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[666] advantage of this to negotiate the loan voted on the 8th of February. On the 2d of April he succeeded in disposing of three millions of the bonds at above ninety-four, but political events, such as the bombardment of Fort Sumter, threw difficulties in the way of this operation, and it was with much trouble that he managed to dispose of five millions more, half of which was taken by the principal banking-houses of the Eastern States.

Meanwhile, the call for volunteers and the breaking out of hostilities were daily increasing the expenditures of the treasury department, rendering it more and more difficult for Mr. Chase to meet them. He could find no purchasers for the fourteen millions of bonds which still remained in his hands out of the twenty-one millions voted for in June, 1860, not being authorized to sell them below par; the loan of March 2d could not be issued before the 1st of July, and he was not allowed by the law of February 8th to dispose of more than nine millions. He disposed of this last scrip on the 25th of May, for the sum of eight million six hundred and thirty-seven thousand dollars, of which six million three hundred and ninety-six thousand dollars were sold, and two million two hundred and forty-one thousand two hundred dollars converted into treasury notes at six per cent., convertible in their turn into scrip at the option of the bearer. The provisions of the law of 1860 having been complied with by an offer of the fourteen millions scrip at par-an award which naturally found no takers—the Secretary, in virtue of this same law, issued on the 30th of May an equal amount of notes at six per cent. interest, which were chiefly used in satisfying his creditors.

The position of the treasury department, therefore, was one of extreme difficulty; it was still further aggravated by the competition it had to encounter on the part of the several States, all of which were obliged to resort to borrowing in order to defray the expenses attending the procurement of volunteers or the equipment of militia, and many of which borrowed as much as two millions at a more reasonable rate of interest than was paid by the Federal government. Consequently, at the end of June, although Congress was about to assemble, Mr. Chase found himself confronted by a debt of five millions, which he could not

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