Evening journal., 1912-08-09
NEW NEWS OF YESTERDAY
The Financing That EStab-
IiShed a New Record
BY Holland

"Thsre is no doubt that John Sher-
man well deserves the high reputa-
ton which he gained while serving
as Secretary of the Treasury in the
administration Of President Hayes
said the late Frederick d. Tappan,
for many years one of the most pro-
minent and influential Of the bankers
of New York, in 1899. three years be-
fore his death.
If Sherman had done nothing else
the manner in which he brought
about the resuption OF specie pay
ment by the government on the first
of January, 1879, would justify plac-
ing him in the list Of the greatest
financiers this government has ever
had in it's service. Secretary Sher-
man was able to resume specie pay
ment without causing the slightest
! ripple In the banking and financial
world.
But sometimes think" continued
Mr. Tappen, that Charles Foster of
Ohio, Secretary of the Treasury in
the last two years of the administra-
ton OF President Benjamin Harrison,
deserves to be placed in the list of
really great Secretaries of the
] Treasury.
Shortly after Governor Foster be-
came Secretary of the Treasury in
the early winter of 1891 he .old me
that he was giving every moment he
could spare from his official duties
to the consideration of very import
ant matter which he would have to
decide before September
You doubtless know. Mr. Tap
pan, he said to me. that in Septem-
Der there are about fifth millions Of
government bonds, bearing four and
one half per cent interest, which will
either have to be paid or else refund
ed Now, ! am satisfied that we could
easily refund them or extend them
at three per cent ] have talked to
the president about this matter and
he has told me to use my own dis
cretion
II have about made up my mind
that I will try to do what no govern
ment in modern history, so far as |
know, has ever attempted: am
strongly disposed to offer to extend
these bonds for a term of years pro-
vided the holders of them will accept
interest at the rate of two per cent
81 must confess" said Mr.. Tappan,
that my first impression was that
Governor Foster would be compelled
to abandon his purpose. II seemed
almost preposterous. No government
had ever foated a security, so far as
! know, bearing two per cent inter-
est English consols, the highest
governmental security in the world.
we're at that time bearing two and
one half per cent. interest and selling
below par.
Il said to Governor Foster that he
| did not, of course, want to make a
failure Of the plan.
oh, no. he replied. I shall not
fail. am going to say to the holders
| Of the bonds that II they will accent
two per cent interest I will extend
them, but if they won't accept two
per cent interest I viii take them up
in cash. ] have been figuring on this
little and I am satisfied that I can
extend at least thirty millions of the
bonds at two per cent; the balance
OF the issue I will redeem at face
value
WE'LL Governor 7 replied. II is
worth trying. If you succeed. you
will accomplish what no other
governmental fnancier has ever
done
We'll, he did succeed. He actual
" extended about twenty-six mil
lions Of the bonds at a rate of inter
est of two per cent. and he redeemed
the entire balance of the issue intact
! II was the first time in all history
that government had possessed
such high credit. and think Cover.
nor Fosters name should go down
into history as the man who first
marketed a government bond bear
ing interest at the rate of two per
cent
tCopyright 1912. by f. ]. Edwards
All rights reserved.)
Tomorrow Mr. Edwards will tell nj
The Campaign Nickname Tbal
Proved Boomerang to its Maker .