Omaha daily bee., 1896-05-09
40 noND INVESTIGATION.

~ BOND INVESTIGATION.
The overwhelming majority by which
tho senate passed the resolution direct
ing its finance committee TO "investi-
gate and report generally all the ma.
terial facts connected with the sale Of
United States bonds by the SECRETARY
Of the treasury In the years 1894, 1895
and 1885, must be accepted as evil
denCc of Il very general belief among
senators of all parties that there are
good reasons for making such an in
v~estigation. Notwithstanding the very
earnest and really strong speech against
the resolution by Senator Hill of New
York, which was in fact n defense of
the course of the secretary of the treas
ury, only six democrats voted against
investigation, while eighteen voted for
it. 1t cannot, therefore, be fairly
charged that the investigation is of a
partisan character.
There have been four bond
issues under the present ad-
m"inistration. In January, 1894, the
gold reserve was reduced to $50, 100000,
lliu tpISINNH iuN MS i'Nll'' w NV
any new legislation regarding the issu-
ing Of bonds, as it had been asked to
do by the secretary of the treasury,
the secretary proceeded under the exist
ing law to negotiate the sale of $4,000
900 > per cent tcn-year bonds. These
which reduced the interest to 3 per
cent and gave the treasury a fund of
gold several millions in excess of. the
S1O0,0O0,00 o redemption reserve. This
gave only n temporary check, however,
to the demand for gold and within six
months the reserve was again depleted
TO the danger point. In November,
1894. another issue of bonds similar to
the first one was made and these We're
also taken by a syndicate at a price a
little less favorable to the government
han the first issue. The next bond
issue was made in February, 1895, after
the treasury gold reserve had been re-
duced to the lowest point it ever
reached. and 1t vas in negotiating the
sale of these bonds, to the mount of
So, 100000. that the memorable con-
tract was made with the Belmont-Mor-
gan syndicate. These were thirty
year bonds at 4 per cent interest and
they were sold at u price which re-
duced the interest to a little under 34
per cent. The syndicate agreed to take
the bonds at ) per cen If they We're
made specifically payable in gold, but
this congress refused to do. This rams
action between the treasury and the
syndicate, from which the latter made a
most generous profit, was severely criti-
cised, but the secretary of the treasury
had a good defense in the urgency of
the situation and the refusal of con
gress to do anything for the relief of
the treasury. There was imminent
danger that in Il short time the gold
reserve would be entirely wiped out,
the consequences of which would have
been most serious to the country. The
last issue of bonds, in February of This
ear, was the popular loan" and was
for $~1C0,O00,GO at 4 per cent. Most
of this issue was taken by a syndicate
and the fact that one combination of
bidders failed to make Il deposit on the
bonds awarded to it at the required
time and those bonds were transferred
to the Morgan syndicate, as the next
highest bidder, was what really
prompted the investigation that has
been ordered. The parties who were
thus deprived of the bonds that had
been awarded them brought suit in the
courts against the secretary of the
treasury.
There has been much said in con-
gress and in the press in disapproval
and depreciation of the course of the
Treasury department in regard to the
bond sales, but it is questionable
whether anybody believes that Secre-
tary Carlisle has not acted with abso-
lutte integrity in every case. 1t is to
be eXepcted that the investigation will
be thorough, and under the circum-
stances it is perhaps we'll that it has
been ordered. 1t is safe to say that
Secretary Carlisle will be most ready
and willing to give the senate commit
tee all the information it shall ask for.