Birmingham state herald., 1896-01-12
WALL STREET LAUGHING Country Banks Can't Get Their
 Bids Filed. THE SYNDICATE REMAINS 0rganzed-Not Over Thirty Millions Will Be Subscribed and the Syndicate Will
 Get the Bonds

New York, Jan. 11.-(Speciat) Wall street is literally laughing in it's sleeve at the seriousness with which some peo- pie are taking President Cleveland's bluff at selling bonds by popular subscription. The men who control the gold that will ultimately be paid for the bonds know that Secretary Carlisle's call for public subscriptions to the issue was a bluff pure and simple-a play to the galleries intended, as Wall street believes, to make political capital for the president.
 Very little is said about 1t, but it is known to all well-informed politicians in this city that President Cleveland has always been on very good terms With Wall street. His recent warlike meS- sage for a moment alarmed some Of his friends in the street. but they have recov- cred from their fright, and their faith In the president is fully restored. When 1t was announced that the government would sell $100,000,000 of bonds to the Wall street syndicate the managers of that organization expected the hue and cry that was raised against allowing them to make a profit of $10,090,0 900 out of the deal. They were mot in the least surprised when the call for general sub. scriptions was issued and it was an nounced from Washington that the pres ident had never made any agreement with the syndicate.
 During all the excitement the mana gers of the syndicate have not said one word for publication. but 1t is known in Wall street that the syndicate has not been dissolved. It is intact today. and IS so manipulating the money market as to make it absolutely certain that its members will get the bonds.
 In the first place, popular subscrip- tions, it Is known from former experi- ence, will not amount to more than $30,- 100000. and the prices bid will not aver age as high as the offer of the syndicate. New York banks are able to keep down so-called popular subscriptions in this way A country bank bidding for $100.- 900 of bonds would ask it's New York correspondent to procure for it that amount of gold, purchase the bonds, hold them as security and then send to the country bank the amount in currency. This the New York bank can, as a matter of business. refuse to do. To the country bank that has no idle capital there is no profit in buying the bonds unless, they can issue circulation on them or obtain currency for them in New York.
 Most of the New York banks have agreed that as matter of patriotism lC they will refuse to draw gold from the sub-treasury to enable their country cus- toners to buy bonds.
 The syndicate managers have reason to feel very well satisfied with the agita- tion that resulted in the call for popular loan. The indications are that the call will enable them to secure the bonds on much better terms than they would have obtained on a contract like the one made last year. By the-terHlse of that contract the syndicate was bound toNprotect- the gold reserve in the treasury for a num- Der of months and that was done at loss of some of the original profit of the deal. Now that the syndicate can go in and bid for the bonds without conditions they will not be bound to protect the gold reserve or to bring gold from abroad to pay for a portion of the issue
 It is evident that the net resultsof all the talk and agitation about popular: loan will be that President Clevela nd will get some lltical capital of doubtful val ue out of it; the Wall street syndicate will get the bonds on better terms than. they proposed originally; the agitators will get some free advertising: the coun-s try at large will get some valuable ex- perience, and the tax payers will foot the bills.
 The experience to be obtained by the country at large will be rather expensive. Until the matter of the sale of the bonds Is finally settled. which will be some time in February, 1t will be difficult matter to obtain money in New York for invest ment in any sort of industrial enterprise. Money cannot be borrowed on time now except at high rates and on gilt-edged security.
 As usual, the south and west will suf- fer more than other section from the present situation. The money needed to carry forward industrial enterprises in the early spring or to>establish new ones in the south cannot now be obtained on favora ble terms.