The Sun.
London, England, 1836-06-17 00:00:00

BANKING AFF

Great interest seems to be rai-_,,ra in the city by the discus-
sions on American affairs,.bv: many affect to doubt whether
trading and banking have 'seen carried to the extent described,
and ask for further evidence on the subject. We cannot in
such a case refer to better authority than the speech of Mr.
Cambreleng, of New York, who, in a speech delivered in the
House of Repres':;ntatives on the 27th of April, in a Commit-
tee of the on the state of the Union, entered very
largely into these matters. He dates the beginning of this
expansion from about 1830. Mr. Cambreleng says—
" Thr.: exports of domestic produce, the permanent regula-
tor of -our revenue from customs, and generally of the receipts
from public lands, amounted in 1828 to 50,000,000 dollars ;
they increased, and in 1835 reached 98,500,000 dollars. For
Ifive years the increase was steady, rising in that term from
.50,000,000 dollars to 70,000,000 dollars in 1833; but be-
tween 1833 and 1835 they suddenly rose to 98,500,000 dollars
—in other words, at the rate of 5,000,000 dollars annually in
the first four years ; 11,000,000 dollars in 1834, and
17,500,000 in 1835. Your importations for consumption,
I mean after deducting the amount exported, were, in 1830,
at 49,000,000 d'Alars. It is proper to state that Ido not
refer to the 'statements reported from the Treasury, as
they include specie among the merchandize consumed
in the
Lry, which I have excluded in my calcula-
tions. the amount of merchandise imported for consump-
tion rrise from 49,000,000 dollars in 1830 (10,000,000 dollars
beirJw the export of domestic produce in that year) to
87 ,000,000 dollars in 1834, and in 1835 suddenly to 122,000,000
''collars, being 23,500,000 dollars beyond the exports of do-
mestic produce. The revenue of the first quarter of 1835
was not very large, but judging from the importations in the
remainder of the year, and the extraordinary revenue at the
port of New York for the first quarter of the present year,
there can be no doubt of an importation for consumption in the
year ending the Ist of April of from 35,000,000 to 50,000,000
dollars beyond the exports of domestic produce. The receipts
from public lands were, in 1828, about 1,000,000 dollars ; they
rose gradually from 4,850,000 in 1834, and then suddenly to
14,750,000 in 1835.

" Such, Sir' are the evidences of sudden and extraordinary
overtrading. These seasons of speculation are incidental to
our rapidly growing country, and withwat any other cause, after
20 years of peace, it was natural tr., expect that, enjoying as
we do, unparalleled prosperity, arid outstripping all other na-
tions in the growth of wealth and population, we should be,
as we now are, hurried on by a wild and uncalculating spirit of
speculation. But other camies have accelerated speculation,
and a sudden expansion of credit, within the last two years.
The severe lessons v;e., received between 1818 and 1820,
from overbanking and .overtrading, arrested for a time
the increase or, banking capital ; and, in the ten
years from FAO to 1830, the increase was only about
15,000,000 dollars, while from 1830 to the present time it has
been su'V..enly augmented more than 100,000,000 dollars.
0 win% 'to this cause, and the solid prosperity of the country,
there was a strong tendency to overtrading, when the Bank
of the United States commenced curtailing in 1833, and in 19
rasanths reduced its loans and exchanges nearly 19,000,000 of
elollars, in November, 1834. This reduction had its effect
-upon the banks and trade of the country. But the moment
the Bank changed its policy, and united with other banks, and
with trade, in expanding business and credit, the spirit of spe-
culation suddenly spread throughout the Union. Between
November, 1834, and July, 1835, the Bank increased its is-
sues between 9,000,000 and 10,000 000 dollars, and its loans
and exchanges about 19,500,000 dollars. This affords some
idea of the vast and sudden expansion of the business of all
tbe banks in the Union, and of the increase of that immense
mass of private credit, which it is impossible to measure. One
other cause, and a powerful one it is, has added to this spirit
of speculation, and is sufficient to explain the mystery about
exchange. Our act altering the relative value of gold and
silver made the fernier, the chief currency of Europe, more
valuable here thaui it is there—we suddenly became purchasers
after being so -many years vendors of gold, and the effect of
that act was to substitute gold in the place of silver, as our
currency."
Fronk such statements, and they arc not, that we are aware,
capable of contradiction, it is impossible to come to any other
conclusion than that the whole of th',: trading and monetary
interest of the Union are in an artificial and highly excited
state, which requires to be made known and carefully watched
in this country. It is not meant to affirm that any very ex-
tensive mischief must follzw to this country from this state of
things. The very utility of our drawing attention to them con-
sists in this—that it ;nay possibly, by exciting similar caution
on the other side., avert altogether the otherwise inevitable
consequences. Mr. Cambreleng, in his speech, goes on to
draw a parallel between the state of the Union from 1816 to
1818, which preceded the great crisis of 1819, and to antici-
patt.: similar consequences now : he remarks—
" But, whatever may have been the causes of the present
condition of the country, it is an unnatural one. Prices cannot
continue to rise—the tide of trade and revenue cannot roll on
for ever. The moment it reaches its utmost point of eleva-
tion, the returning ebb will be felt in every quarter of this
Union ; and we shall feel it, sensibly feel it, in every branch
of our revenue. We have been for 18 months past as we
were from 1816 to 1818. We had a revenue from customs in
1816, of 36,000,000 dollars, which fell to 13,000,000 dollars
in 1821. Our imports were, according to the Treasury
statements, 133,000,000 dollars in 1816, and but 41,000,000
dollars in 1821. Our sales of public lands were in 1815,
2,300,000 dollars. They rose to 7,200,000 dollars in 1818,
then rose suddenly to 17,700,000 dollars in 1819, and as
suddenly fell in 1820 to 1,900,000 dollars. Such, Sir, has
been our experience ; and yet we are told we are to have no
diminution. 'Your importations may go on at the rate of
150,000,000 dollars to 200,000,000 dollars annually, but the
higher they reach, the more terrible will be the revulsion.
If between 1816 and 1821 they fell from 133,000,000 dol-
lars to 41.,000,000 dollars, where is the reduction to stop
when th e ebb follows our present flood? Will it stop at
100,00 0,000 more than double the amount in 1830, or will
it stc p at 75,000,000 dollars, far beyond the usual amount
imp orted for consumption in former years ? "
The facts in this speech, it should be remarked, were ad-
duced to show the impolicy of distributing the surplus re-
venue of the country amon the several states, on account of
the reaction that must necessarily follow them, and bring
back the income to its former level, but they are equally
applicable, and of still greater importance, to the state of
the trading and banking interest.