Pine Bluff daily graphic., 1896-02-20
LLLESSER MORGANS.
HOW SOME FORTUNES WERE MADE
 FROM THE BOND ISSUE.

lon Ills Uppers" Has Already Sold His
 Option For $50 O0O-Nothing to Hinder
 shrewd but Impecunious Spectators.
 Some of the stories told of the profits made on the new bond sale by bidders who went into it purely as matter of speculation, without capital, and appar- ently without responsible backing, read like fairy tales.
 Fortunes have been made in day, and that without the expenditure of dollar or the assumption of responsi- bility.
 It has been in some instances dag zling and glittering realization of wild dreams of financial good fortune. Any man could bid for bonds to an unlimit- ed extent without line of guarantee or the deposit of a cent of forfeit. Ad- yenturers with an eye out lor the main chance could not have imagined more brilliant opportunity to clear enormous profits without a particle of risk and without the deposit of even the most in- significant stake.
 The only wonder is that more did not take advantage of it, for the game was one that almost any man possessed of a little familiarity with financial methods and the rates of exchange might have played with fair chance of winning.
 As it was, some men without dollar to their names and without any personal financial responsibility put in their bids for amounts of bonds which nobody but & millionaire could have been able to take up, and which reputable banking institutions would hardly have ventured to attach their names to.
 All they had to do was to make out their bids at varying rates, with little shrewd calculation as to the price at which the majority of the bonds were likely to go.
 For example, it was pretty thorough ly accepted in financial circles before the bids were opened that any offer of l12 or over was almost certain to com mand block of bonds. Offers below that rate might involve larger profits, but there would be less degree of cer- tainty in the realization.
 It was to be assumed that the large syndicates would take very considera ble share of the bonds at the lowest possible rate, but above this there would be a surplus to be divided among the smaller bidders who made more generous offers.
 All that was necessary, therefore, was for the speculative individual to enter his bid and eomplacently await the result, knowing there was nothing for him to lose and that there was much that he might gain.
 If his name should appear in the list of awards, it would only be necessary for him to go to responsible banker who had facilities for securing gold and sell his option on the bond at good margin.
 There was plenty of time, according to the terms of the sale. It was neces- sary only to make the first payment of 90 per cent in gold on Feb. l5. That day has not yet arrived, but the bonds are already quoted at IT in the open market, and on a margin of that size there could be nc trouble in disposing of the option at good profit. But even if this did not materialize, there could be no risk, for no deposit was required.
 In case of failure to sell the option or in case the rate offered was too high for responsible banker to handle the bonds at profit no bidder was under any obligation to close his contract, and no penalty was involved.
 It is true the government retained the right to reject any and all bids, and several bids for great amounts, notably one from Texas for $19, ,000, were rejected in this way because they were palpably the offers of irresponsible banks. But in list of nearly 5000 bidders it has, of course, been out of the question for the committee on awards to detect every irresponsible offer, especially where the address of the bidder was near some financial cen ter.
 Wherever the government has offered to public competition contracts for pub lie works of any kind, it has been the rule of the treasury department to re quire each offer to be accompanied by a certified check as an evidence of the sincerity and responsibility of the com peting bidder In some instances this safeguard is required by law, and it's object is to prevent straw bidders from entering into competition with respon- sible contractors solely for the purpose of selling or subletting the contract or of throwing it up altogether, in case g purchaser could not be fouIid.
 With the bidders for bonds nothing was required except the ability to make out proposal intelligently and sign name.
 Several instances have already come to light where bonds have been allotted to men who had no intention of trans ferring gold to the government vaults, and doubtless there are others.
 One of the successful bidders turns out to nave been bucket shop operator in an eastern city. who entered bids at different rates for several millions of bonds. More than $l, 900, 900 was al lotted 10 him.
 Before the award had actually been made he had received an offer of $30, 0A0 fa, hio ol,a,oo l,,f r.afr1cad # Sinaa