The Barre daily times. (Barre, Vt.) 1897-1959, 1908-07-02
WAR BONDS
TO STAY OUT.
Probable Plan Of Treasury.
Department
--------
ON AUG.l, IS REDEEMABLE
The Conditions Are Not Favorable for
the Refund--No Issue SO Widely
Distributed Among the
People.
ON AUG.l, 3'SREDEEMABLE

Washington, July 2.--Secretary Cor
telyou of the treasury department has
had before him for months the question
of what to do with the three per cent.
bonds which become redeemable Aug.
|, ard which, under the law, he may
redeem any time between Aug. !, 1908,
and Aug. l, 1918. 1t has been generally
supposed he would either pay off these
bonds or would refund them into two per
cents. Recently, however, the impress
sion has become strong that he will do
nothing with them at this time, but will
simply avail himself of the discretion al
lowed him under the law and let them
remain out until there are more suitable
conditions either for redemption or for
refunding.
The bonds in question are the remnant
Of the Spanish war loan OF the summer
OF 1898. The total outstanding amounts
to S63,045,460. OF this total S40,2l3,540
lis in registered bonds and the remainder
in coupon bonds. About Sl7 100000 OF
the bonds is held by national banks as
security for circulation or for public
deposits. The treasury is not advised OF
the whereabouts Of the coupon bonds,
for it keeps no record of the holders OF
them.
Treasury officials say that this loan
is the most widely distributed OF any OF
the government bond issues The extent
to which il is scattered around among
small holders Is remarkable. The gov
eminent issued about Sl99,000,000 bonds
in this Spanish war loan 1t was the
summer OF 1898 and patriotism was run.
ming high. Many persons subscribed for
bonds in amounts between $40 and $500,
and these small amounts were distribut-
ed to every state in the Union. The
treasury department purposely kept out
the big bidders and corporations to a
large extent and the bonds went into
the hands OF thousands OF small pur-
chasers. The treasury department sent
out 100000 packages OF these bonds by
express to every quarter of the United
States. This indicates the fact that
they were widely distributed. OF course,
as but about third of the bonds are
outstanding as threes, many of them
are out OF the hands of the original
holders, but those that are outstanding
are still widely distributed in small
amounts.
This is one of the phases of the situa-
ton that makes it rather difficult for
the secretary of the treasury to act.
Most small holders will be loath to give
up their three per cents. Even if the
interest on them is stopped and Mr.. Cor
telyou gives notice that he will redeem
TENN at a given date, it will probably
take long time to get them all into
the treasury and paid up. The average
small bondholder does not like to part
with bond and leave his money lying
around uninvested until he knows what
to do with it. In June last year the
treasury redeemed the fours Of 1907,
but there are still many OF these bonds
outstanding. 1t will probably be years
before they are all paid. Similarly the
process Of refunding would probably be
a slow one.
Redemption of the bonds at this time.
with the treasury showing large deficit,
is considered out Of the qeustion. Re-
funding teh bonds into two per cents.
would be feasible, but il is considered
that it could be accomplished better at
some other time, and ON the whole Mr..
Cortelyou is expected to conclude it will
be wiser to let the bonds run along for
a while. Treasury officials do not think
that this would seriously affect the price
OF the bonds in question. After these
bonds are disposed of, it will be long
time before the treasury has any big
bond issues to redeem or refund. A
small Philippine bond issue will be re-
deemabIe in 1915. The fours of 1925,
Slls.nmable in that year, amount to over
100000 ofaQ. In 1890 there will be s646,.
able. The total outsraA hlsRqnds Tedee8sI
The United States amount to sseT 900. 4
700 in round numbers.