The Bond Buyer Likes Seattle’s Credit—and Its Empty Storefronts

W. H. Harris of the New York and Chicago bond house of N. W. Harris & Co., in Seattle as a guest at the Rainier Club, is accompanied by W. H. Bartol of Philadelphia, a wealthy capitalist. They are a committee of the first mortgage bondholders of the Seattle Consolidated Street Railroad. Mr. Harris has been a large investor in the bonds of this city, county and state, having purchased over $500,000 of municipal and private securities in the state, of which his banking house purchased bonds amounting to $3,000,000. He considers that confidence in Western securities is increasing and that it will be only a short time until the securities of this country will be as valuable as those of the substantial portions of the Middle states.

'I have just come through Montana,' said Mr. Harris, 'and the securities of that state are good. You see they have not legislated against capital in that state as they have down in Kansas and Nebraska. To illustrate what this means, I will tell you what I found out there. The other day Lewis and Clarke county, at Helena, sold some 6 per cent bonds at a premium. Now in Kansas and Nebraska, outside of Douglas county, in which Omaha is located, there is not a county that can sell 6 per cent bonds at a premium. It makes a difference. But Montana, like the whole Western country, is in very good shape. Bonds are not selling for as high a figure as they were in 1893, but prices are better than they were a year ago.'

Asked whether the people of the East were recovering from the depression consequent upon the scarcity of money and the recent panic, Mr. Harris replied: 'Oh, yes, they are getting along better now, but the return of activity will come slowly. You cannot recover from the shock in a few weeks or a few days; it will take several years to get back to where we were. But times are improving in certain directions and getting no worse in others, so altogether it can be said that money is getting easier.'

Mr. Harris said that he was out here five years ago and was then impressed with the belief that Seattle was destined to be a prosperous city, and his visit at this time has only strengthened his belief in the future of Seattle as well as the whole Western country. Said he: 'I was agreeably surprised to notice the small number of vacant houses and stores here. Why, for the same number pro rata Seattle has a smaller number of vacant houses and store buildings than Chicago, St. Paul, Minneapolis, Kansas City, Omaha or Sioux City. The people here appear to have confidence in the future of Seattle and in themselves, and money will be freer in time.'

Speaking of the business of buying bonds and public securities, Mr. Harris said: 'You know we are in the government bond business, municipal and county securities; that is our line. What we are after is the principal and interest. We don't want to take in street railroads, for that would be branching out too much to suit us. When we find out that the people have been unfortunate and cannot meet their obligations, it has been our policy to give them grace and allow every opportunity for them to untangle their affairs and settle. Our policy in hard times has been of just such a nature, and in good times we have profited by it, for our business has increased. We always hesitate to gobble up securities for non-payment of obligations, even though we know that it will mean money in our pockets, for, as I said, we only want the principal and interest, and if we can arrange it so we can get this, it is all we desire.'

'I am very favorably impressed with the manner in which the finances of this city are controlled and managed. Your city comptroller, Mr. Parry, knows his business thoroughly and is the right man in the right place. I know of no city where the finances are looked after with as much interest and spirit. I think, however, that you will have trouble with your tax law. You know the rate of interest was 15 per cent and the penalty 5 per cent. You did right in cutting down the interest to 7 per cent, but cutting down the penalty to 2 per cent I think was a grave mistake, for that is less than the banks would lend money for. It would be cheaper for a man to borrow money from the county in this way than from the banks, so he can let his taxes go and save money on the deal. I am afraid that when the time comes the cities and counties in the state will find that they have not enough money on hand to pay the interest on their debt. The policy of dividing the collection of city and county taxes was all right, but the penalty should not have been reduced below 5 per cent, as that would have insured payment.'