The Jasper weekly courier. [volume] (Jasper, Ind.) 1858-1922, 1899-12-15
BOND MANIPULATION.
Hsu the Admiuisfratton Shapes
Things To Help DOT speco-
Iators.

For the first time in ten years the gov
eminent is about 10 reduce its bonded
debt. That is gratifying. Of course, but
the circumstances under which the
operafiou il TO be performed do not
speak very forcibly for the intelligence
Of our financial policy. however elo-
quently they may tell Of the astuteness
Of the individuals who profit by H.
The secretary OF the treasury has Of
fered 10 buy bonds 10 the amount OF
25.OOU. 900 TO ease the money market
He proposes to pay 1875 for four. per
g, nts. OF 1907, or III for five per cents. OF
1904. That would release from S27,75o,-
600 10 SIS. 500. II the bondholders
should avail themselves Of the offer TO
its fullest extent.
| Looking at the matter merely with
reference TO the present point OF time'
the secrctary's proposition is ahyan-
tagcous 70 the government The money
is living idle il the treasury. and by
using it in this way We shall save about
$1,000. 900 q year in interest
But how does that money happen 10
be in the treasury. tits there because
this administration and lis predecessors
issued bonds for it, The four per cents.
for which Secretary Gage IS now offer
ling 1927. were originally issued al par.
That Is 10 say. the government proposes
TO pay back sl.12s..50 for every Sl'o0o.-
COO il received. after having already PAID
Sss0.O0O in interest.
On some Of the other loans the show
ing is even worse. Four years ago fres-
iEeut Cleveland sold S62 .3l5.4O0 Of four
per cents. OF 1925 to the Morgan-Bel'
mont syndicate al a fraction over lO4
II the government should try 10 buy
back any OF those bonds to-day IL would
. have TO pay 1909 1t is rot enough ioi
the government 10 buy or sell bonds
r whenever IL suits the convenience OF Mr.
Morgan and the interests he represents
] it must also buy dear and sell cheap
, Suppose instead OF this clumsy bono
r arrangement we had postal savings
bank with 81 900 100000 of deposits
Then. il the government had NOR
: money on hand than il needed. ant
: wanted TO get some of il into circula
q ton. All ii would have TO do would be +
y reduce the rate OF interest. As the in
e ,erest went down the deposits woul
e flow out. When the process had gone o
e long enough il could be checked by SIN
: ply fixing the rate Of interest at tn
( point at which deposits equaled viii
drawals-
i Or suppose we had the interct nver
D. ible bond system. There would be Il
Il premiums then and no losses to the co
n eminent on purchases and sales
y bonds. When money became so scare
h: that il was worth more than the Nv
rs Der cent. paid by the government 4
0r holders of bonds would simply tai
81 them TO the treasury and receive not
v al par. When they had no further U
Ill for the notes they would take them
the treasury and get bonds Thus q
81 money market would always be cas-
.ir and the government would never
er forced to chatter for its own securiti'
'el The $1,000. O4s, $50 OF bonds we b
s. outstanding when Secretary Gage ma
~ his offer cost Us s40.54s .s76-s0 a year
an interest. Under the other arrangeme
ng the annual interest charge would
'le less thar Sai.c00.c09 at the outside. a.
'ie might run Gown 20 nothing. II the
Sc mand for currency we're sufficient.
'er What does the democratic party thi
ne Of currency reform as one of the issu
pr Of next years campaign ~ \. Jo'
I'm ~~T