The Times has fallen into a singular mistake about American
finance. In its first leader of Wednesday, it states that "by far the greater part of the American Debt is in terminable annuities," and that "the interest is not only interest, it is also repayment of capital, and while it is paid the debt is being paid too," and that the debt is not unlikely to expire of itself "in a few years." All that is quite a delusion. The Americans did not raise their money by terminable annuities. They inserted a clause in their contracts authorizing Government to repay the loans after twenty years, but a clause enabling the mortgagee to pay off a mortgage does not pay it off without cash. The Indian Government always inserts the same clause, in order to protect holders, should the stock rise, from being paid off suddenly at par.
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