The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1896-01-07
For Neither He Nor His Cabinet be-
lieves the Masses Can secure Gold
to Purchase the Bonds.
TREASURY RESERVE MAY GO
LIKELY TO BE DRAINED BEFORE
THE CALLED-FOR-IsSUE IS TAKEN.
What Congressmen Say About the Ad-
Views of Foreign Bankers.
70 the Jndianano,is Jo,rna,


tory President Cleveland has yielded to the
opportunities of others. For once he ap-
pears. moreover, to have been bulldozed into
receding from position he has taken. The
announcement that, after all, the next bond
issue is to be a popular lcan' has caused
almost a sensation here. The determination
to break off all further negotiation with
either the Morgan or the Stewart syndi-
cate seems to have been taken very sud-
denly, for. up to yesterday afternoon, not a
Cabinet officer knew anything of such an
abrupt change of plan. At o'clock last
night Mr.. Olney returned from New York
all the Cabinet officers were gathered in and
ordered to report at the White House, ana
there the call printed this morning was pre-
pared. 1t is the general belief that Mr..
Cleveland was appalled, by the unanimous
resentment manifested at his proposed Sc
cret contracts and the deep-seated ami
mostly against New York bankers which is
felt all over the country seems to have been
made plain to him. In no other way does
any one attempt to explain his sudden
move.
No one in Washington, outside the Cap
itol statesmen. has any faith in the sue
cess of the popular loan idea Mr.. Cleve-
land is believed to have double motive In
the first place, he is placating popular feel
ing, which is undoubtedly very. strong in
favor of giving the people a chance to come
to the treasury's rescue with their own re-
sources. But his more important motive is
a desire to wrench from the people them
selves brilliant vindication of his last con-
tract with the Morgan syndicate. Mr.. Cleve-
land and every member of his Cabinet is
assured that this appeal to the people will
%ha xx-sII
finally be taken = by one Of the
New York syndicates He has no
faith in the stories OF the gold boarded
by rural misers in old stockings or old
maids in rusty coffee-pots. At all events, he
does not believe that the present crisis will
bring out these traditional stores. But he
proposes in his cold-blooded way to give the
people another "object lesson"
1t is plain that his popular loan plan will
result in an immediate drain of the little
gold still remaining in the treasury, for it is
an everyday experience that the banks will
not part with their gold, and the two great
syndicates in New York with whom the
President has been negotiating have cor-
nered nearly all the gold outside the treas
ury. Several men in this city who to-day
made inquiries at their banks for gold, with
a view to purchasing bonds, were met with
fiat refusals, and 1t is safe to assume that
banks elsewhere will adopt the same policy.
If. therefore, any large proportion Of the
present issue of one hundred millions is to
be taken by the people, the reserve will be
their only available source for gold, and
within the next fortnight there will be a
constant and fatal drain of the sixty mil
lions remaining to-day in the treasury. IL
the demand among the people to buy bonds
is strong mas been represented then
the end of the week will see the reserve
down to fifty millions or less, and a few
days later the condition of the treasury will
be acutely critical. What may occur then
cannot be foreseen. But Mr.. Cleveland will
have given the people an object lesson, and
the financial misery and disaster which that
lesson may cost VIII, In his opinion, be not
too high price. There is not the least be-
lief at the treasury that the people will bid
for half the bond issue. Ii is the confident
expectation that every bond will find its
way into the strong boxes of the members
of one of the syndicates.
The treasury authorities give as the rea-
son of their lack of faith in the desire or
the ability of the people to buy bonds the
history of previous attempts to float popu-
lar issues. The first sale, announced June
Q, 1877, giving, as in the present case, thirty
days for popular subscriptions, brought in
s6.l16750, but of this amount SOL, $50 was
subscribed by banks and other monetary
institutions, and the great bulk of the sale,
amounting to s76.3i3.lJ0 up to July 16, was
made to A. Belmont e Co., and the First
National Bank of New York. The two re-
cent attempts at popular loans are still
fresh in memory. Under the invitation for
the first issue of fifty millions popular bids
to the extent of S745,i0O were received, and
for the second 81. .533. $50. and OF these many
bids were below the upset price fixed
by the treasury. 1t is worthy Of notice, by
the way. that the present call fixes no up
set' prices.
Mr.. Cleveland hopes to turn the patriotic
anxiety of the people to save the treasury
whose demands he finds himself for once
able to defy-nto vindication for his last
bargain and an Endorsement for the present
schemes which he is compelled for a time
to apparently abandon