Friday, September 10, 2010

1913 Chinese Reorganization Bonds

Imperial Chinese Government Hukuang Railways bonds are well-nigh ubiquitous in the marketplace. They were issued in 1911 by a consortium of banks in London, Berlin, Paris and New York, with serial numbers running into the six digits, of which hundreds if not thousands appear to have survived. A few bear New York State adhesive revenue stamps; shown here is a New York issue £100 bond with Secured Debt $1 and Investments $1 stamps paying New York’s Investments tax in 1917 and 1918; this secured for the bondholder exemption from that state’s onerous personal property tax.

In an effort to rebuild China's financial structure, the Chinese government issued bonds in four major world currencies: French, Russian, German and British (francs, rubles, marks and pound-sterling). The 1913 Chinese bonds were risky. They were issued only two years after centuries of rule by Chinese dynasties ended when a group of rebel warlords seized power.

The new government, in turn, succumbed to the Chinese communists led by Mao Zedong in the late 1940s.

China, 1913, Blue-Red. £100 5% Reorganization Gold Loan Bond, German Bank Issued. Uncancelled. 42-43 Coupons. Many coupons. Coupon bonds of this era are generally large and spectacular—American bonds typically measure about 10 by 15 inches—but this one sets new standards on both scores. Important to stress that these bonds have been bought up in recent years and pretty much taken off the market. As a result prices have risen rather dramatically. Excellent Condition!!! Price upon request.

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