The enquirer. [volume] (Richmond, Va.) 1804-1815, 1804-08-08

competition which takes place between them.
But this corn will not on that account bear A
higher price III foreign markets, than that of any
other country becauie this very competition
will extend to foreign markets, and induce the
merchant to fell it at a i9zuey pratt than what
he formerly received. This decreafe of profit
will in this manner ferve to counteraa any in
create in its prime colt. The fame effect may
thus be gradually extended to ali the employ
ments OF capital More caoi,al will for initance
be employed in agriculture more corn will be
brought 70 market and it will confequently
command lower price. Profit will thus be-
come leis, becauie the quantity of productive
capital has become greater. The wealth of each
individual and OF the whole iociety, will in the
meantime be increaling becauie although the
profits are lower, the fun of thoCe profits will
be much greater from the greater increafe in
the quantity of productive capital.
2. Banks, it is faid, have tendency to en-
courage monopoly. They give an advantage
TO the towns where they are efabliihed, above
all other towns; and they give an advantage to
Its own Stockholders above all other individuals.
There is no doubt comfortable truth in the
hrlt part of this objection. If banks fcrve to in
create the productive capital OF the fociety, it
mutt more particularly exert this power in
that town or that part of the country, where
they are efablihed. The Directors, being I'M
acquainted with the punttuality and refources
or thoie merchants, who live in dftant parts of
the country, will feel little inclination to diff
count their notes, and lend them their paper.
lheie tranfactions will thus be principally con-
hned to the traders in the town where the bank
is eitablifhed and the greater capital which is
thus put into their hands,would appear to invite
greater number of fellers, and larger flock of
commodities. Several considerations however
contribute to leiien this effect and to weaken
TINS objection. 1T Theie inftitutions need not
be confined to one town. Different banks, or
different branches of the fame bank, might be
ehabllihed IN every town, where the extent of
bullnefS and the demand for capital might be
iutflcIent to produce an adequate profit to the
bank, and an adequate dividend to the holders
or Its ihares. 1t might for ntance be worthy of
enquiry, whether the charter of the bank of Vir-
glnla, which provides for the eftabiihment of
branch banks in Fredericksburg, Norfolk and
Peteriburg, might not have extended the fame
privilege to Winchelter and fome of the towns
OF the upper country. There are fome political
Gconomltts, who even contend that the bufinefs
OF banking ought to be as free and unfettered as
any other bulinefs, and that every individual and
every company ihould have the right ifthey con-
celved 1t to be their interef, to lend their notes.
payable to bearer, exactly like the notes of a
bankf The advantages of fuch a regulation
they have attempted to illuftrate by the hifory
OF the private bankers of England, who have
both extended the credit of &c the Bank of Eng
land and the internal trade of that country.
2nd. i he advantages OF bank are not confined
to the town where 1t is eltablifhed. Difant
towns alto partake of its influence. In bringing
the productions ofthe earth, to the market, fe-
verat fuccetfive capitals mutt frequently be en-
Ployed. The corn or the tobacco, for in
tance, which is railcd near the heads of rivers,
VIII not always be conveyed by the farmer to
the great. emporium for expectation. MANY of
sHS " oiiiti lave market In their own
neIghbourhood. But traders will foon be found.
Places OF depoit are Immediately formed on the
upper parts OF rivers; and fmall towns, flch as
Lynchburg, thus begin to multiply & to increafe.
L he eXteniion OF capital in thoie larger towns,
which are feated nearthe head oftide water or on
the flea coats, & which conftitute the great en-
poria for expectation, neceGarilytends toincreafe
the capital Of thofe fma and ditant towns.
The merchants of thofe towns, who deal with
the bank, will extend their agency to thofe re-
mote Mutations. Copartnerihips will be formed.
which will extend themfeves to thofe diftant
oepoiltories or agents will be appointed, who
receiving capital from their EMPLOYERS, pur-
chaie the productions of the country, and give a
aew ip'Tng to the indufry of the neighbouring
towns. In this manner, the eftabliihment of
banks IN the large towns, will probably contri-
butte TO extend the indutry of the fmall and diff
tant towns, but certainly (and what is of more
conisquence) 1t will promote the indultry and
wealth of the country that furrounds them.
When 1t is objected that banks encourage
monopoly by giving an advantage to ftockhol-
derS, which no other individuals enjoy, it is
meant that it enables the flock holders to receive
adivdend OF 10 or 3 per cent on their money
whereas other individuals Can frequently obtain
no greater profit than s or per cent. Thofe
however who make this objection, do not GER
ta'nly underitand the means by which a bank is
put into operation. Does the fate choofe ont
particular individuals, to whom it gives the pri-
vi!edge of fubfcribing for bank flares No.
Every man, who choofes, is permitted to become
a 1ubfcriber. Surely then what every man
is permitted to do, and to do it freely, can
not be iaid to be under the controul of a mo-
nopoly. Befides, the profits of a flare holder
are really not 70 comfortable as they NAV at
hrt fight appear. When we are told that the
dividend on bank ltock is 10 or l2 per cent, we
are ready to conclude that the profits of this
ltock are very high. We forget however that
Jew men VINO mold this itock, obtain 1t at par
that mott of them were obliged to pay an adj
vance on it of 80 or 40 per cent: and that con-
iequeltly the dividend which mot of them re-
ceiye is not the profit on a 100 dollars, but the
proht on 80 or 40 dollars. Such great pro-
htS are confined to thefe ltockholders only who
originally iubicribed to the tock, or who in
tome ofthe extraordinary fluctuations of the
markets were enabled to purchafe it al very