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to the board, a steady yearly gain in gross and net of from fifteen to twenty per cent, could be surely relied on, and this prediction was made good during the next few years. Encouraged by this prosperity, the executive department came before the board with one recommendation after another for the improvement of the track, the replacement of wooden by metal bridges, additional motive power and rolling-stock, the enlargement of terminal facilities, and the purchase and construction of new branch lines. It was but a repetition of the general experience of all Western roads developed under like conditions. A progressive spirit animated the board, and they yielded, no doubt too readily, to the arguments of the operating and engineering officers. But it was evident that a new departure in the financial policy of the company would have to be taken in order to supply the means for the proposed large new expenditures. The financiering of it had been only a desultory one, so to speak, since the creation of the first mortgage, which was expected to meet present wants but which had no reference to the future. Three separate general mortgages had already been made on the main line, and there existed three other mortgages on parts of it, besides nearly a dozen special ones on branch lines. Mr. Villard devoted himself to the problem of devising a financial scheme comprehensive enough to provide not only for the current requirements, but also for the gradual absorption of all the securities issued under existing liens into one form of indebtedness. A general mortgage large enough for both purposes seemed to him to offer the only practicable solution, and was finally decided upon. The details were worked out by himself together with the finance and executive committees, and the project was then placed in the hands of the several counsel of the company. Several of the legal questions involved were very intricate, and the lawyers spent many months in solving them. The plan was considered at several meetings of the board and definitively approved on August 21, 1889. It authorized the