gration is very rapid, and there is great activity in the development of resources, a rate of interest of twenty per cent. per annum can be paid, profitably, in many undertakings. Still, this is no criterion of what ought to be allowed, for the use of capital, but only demonstrates the fact, that we actually need more, and could use it to advantage.
The question now arises, in what way can foreign capitalists safely invest their money here, and derive the benefits of its superior value and productiveness, in our new and growing country? We reply: First, in our state stocks, issued by the individual sovereign states of the Union, redeemable at some future period, at a fair rate of interest, the proceeds of the sale of which are almost uniformly devoted to making internal improvements, and thereby strengthening the security of the holder, by increasing the ability of the debtor to pay, when the securities become due. It is not like lending money on Spanish bonds, to be thrown away in civil wars, which devastate the country, and make the money itself an instrument of diminishing the ability of the people to pay when called upon; nor is it even like lending money to Great Britain to discharge old debts, which hang like an incubus upon the nation, and which, whenever a failure of the crops creates an agitation about the corn laws, are threatened to be cancelled by a general revolution. The state of New-York has incurred a debt of some magnitude, for money expended in internal improvements, the income of which is sufficient to pay the interest, and form a sinking fund, adequate, in a few years, to extinguish the principal. The people not only can afford to pay this income, for the facilities of transporting produce and merchandise, but the prices of their produce, where it is raised, has been so much increased, as to refund to them, in this way, several times the cost of all their public works. The same may be said of the other states, though perhaps the result elsewhere has been hardly as favorable as in New-York. What, then, can be more secure, than an investment in loans, funded in this manner, for which public faith is pledged, and by which resources are developed to repay the debt four fold?
Another safe method of investment for foreign capitalists, is in the stocks, or bonds and certificates, of our trust and loan companies. The capital introduced by the sale of our state stocks, is expended chiefly in public improvements, and affords no direct facility to individual enterprise. Foreign capitalists cannot, for several reasons, loan directly upon mortgage of real estate: it is enough to state two difficulties: first, they cannot receive title on a foreclosure; and secondly, they could not, at such a distance, conveniently or safely manage the investment. Our trust companies step in between the borrower and the lender, in a measure as trustees for both, and for a commission of the difference between a liberal interest to the lender, and legal interest from the borrower, they obviate all the difficulties of the former, which would spring from a direct loan, and furnish the latter with means, on easy terms, for developing the resources of his property. The capitalist feels assured, when he receives one of these bonds, or certificates, that it is the representative of a specific mortgage security on real estate, of an unquestionable value, hypothecated upon its issue, and binding also the whole original capital stock of the company; an ample residuary fund against contin-
