out Among the bids received was one
for the whole 500, GOO, 900 from j. j.. Nor
gan q Co. OF New York. at Sil0 6S77.
After accepting all higher bids there
remained $33,17q $50, which was allotted
To Morgan 81 Co. at the price offered.
Ihe total proceeds of the sale, exclusive
OF interest, were sll1, 166,2S2.
Il know Of mo method by which the
market price OF $4,000 900 or s1CO, ,0O0. 600
I'm bonds, all put on the market at the
same time and to be paid for in gold, can
be ascertained. except by Offering them
for sale to the public at large or by ne
botiating with capitalists here and In
other countries, who are acquainted
with the value of such securities, and are
In the habit Of dealing in them. or
course such large amounts offered at
one time cannot be sold for as high
price. payable in gold, as can be obtained
for smaller amounts TO be paid in the
? ordinary way and my opinion is that
the prices received by the government
for the bonds sold in 1894 1895 and 1896
were as high as IL was possible to ob.
tain under the circumstsDces existing
at the time when the sales were made"
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