stock in the market is consequently in the same
proportion, and at the present moment is about
£62 for every £100 stock.



CHAPTER VII.
LOANS TO CORPORATIONS AND COUNTIES OF
THE UNITED KINGDOM.

THESE are loans raised by boroughs and coun-
ties, and other authorities in this country, for
local purposes, upon the security of the rates or
other assured income. Before the money is
borrowed the consent of the Local Government
Board is necessary to make the loan legal, and
evidence is required that the resources of the
borrowers are ample to meet their obligations.

On most of these stocks the rate of interest is
3 per cent., though there are some few at 3 1/2 per
cent. The principal is redeemable at fixed dates,
or by a sinking fund, that is, by setting aside so
much a year to pay off the loan at a fixed time,
or as opportunity offers. For instance, in times
when money is scarce or dear there is a proba-
bility of these stocks falling below their par
value, and the Sinking Fund is then used to buy
the stock in the market. Thus the Corporation
may be able in effect to pay off a loan of £100