So severe is now the pressure of the accumulating capital
of the world upon the means of investment, that even the Russian Fives are being converted into Fours, and it is believed that the operation will be completely successful. Italy intends to be the next in the market; and when her conversion is finished, there will be no first-class State paying more than 4 per cent. nominally for its loans. If peace continued for ten more years, and no large method of sinking money-were discovered, such, for example, as a transmutation of all fleets, national and commercial, into ships of entirely different design, in- tended to go on instead of in the water—a change not outside possibility—the regular Continental rate of borrowing would be 3 per cent., and that of England 2 per cent. The ease with, which these conversions are effected is the more remarkable because they are usually worse for the bondholder than they look. He gets his Fours at a low rate, say 90, but he gives up his promise of "amortisation." The Finance Ministers everywhere are carrying through these great undertakings in order to rid themselves of a burden which they find a mere embarrassment without reward,—viz., the annual drawings.
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