St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1896-01-07

4
! to- purchase some bonds, We'll say, of
Becker county, Minnesota. OF course,
| he'd know where Minnesota was, but
| where in creation is Becker county I?
| After finding the location on the map
| he wouldn't be much wiser. He
wouldn't know anything about the
! character or prosperity of the people
| in that county. Nevertheless, the
| Pennsylvania men used to buy bonds
| quickly enough, and don't you suppose
! that they, or any similar investors,
would be great deal more willing to
/ buy bonds issued by the national gov
eminent? A man may not know much
| of Minnesota; he might be absolutely
1 ignorant of the resources of Becker
| county, but he can't help knowing all
| about the United States. Every citi-
zen, you may say, will trust the ma
| tional governmental he'll trust any
thing at all. Money will be put into
obligations of Uncle Sam even by that
| large class of small investors who are
| suspicious of everything and of every
| body-that class who hoard their mon
| ey in stockings and tin cans, in the
| rusty cook stove, and in cracks in the
| floor This class sometimes puts its
! money into bank, but never without
fear and trembling. With tkeir cash in
| the hands of the government such
people would feel safe, and they would
think themselves very lucky to get
! any interest at all.
"But it's only of late I've been re-
ceivipg this multitude of circulars from
! bond dealers in the East Offering nlu-
nicipal and county bonds in great
quantities and at low rates. Why is
it? For no reason, so far as 1 can see,
except that the brokers find them
selves suddenly loaded up with a lot of
bonds for which there was formerly
ready sale. And there's no reason for
this sudden stoppage of the demand
for such bonds except that the small
investors who buy these issues have
decided to wait for the prospective
popular loan to be issued by the ma
! tional government. Yes, I believe that
the forthcoming loan will be subscribed
several times over, and, as I said this
morning to a friend, 1 thing that the
man who subscribes for 100000 worth
will be lucky if he can secure half that
amount. This loan ought to be a GOOD
thing for the nation. Everybody that
holds one of these bonds has just that
amount of additional reason for up
holding the stability Of the general gov
eminent and for contributing to its
prosperity. France has fioated i'm
mense popular loans, and she has re-
allied a vast benefit from doing so,
both in political and a commercial
sense She has been q most prosperous
tributed prosperity than perhaps any
! other European country.
IT don't agree with the people that
think this loan will injure business by
taking $100, 100000 out Of circulation and
so contract the currency. On the con-
trary, the loan is very likely to initiate
! the currency to a moderate extent.
National banks that buy the bonds
will be in a position to use their pur-
chases as a basis for issuing more
bank notes. They would have bought
United States bonds for this purpose
before had the conditions been equally
| favorable. On whatever amount they
secure they can, under the law, issue
| bank notes to the extent Of 80 per cent.
Certainly, Wall street did not seem
| to accept very favorably today the an
nouncement made by Secretary Car
Isle. But the chief objection down
there is not the general nature of the
issue, but the fact that the loan Will
not be actually made for more than
three weeks. What the people on the
! street wanted was some measure 10
take effect Immediately. They fear that
before the new bonds are sold so much
| gold NAV be sent abroad that the treas
ury reserve will be dangerously deple-
| ted"
A FOOLISH MOVE.
|
/ Union bank, did not look gratified when
asked his opinion of the new loan.
81 think it's avery foolish. moXe-yery
| foolish indeed What do they want to
take all the money out of the country
for with that miserable scheme OF
popular loan? Business isn't any too
good now. and there isn't any too much
money in circulation. But either this
scheme will prove a fiat failure and so
cause unlimited trouble, or 1T will in
| duce people to take their savings OUT
Of the savings banks and the CONNER
ciaI banks and out of various channels
where it is in circulation, eklng out the
business of the country, and put 1t away
in bonds for the benefit of the national
treasury. It is nothing more than a
| contraction Of the currency to the eX-
tent of 500, 100000.
"What they ought to do is to float the
| loan abroad, as was done before. NO
matter whether 1t was manipulated py
| a New York syndicate or not, the money
ought to have been secured abroad, SO
! as to bring more money into this coun-
try instead of taking more out You
can see what the Wall street financiers
! think of the scheme. AS soon as the
details were announced today the whole
stock list went off and there was almost
a panic. Why, even if the scheme
should eventually prove good one, no
| DOOy can tell WileliGI II VIII VI iiOI Ioi
almost a month. Not a bond will be
issued until the first part Of February.
Meanwhile, everything is uncertainty,
and gold is liable to be exported in vast
quantities. I tell you, it was d fool
ish scheme"
"Well, it's different over in France.
There the people are used to popular
loans. They've been in the habit of
putting their savings into government
bonds and not into savings banks and
business, so that the floating of new
government loan by popular subscrip-
ton doesn't take anything from the
bank deposits, or from the circulating
pedium of general business"
OTHER OPINIONS.
President D. A. Montfort, of the Sec
ond National bank, while approving of
this method of maintaining the govern
ment reserve, did not think that the
proposed issue offered the best facilities
for those who might be inclined to in
vest in the bonds. The opportunity for
obtaining the bonds would prevent
small investors from buying. During
the war, when the government offered
its bonds for sale in each city where
there was no subtreasury, there was a
| bank at which the bonds could be pur-
chased. People who would invest, that
is, the small investor, Mr.. Montfort
thinks would be more apt to do so if he
could go into some place in his own
town and buy what he wanted. In this
case they are required to send in sealed
proposals, and people do not know what
they are going to cost
"It does not seem to me-" said Mr..
Montfort that the character of the
issue will make it popular with small
investors. I think a bond could be put
on the market that would enable the gov