The proposal of the French Government to convert the £220,000,000
of Fives into a 41 per Cent. Debt has succeeded. The holders were hopeless of resistance, and although heavy orders to sell were sent to Paris, the fall was not serious. The Government, to soothe the market, pledged themselves against farther conversion for ten years, and on Tuesday, at midnight, the Chamber swept the Bill through by a vote of 472 to 94. The Senate followed suit by a still heavier majority. The truth is, no project of conversion now-a-days fails. The mass of Securities offered does not increase in any pro- portion to the savings of the nations, and the demand for " safe" bonds outruns the supply. The consequence, bonds being only goods, is an increase of price so great that conversion is always safe, and even Hungarian Rentes can be converted. There is now scarcely a first-class security in the European markets which pays a clear four per cent., and the soundest States can borrow at less than three. Modest investors may, however, take com- fort. If there are no great wars to make loans cheap, the Governments are entering upon a course of "social reforms" which will cost them at the outset nearly as much. There will be loans yet for social purposes on the Be Freycinet scale—he is quite equal to borrowing a National Debt in a year—to be expended, let us hope, with a little more judgment.
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