"savings banks" were passed in 1817 in England. (See also "Mutual Savings Bank.") Savings Bank Account, How to Open. See "How to Open a Savings Bank Account." Savings Bank Bonds. As this term is used among financiers, bonds which certain Eastern States that have passed the most conservative legislation in relation to bonds in which the savings banks therein may invest, as New York and Massachusetts, are commonly understood. The term may, however, be used to refer to bonds which the savings banks of any State may buy provided that State has passed any restrictive legislation whatsoever in relation thereto. Savings Banks with Capital Stock. "Mutual Savings Bank." Explained under Savings Institution. See "Savings Bank." SB. The "ticker" abbreviation for "small bonds." Scaled. When a corporation or municipality is unable to meet the principal of, or interest on, a debt, and is able to arrange a continuation of the debt at a lesser rate of interest, or an extension of the debt for a lesser principal sum, or both of the above, then the interest has been “ scaled," or "the debt scaled," or both, as the case may be. Scaled Buying or Selling. Transactions of a security made in equal amounts upon a scale of prices; for instance, a "scaled buying" of Union Pacific may be buying lots of 100 shares each as the stock advances every two points. Scalping. "Scalping points off the deal." This expression has reference to those taking advantage of what seems some hidden scheme in process of consummation, causing an advance in prices of certain securities. Although, not knowing just what the "deal" is, such persons take advantage of the rise in prices and buy and sell accordingly, making small profits. By this method, they are said to have been "scalping profits. Making a quick and small profit is "scalping." Scandinavian Union. Norway, Sweden, and Denmark have adopted the same monetary unit, viz.: a single gold standard with the krone, or crown, as the unit, which equals about 26.80 cents United States money. School District Bonds. See "Board of Education." School Savings Banks. A system adopted by many schools throughout the country to encourage saving among the pupils. The money saved by them during the week is collected by the teachers once a week at the opening of the school 1 Oct. 1, 1905, circular of the United States Mint. session, and turned over to the principal, he placing it in a savings bank in the name of each depositor. Deposits of $300 and over draw interest; no deposit of less than $3.00 can be withdrawn, except in case of sickness or removal from the city. On January 1, 1906, there were 5,293 such banks in operation. These were in 1,023 schools of 122 cities of 25 States. The amount which had been collected up to that date was $4,864,575.98, of which $3,641,015.66 had been withdrawn, leaving a balance due to 384,587 of these little depositors, on that date, of $1,223,560.32.1 Scrip. In financial transactions, a temporary paper or certificate is often issued, to be exchanged later for money or a permanent certificate, or whatever the "scrip" entitles the holder to receive. "Scrip" is frequently issued during a reorganization, or stock conversion, to represent fractions of shares of stock. When enough of these are presented to represent a whole share they may be exchanged for one. Scrip" is a name applied to a paper entitling a person to the receipt of a dividend to be paid later, but in common usage such a paper is called a "due-bill." During the Civil War, and shortly following that time, fractional paper currency was issued called "scrip." Scrip Dividend. Sometimes corporations wish to declare a dividend in some other form than cash, or declare what is known as a "stock dividend," and, to that end, may issue what substantially amount to "due-bills," carrying no voting power, but generally at some later date convertible into stock; but no dividends would be declared upon the same until conversion had taken place, although they might bear interest in the meantime. S. D. M. J. September, December, March, and June; interest or dividends payable quarterly beginning with September. Sealed Bid. When an issue of bonds is offered for sale and for which the intending buyers must submit "sealed bids," such buyers must state clearly in writing what they will pay for the bonds, in accordance with the conditions imposed by the seller. The buyer, usually, adds such conditions regarding the legality of the issue, etc., as may seem to him wise. Most issues of municipal bonds are sold in this way. The "sealed bids" must all be in by a fixed date and should properly be opened in the presence of those authorized to make the sale, and, so far as may be, at the same time. This ensures all bidders being treated alike. After opening the bids the bonds The writer is indebted to J. H. Thiry, of Long Island City, N. Y., who, above all others, is conversant with this subject. are" awarded," or sold, to the highest responsible bidder who is given a reasonable time to satisfy himself as to their being as advertised, and valid. Sometimes a deposit is required of a certain amount in cash, or its equivalent, with each bid, which is called a "forfeit." It is customary to use for this purpose a "certified check" for the amount required, and made payable, for instance, as follows: "Pay to the city of New Orleans, when accompanied by one hundred thousand dollars, par value, of legally issued bonds of the said city" describing the bonds. This prevents the use of the check by the city in case it cannot, or does not, comply with the conditions as to legality imposed by the bidder. The question of the proper wording of a "sealed bid " has been much discussed and different forms are in use, but after describing the issue, for which the bid is being submitted, the following wording may be used as a protection to the bidder. "The usual papers evidencing the legality of the issue satisfactorily to our attorneys to be furnished us prior to our taking up and paying for the bonds." It is not unusual for municipalities, in advertising for sale an issue of bonds upon which sealed bids will be received, to reserve the right to reject any or all bids. This safeguards them against the necessity of making a sale, provided no satisfactory bid is received. Seat. One who possesses membership