"I am sure I do not over estimate the damaging effect which the passage of the bill must have upon American credit. All my letters from abroad, and conversations with people familiar with the English and continental money markets, confirm my convictions on that point. When you look back and find in the archives of your department the proud records of a nation's faith kept inviolate with a most punctilious and chivalrous spirit during a century, amidst all the trials of foreign and civil war which strained the resources of our country to the very verge of ruin, the task before you is certainly a difficult and harassing one; but while the path of duty is often narrow and difficult, it is always straight and so well defined that it can never be mistaken.
"Sound financial policy and love of our country's fair name alike demand from those to whom the administration of its affairs have been intrusted the most uncompromising hostility to the blind and dishonest frenzy which has taken hold of Congress, and I sincerely hope that you will be seconded in the task before you by the hearty support of the President and your colleagues."
On the 9th of November I was advised that the four per cent. bonds were selling at 99 and interest, in a small way only. The syndicate had bought in the market about $750,000 of these bonds at less than par in order to prevent a further depreciation. On the same day I was informed by August Belmont & Co., as follows:
"After conference and careful consideration of the whole subject, it is the conclusion of all the associates, in Europe and here, that it is injudicious to undertake further negotiations of the fours, during the pendency of the legislation proposing to make silver a full legal tender, as the discussion has checked dealings in the bonds by the public. To make a call in the face of a market quotation (to-day 98¾ and interest) below the price fixed by law would not convince the public that new business had been undertaken at a loss, but that the call was connected with business previously done.
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"Further than this, we are satisfied that, holding the views expressed in your letters mentioned, the President and all his cabinet will agree with us that it would be wrong for us to ask for another call at this juncture, as such action would be held by those advocating the legislation in favor of silver as proving that such legislation in our opinion was not prejudicial to the national credit and the refunding of our national debt."
On the 10th of November Mr. Conant wrote me that our bonds had been depressed by the rumors which had been circulated respecting probable legislation which would depreciate their value, and that four and a half per cent. bonds had fallen off three-fourths per cent. He said: "If, in any legislation which may be enacted regarding silver, provision could be made not only exempting the debt and interest thereon from payment in silver, but declaring that payment of the same shall be made in gold coin, it would aid us immeasurably in placing our bonds."
Two days later I received a letter from F. O. French, of New York, as follows:
"Our business people are very much alarmed at the rumored strength of the silver people, and, as they apprehend the gravest disasters from the success of the Bland bill, a committee of gentlemen connected with insurance and trust companies, as well as with the banks, go to Washington to-morrow to present their views to the finance committee.
"Once dispatch this silver business—and I have faith that it cannot live in the light of full discussion by the Senate—and we shall renew funding, and by attaining resumption put an end to financial discussions as we did to slavery."