The Birmingham age-herald., 1915-09-24

cessful and was so prominently associated
 with a great and new undertaking that it
 was speedily followed, as opportunities of
 fered, by other underwriting syndicates. Some of these were very successful, some of the syndicates were compelled to carry for long time the securities which they had underwritten. In the last months of President Clevelands second admins
 tration, syndicate was speedily-in facr, within a few days-organized for the pur- pose of replenishing the exhausted gold supply in the federal treasury. The late J. P. Morgan organized the syndicate and with him August Belmont was associated. The syndicate was paid in government
 bonds for the gold it furnished at what appeared to be a nominal premium price. The bonds appreciated rapidly and this led to criticism that the syndicate had taken advantage of the necessities of the federal government.
 The fact was however, that MT. Nor gan, speaking for the syndicate, gave his pledge to President Cleveland and to the Secretary of the Treasury, John G. Car lisle. that the syndicate would protect the gold in the treasury for six months, and In order to insure the syndicate against loss the bonds were issued to 1t at a price less than that which bonds were sure to command in the market. The ap- precis tion in the market price of these bonds made it possible for the syndi- cate to prevent without loss to itself the withdrawal of gold from the federal treas- ury. s at.
 Last fall, at a time of dire emergency, two underwriting syndicates were organ ized. one of which was exclusively local and the other nationwide. New York city would have been compelled unless aid was secured to default payment on account of short-time notes held in London for the
 reason that the city could not obtain for eign exchange with which to take up these bonds. Within few hours J. P. l Morgan perfected an exclusively local lsyndicate whose membership consisted of substantially all the banks of New York l city. This syndicate underwrote certain securities issued by New York city and advanced approximately y1Oo, ,000O 900 in gold upon them, and then sent this gold to Ottawa, Canada that city representing. as 1 fiscal agent, the Bank of England. That single transaction served greatly to | strengthen the credit of the United States
 in England, and as it was followed within two or three weeks by the achievement lof an underwriting syndicate. composed of almost all the national banks in the United States which furnished $100, 900. .OO( m gold whereby Americans who owed
 money on current account in London
 would be able to make settlement, as they
 did. then the credit of the United States was absolutely and perfectly established
 and there began the first of the move
 ments this way which at last eliminated 1 m the organization of the all-American syndicate which will underwrite the Eng | lish-French loan. The common impress sion in the financial district seems to be that the syndicate will not be compelled 1 to carry the loan very long, for it is like | ly to become popular investment. Ever ! Ii some part of 1t should necessarily be
 carried by the syndicate it will not be em. barrassing for the syndicate to do that since the interest upon the loan repre- sents as good a return upon capital as
 the banks in the United States can hope
 to receive.