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$4,999,149 of the loan was issued (Bayley, Nat. Loans, 71). On $363,900 there was an average premium of .277 of 1 per cent, while the rest went at par (De Knight, Currency, 70). Opponents of the government attributed the success of the loan to Marcy's statement that it would not be necessary to call for more volunteers. As a new call for volunteers went out almost immediately after the bids were opened, he was charged falsely with having played a trick on the public (N. Y. Express, Nov. 18, 1846). For the truth in this matter see vol.i, p. 351. Most of the loan was taken at New York, but it became fairly well distributed. Walker's offering the loan only ten days after advertising an issue of $3,000,000 in notes (Niles, Nov., 1846, p. 147) was rather alarming, it must be admitted. A less reasonable criticism on his policy was that he could and should haveborrowed liberally June 1 and July 1 at 5 per cent. At those dates he had a large surplus, the tariff had not been changed, and the administration did not expect a serious war.

14. Sen. 2; 29, 2 (Walker, report, Dec. 9, 1846). Dewey, Financial History, 255-6. U.S. Stat. at Large, ix, 118. 247King to Larkin, Nov. 7, 1847. Polk, Diary, Feb. 16. 13Pakenham, no. 13, Nov. 12, 1846. Niles, Apr. 24, 1847, p. 113; June 5, p. 224; Aug. 21, pp. 392, 400; Feb. 5, 1848, p. 354 (McLean). Wash. Union, Jan. 14; Apr. 12, 1847. N. Y. Herald (weekly), Apr. 24; Nov. 30, 1847; Feb. 26; Mar. 4, 11, 18, 1848. Bayley, Nat. Loans, 72. De Knight, Currency, 71-2. Knox, U.S. Notes, 64, 69. 108Buchanan to Bancroft, Dec. 29, 1846, priv.

The estimated deficit, July 1, 1847, was $4,779,042 (Walker, report, Dec. 9, 1846 in Sen. 2; 29, 2). By the Act of Jan. 28, 1847, the treasury notes were to be redeemable in one or two years, to bear interest (not more than 6 per cent) at the discretion of the President, and to be convertible into bonds. None could be issued, used as security for loans, or bought up by the government, at less than par plus the accrued interest. New notes could be issued for those redeemed, but the total outstanding amount of notes and bonds issued under the Act could not exceed $23,000,000. The public lands were in effect pledged as security for the loan, which was made payable at any time after Dec. 31, 1867. The Act provided that the notes to be issued under it and all previous treasury notes could be converted into 6 per cent stock (bonds).

It was predicted that the loan could not be placed at better than 90, if at all (N. Y. Express, Dec. 14, 1846). Bids (to be in by Apr. 10) for $18,000,000 of it were invited on Feb. 9, 1847. The New York and Boston banks appear to have agreed on a price, but some New York capitalists offered more, and they in turn were outbid by Corcoran and Riggs of Washington, who seem to have taken a very large part of it. The bids above par totalled about $55,000,000, and the premiums offered ran as high as 2 per cent. It has been called a mistake to pay 6 per cent on long-term bonds, and this is proved by the premium they soon commanded. But before the bonds were issued grave doubts regarding their acceptability were entertained, and a saving in interest was of relatively little importance. Many had expected that the whole amount ($23,000,000) would be issued in treasury notes and practically increase the amount of the currency; but the amount issued at first was largely taken for investments (N. Y. Herald (weekly), Mar. 20, 1847). Hence the currency in circulation was diminished. However, the specie coming from abroad soon made up for this.

Bids for $5,000,000 of notes were invited on Feb. 26. The Rothschilds