in an "exchange would be said to possess a seat" therein. " Seat on the Stock Exchange. See "Stock Exchange Seat." Second Consolidated Mortgage Bonds. An issue secured by a mortgage subsequent to one "consolidated mortgage (refer to "Consolidated Mortgage Bond ") already covering the property, and to all other prior mortgages. It bears, roughly speaking, the same relation to all the earlier mortgages as the " consolidated mortgage "'issue does to all issues prior to that one. A bondholder of this class must consider the sum total of all prior indebtedness secured by the "first consolidated" and earlier mortgages, in order to determine what value, if any, there is left in the property to secure his investment. It must certainly rate along somewhere with a" third mortgage" and perhaps a "fourth." Yet the rapid increase in the value of the property due to good business and large improvements may warrant the debt. Second Mortgage. A mortgage placed upon property which already has another mortgage existing upon it; for instance, a certain piece of real estate supposed to be worth $10,000 has already existing upon it a mortgage for $5,000; the 'Note the spelling of this word. owner wishes to borrow $2,000 more, and finds some one who is willing to accept a "second mortgage," upon the same, for that amount, making the total mortgage indebtedness against the property $7,000. Suppose the owner of the property is unable to pay the interest, when due, on the "second mortgage; " in order for the holder of this mortgage to protect himself, he must foreclose the property under his own mortgage and pay the holder of the first mortgage his due. In taking a second mortgage" one should have reason to believe that the property will, at any time during the life of his mortgage, bring at forced sale a price sufficient to pay off both mortgages, because the first mortgage must be satisfied in full before the "second mortgage" holder receives anything. Second Mortgage Bond. A bond secured by a mortgage upon a property which already has one other mortgage existing upon it and which mortgage would have prior claim upon the property and its earnings. (See "Second Mortgage.") Second of Exchange. See "Set of Exchange." Second Preference Shares. The English equivalent of our "second preferred stock." Second Preferred Stock. See "Preferred Stock." Seconds. Second mortgage bonds. Quotations in the newspapers regarding money rates appear something like this: "The first commercial paper sells at 5%, good names sell as high as 51%, the names that are termed seconds' sell as high as 5%." Good names," of course, refers to the makers of notes, who, in this case, are rated at a high standard of credit. "Seconds," therefore, would refer to the next class of borrowers with not so good a standing. Second Teller. The "receiving teller" of a banking institution. Second United States Bank. The organization of many local banks followed the refusal to renew the charter of the First Bank of the United States, which had expired in 1811. These new banks, together with the existing war - 1812 with England, produced wild financiering and bank note inflation. As a check upon these local banks and as a means of returning to specie payments, the Second Bank of the United States was chartered by Congress, April 10, 1816. It was to run for twenty years, and was established at Philadelphia, with nineteen branches in other parts of the country. The capital was $35,000,000, to which the Government subscribed for onefifth. The charter provided for the deposit of public moneys in the bank, unless otherwise ordered by the Secretary of the Treasury. At first, the bank was not a marked success; there was more or less scandal attached to it. It went to the verge of bankruptcy as the result of the most flagrant kind of bad banking, and, instead of proving a check to the local banks in their wild careers, it excelled them in their own loose methods. Later, it became a sound and solid institution, and grew to have twenty-five branches. Twenty directors were elected each year by the stockholders, and five appointed by the President, subject to the confirmation of the Senate. During most of the bank's existence from 1823 until the charter expired-it was under the Presidency of Nicholas Biddle, who was both a Government director and an elected director, so during his management there were but twenty-four directors altogether. Trouble was precipitated by opposition to the management of the Portsmouth, N. H., branch. President Jackson grew hostile to it, probably on account of not being able to control the bank's appointments and actions politically. Jackson had collected around him a little coterie of well-known characters, other than members of his cabinet, who were referred to as his "Kitchen Cabinet," prominent among whom were Duff Green and Francis P. Blair, aided by their newspapers, Isaac Hill, of New Hampshire, and Amos Kendall, of Kentucky. As Sumner well puts it, " Andrew Jackson's power and popularity, moving now under the impulse of the passions which animate an Indian on the war-path, were the engine with which these men battered down a great financial institution." 1 An effort was made to renew the charter in 1832, and, although passed by Congress, was vetoed by Jackson. In 1833 he ordered the public moneys to be no longer deposited in the bank, but distributed among certain State banks. Jackson professed to believe, as is shown by his message of 1835, that the bank had been in opposition to the Government for four years, which proved the evil effects of such an institution. He declared the bank to belong to a system of distrust of the popular will as a regulator of political power, and to a policy which would supplant our system by a consolidated government. There had been more or less opposition to the bank throughout the country. At one time, the popular feeling was such that Kentucky and other States tried to tax the branches out of existence. The local banks naturally anticipated with pleasure the removal of their large competitor, and quite generally lent their aid to Jackson's scheme of destruction. Life of Andrew Jackson by William Graham Sumner. From this admirable volume, and John Fiske's "History of the United States,” the writer drew largely for information regarding the bank. |