Under laws now in force, there is no coin issued or issuable in
which the principal of the four per cent. bonds is redeemable, or
the interest payable, except the gold coins of the United States
of the standard value fixed by laws in force on the 14th of July,
1870, when the bonds were authorized.

"The government exacts, in exchange for these bonds, payment at
par in such gold coin, and it is not to be anticipated that any
future legislation of Congress, or any action of any department of
the government, would sanction or tolerate the redemption of the
principal of these bonds, or the payment of the interest thereon,
in coin, of less value than the coin authorized by law at the time
of the issue of the bonds, being the coin exacted by the government
in exchange for the same.

"The essential element of _good faith_, in preserving the equality
in value between the coinage in which the government receives and
that in which it pays these bonds, will be sacredly observed by
the government and the people of the United States, whatever may
be the system of coinage which the general policy of the nation
may at any time adopt.

"This principle is impressed upon the text of the law of July 14,
1870, under which the four per cent. bonds are issued, and requires,
in the opinion of the executive department of the government, the
redemption of these bonds and the payment of their interest in coin
of equal value with that which the government receives from its
issue.

"Very respectfully,
"John Sherman, Secretary.
"Francis O. French, Esq., 94 Broadway, New York."

The subscriptions were taken in every part of the United States,
and within thirty days $67,600,000 were taken in this country and
$10,200,000 in Europe, making $77,800,000 sold. This sum, when
applied to the payment of the six per cent. bonds, made an annual
saving to the people of the United States of $1,556,000. Since
the 1st of March, 1877, there had been sold under the refunding
act $135,000,000 four and a half per cent. bonds and that amount
of six per cent. bonds was paid off and canceled, thus saving to
the people of the United States $2,025,000 in coin each year. The
aggregate reduction of interest by both classes of bonds from the
1st of March to the close of the popular loan, was $3,581,000 a
year in coin. This was regarded as a great success.

Early in July I set out on the revenue cutter "U. S. Grant" on a
visit of inspection along the north At