XIV HISTORICAL MEMOIR. 



the constitution when passed upon again by the present Legis 

 lature. As affecting also the value of State bonds, as well as City 

 and County bonds issued to railroads, and Railroad bonds also, 

 all are exempted from taxation by the act of March 4, 1857. 

 And, again, the Banks, under the act of 1857, are required to 

 invest ten per cent, of their paid-in capital and two per cent, 

 per annum of their nett profits in State bonds ; and moreover, 

 each Bank is required to pay for their privileges, annually, one 

 per cent, on the amount of their paid-up capital, to the State, 

 which is to go to the credit of the &quot; State Interest Fund&quot; thus 

 materially strengthening the credit of the bonds. 



In consequence of the panic in the money market, the State 

 bonds of Missouri, like many others, touched a low point in the 

 fall of 1857, and many of the holders felt much alarmed. But, as 

 was predicted by those best acquainted with the resources of 

 Missouri, the Legislature met the crisis with a determined ener 

 gy which inspired new confidence. The act of November 19, 

 1857, suspended the further issue and guarantee of bonds until 

 March 1, 1859, with some exceptions ; and among them 

 $400,000 were permitted to be issued to the Pacific Railroad 

 to finish to Round Hill, and |200,000 to carry the South-west 

 branch to Moseley s. But it was agreed that whenever State 

 bonds could be sold for 90 cents on the dollar, the Governor 

 might issue $500,000 for the South-west branch, and receive in 

 exchange the same amount of guarantied bonds, and to deposit 

 with the State Treasurer a like amount of seven per cent. Rail 

 road mortgage bonds as collateral security ; and as the latter 

 bore seven per cent, interest and the former six, the Company 

 were required to pay the difference (one per cent.) into the 

 State Interest Fund, on the bonds so exchanged. The Pacific 

 Railroad was also required to deliver up all guarantied bonds ; 

 and a like amount of State bonds, running 20 years, and bear 

 ing six per cent, interest, were ordered to be issued and deliv 

 ered to them. It was a singular fact that while State bonds 

 sold readily, mortgage bonds, guarantied by the State, could 

 not be sold. The act also authorized a special tax of one-tenth 

 of one per cent, on the $100, to be levied upon all taxable prop 

 erty in the State, commencing in 1859, to be paid into the 

 State Interest Fund ; and also provided, that the per cent. 



