Much interest centres around the successful attempt to make this a popular loan, and as this was one of the features which contributed to strengthen the credit ofthe country at this time, we may examine it somewhat in detail. Congress, after much discussion, finally provided that these 3 per cent bonds, "redeemable in coin at the pleasure of the United States after ten years from the date of their issue, and payable twenty years from that date," should "be first offered at par as a popular loan under such regulations, prescribed by the Secretary of the Treasury, as will give opportunity to the citizens of the United States to participate in the subscriptions to such loan, and in allotting such bonds the several subscriptions of individuals shall be first accepted, and the subscriptions for the lowest amounts shall be first allotted." Before the bill was finally passed, offers had been made by various banking houses to take the whole issue at a slight premium. Both Congress and the administration, however, favoured the experiment of interesting a large number of small property-owners in the loan, even at a loss to the government. It was thought that such a measure would strengthen the national credit by giving expression to the faith of our own people in the integrity of the government. Other considerations of a political character also entered in, but with them we are not concerned. As a financial measure for the strengthening and support of the public credit it proved a phenomenal success.

The bonds were issued in denominations as low as $20. Subscriptions were received through the post-office, and every bona fide subscription under $500 was immediately accepted. More than half of the entire issue was taken by 230,000 of these small subscriptions, and no subscription of more than $4,500 was accepted. In all 320,000 persons offered or made subscriptions, and the total amount tendered the government was $1,400,000,000. This rush for the new bonds was not merely a matter of patriotism or sentiment. During the progress of the subscriptions the price of the bonds advanced first to 102 and finally to 105.125|. They now stand at about 110. The lucky individuals whose subscriptions were accepted made from 3 per cent to 5 per cent in a few days. The popularity of these bonds was greatly enhanced by the standing offers obtained by Secretary Gage from two syndicates to take the entire loan or any part of it that was not covered by the popular subscriptions.

This method of floating the loan will cost the government a considerable sum of money. In the first place, a possible premium is lost. How much that premium would have been cannot be estimated because the bonds were sold in a broader market than would have otherwise existed. But it would have been at least 2 per cent, for even at a higher rate the bonds offer a favourable basis for national bank-note circulation. That is, at least $4,000,000 was lost at the beginning. Then the cost of handling the loan, paying the interest, etc., is increased considerably by the small size of the bonds and the large number of holders. It is just as much trouble to pay the 15 cent coupon of a $20 bond as it is to pay the $75 coupon of a $10,000 bond. Yet in spite of all this, the placing of the $200,000,000 loan of 1898 was one of the most successful pieces of financiering ever accomplished by the government. It demonstrated the perfect solvency of the government; it gave the country a financial prestige which went a long way toward hastening the end of the war; and it so strengthened credit of the government that, had the war unfortunately continued, it would have been able to obtain funds to almost any amount on the most favourable terms imaginable. With a 3 per cent bond selling at 105 during the actual continuance of military operations, a nation may safely regard its credit as unimpaired.

The final test of the success of the financial administration of a war is the preservation of the public credit.