The Nelson Evening Mail. THURSDAY, JUNE 24, 1880.

Nelson Evening Mail, Volume XV, Issue 150, 24 June 1880, Page 2

The Nelson Evening Mail. THURSDAY, JUNE 24, 1880.

The papers relating to the negotiation of the five million loan hate been laid on the table of the House, and they very plainly show two things; first, that the negotiations were within an ace of proving a complete failure, and second, that had they not been successful the repudiation by the colony of its debts, and consequently the utter ruin ot its credit, must have followed. On the Hfch October last, Sir Julius Yogel hating been instructed that a new Loan Act had been passed, and having received authority together with the other loan agents to proceed to raise five millions, wired as follows: — " Market very diinclined for large New Zealand, loan. You must be content half negotiated now, other half not before end 1880." On the 17th Mr Hall replied, " Could you not raise three millions now ? Considerable liabilities already incurred" Ou the 21at Sir Julius telegraphed that he would try to comply with the wishes of the Government, but that they must immediately wire their permission to the agents to pledge them not to issue more than three millions under the Loin Act of 1879, and not more than five millions under that or any other Act, until after the end of 1882. This was done, accompanied by instructions not to use the guarantee unless absolutely necessary. For a time the telegrams cease, but on the 10th November the cable correspondence is reopened by the following questions from Mr Hall, who was ' evidently beginning to get nervous : — " What steps taking respecting loan ? " Two or three more messages from the Premier follow one another in rapid succession, and the correspondence begins to assume quite a dramatic interest which culminates in the following despairing message flashed from Wellington to London on the 24th November:— " Strictly confidential. Failure raise loan would cause serious difficulties. This for your guidance respecting price." Still the agents preserve a most distressing silence until on the 2nd December there is received in Wellington this ominous advice signed " Yogel " : "Bank of England hesitates a f .t. Refers to Bank Committee. Give answer Wednesday. We urge agreement 1875 give 3us claim. Think answer favorable." Four days later, and the first gleam of light shines upon the despairing Ministers. It comes in the form of the following telegram from the Loan Ageuta :— -"Bank of England agree to invite subscriptions loau. Reluctant to do so, but consider after ngreement 1875 could not consistently decline. They, in common with general opinion, ttiiuk New Zealand loanß excessive. Advertisement appears to-night." Later in the Bnme day the light grows brighter and brighter, and the heart of the Colonial Treasurer is gladdened by the receipt of the most hopeful message that has crossed the ocean to him for many weeks. It runs thus : — " Bank of England agrees callteuders, because having made agreement '75 cannot refuse. If Bank refused, most disastrous. Agreement therefore, of infinite value to colony. Launch whole five millions uext week. Anticipate great success." Six days later every cloud is dispersed, and a flood of sunshine and gladness ia let into the room where the harassed Ministers are seated, by the telegraph boy who is the bearer of the good tidings that " Loan subscribed twice over. List closed. We congratulate you." What could the Premier do but reply without loss of time, " Government much gratified by telegram, and appreciates judgment and care displayed by you" ? From the foregoing it will be seen how narrow was the escape of the colony from utter ruin. More details are supplied in the letters which are also published, from which we make one or two extracts. On the 6th November, Sir Penrose Julyan wrote on behalf of himself and bis co-agents : — " It is right that you should be informed that a strong feeling pervades the market with regard to your loans. A belief is commonly entertained that New Zealand is rapidly incurring liabilities beyond those which her population and circumstances fairly warrant; and, notwithstanding the cheapness and superabundance of money, there is a decided disinclination on the part of bankers to make advances to any considerable extent, in anticipation of the forthcoming loan. An idea prevails, moreover, that this loan has already been largely discounted with the Bank of New Zealand, and this feeling is strengthened by a telegram from the colony, which has appeared in the London papers, announcing the intended termination by the Bank of its connection with the Government. When the new loan comes to be offered to the public by advertisement, if the Press of this country should unfavorably criticise the financial condition of the colouy, the chance of its being successfully floated will, bankers say, be greatly diminished, if not altogether extinguished, and, although we do not indorse this gloomy view of the situation, we are bound to add, that the Bank of England, in refusing us further accommodation on any terms whatever, has been influenced by these considerations, and we cannot disguise from ourselves the fact that the present aspect of affairs is by no means assuring." On the 19th December, a week after the floating of the loan, the Agents wrote, giving particulars of the operation, and in the course of their letter they- state : — " We abstained from giving the guarantee against additional loans until two or three days after the advertisement was issued, when we found that the market demanded such a guarantee, some of the largest operators having determined to give no assistance without it. The guarantee was given by a paragraph furnished to the newspapers, of which we enclose copy. Its effect was beneficial, and on the first day the applicatiopa were sufficiently large and numerous to decide the Bank to close the list after business hours. About twelve millions in all were applied for. You must not, however, conclude that there was a demand for so large an amount. During the day, it became known that the applications would

be large, and on the supposition that less would be allotted than applied for, people wrote for more than they required. We heartily congratulate you on the successful negotiation of the loan. This success could scarcely have occasioned more pleasure to the Government than it did to us : for, individually as well as collectively, we may say we have never been engaged in any transaction that entailed upon us so much anxiety and care as the negotiation of this loan. It is due to the Bauk of England, and to the Crown Agents' department, to acknowledge the assistance we received from them, which largely contributed to the success of our operationf." There is a good deal more of interest in the paper before us, but the Bpace at our disposal will not allow of further comments to-day.