The enquirer. [volume] (Richmond, Va.) 1804-1815, 1804-08-01

that money like any o,her commodity fn6 ct
to all the variations, which the dc.uaul and the
tupply may produce. LSt ther> br two cJu1-
tries, in which the quality ofeXchangeahle COM
modities bears precftly III, fine proportion tn
the value OF the circulating medium, and in this
proportion an allowance mu1 he made for th-
difference IN the Cuickneis Of lis circulationh
An Introduction of 4 create. quantity ofmonsy
into one of them will caui Il part Of it % over
How into the other. The f,ine quantity of COM
mcdities VIII be reprefented in the one By i
large and III the other by 2 inau quantity of no.
ney. ET. ~ commodity will then proportional
bly, he dearer III The one and cheaper IN the O.
Their. Hence the merchants ftke hrs will tind it
20 Dc their intereit 10 pay money inf, AL OF com
moditics in exchange for the productions Of the
lat and the inhabitants ftEe laG Ill in their
turn exchange their commodities not for the
commodities OF the firh, but for fone OF
their tuperfIous Gold and Silver. And by
fuch commercial tranf;t6sions viii the eOuili-
briuln ofmoney be a. length retored between the
two countries. But if the money, which is thus
introduced into one Of the countres, conGf OF
Bank Eo;es or paper money, new operation
rites upon our view. y part of the Whole cir
cua.ing medium, according to the fOregoirg
principle. will leave the country but the banl,
notes will conititute little or part of this ex-
portation, unle1s the countries be very near TO
eachothsr, S veryintimately connected in :r,de !;
becauie sat difance from the banks v.aicA IL
tue them, and from the country i'll which pay
ment of them can be exacted by law, they VIII
not be receivedin common payments."t Hence
the SreateR part of this expectation will conlift
OF the gold and FLYER IN Jrey. When this is font
abroad, 1t will, according to the foregoing priu.
ciple, be exchanged for the commodities of the
other country which will therefore incrcaf.
the capital, the productive indutry, and the
wealth Of the nation.
The introduction of bank notes appears thus
to have an eiiea upon the capital and the
wSalth Of 0ciefy at L1rEe prccifely milar to that
which the operations in the bank previouly ne
ceilary to the introduction of this paper, have
been ihewn to produce upon the capital and
| wealth of an udiViaual. AS the advances on
calh accounts, the ilcounting of notes and bills
| of exchange, contribute to "render greater
part of their capital active and productive than
| would otherwife be TO-" 10 alto the fiibGitution
| of paper money in place of gold and iver, Of i
| cheaper circulating medium in place Of 1 more
| expeniive one, enables the fociety at large to
convert great part of this dead flock into &C.
tive and productive flock into nock which
| produces fomething to the focir.y at Target
Thefe being the principal conit quences of a
Bank new queftion arifes, whctherit be pof-
| iible to reduce theie coufequences to an exact
calculation Whether it be poilibe to afcertain
the precile benefit, the precife augmentation of
| national capital and wealth, which Bank con-
| tributes to produce? Difficult as it may be to
| reduce this benefit to any precife aritbmet:ca!
tatement, 1t will not be difficult to exprelS this
benefit with at leaf certain degree Of preCi-
| fou.
The capital of the Bank OF Virginia viii a
| mount TO 10000 dollars. This fun is taken
from the pockets of individuals; and Il 10 far di-
ninifhes the active capital ofthe rate, md con-
| iequently its productive indufry. Whatever
then might be the profits OF this fun, to the IN
diyiduals who would have employed it, and to
thofe whom it would have employed, thefs pro-
fits NUT nc confdered as LOFT by the efab!iih-
nent of the Bank. The Bank however, with
draws this fun from the capital of the fate, for
no other purpofe than to replace it in the form
OF paper: and this paper is permitted by the
charter ofthe Bank to be three times greater
nearly as good as gold and FLYER, for gold and
iilver may at any time be had for it at the Bank
| 1T has all the ufts of fpecic, aud may thus be
conidered as 70 much capital returned into the
hands of individuals. Whatever profits then
may arife to the individuals WHO employ this
! fun, and to thoie whom they may employ, NAV
! be completely attributed to the operation ofshe
Bank. If then from th-fe profits we fhould de-
duct the profits, which wouldhaverefulted from
ZIG SiIIflONinCHt OF us lDSCle-Cdpltd, the diSr-
ence would truly exprefs the real benefit, the
real increaie ofweath which the Bank renders
| to the individuals OF the fate.
! This is the advantage which refults 10 iaC:ivi.
dual5, from tho augmentation OF their active ca
Pital' but there is another advantage, which it
has been already mentioned, rccults 70 the Gc;ety
at large, from the application Of bank paper to
mott of the purpofes of money from the lub-
! ftitutlon OF cheaper circulating medium, in
I place of more co1y and expenlive one. When
$500, 900 dolls. in notes thrown into circula-
| ton, they occupy the place OF that fun in gold
| or FLYER. 1.-THE notes were not thrown into cir
culation, the focety would be fubie6t to the
I neceiiary eXpence of keeping that amount in
/ gold & FLYER unemployed. The bank, however,
fubietts itfelf to the expence Of keeping ONLY its
own capital of 100000 dollars in foecie, unem.
ployed in lis Golfers What the fOciety, therefore
gains, is not the difference between The value OF
/ 100000 dollars III fpecie, and the cxpcnce OF
! originally manufacturing that amount of paper
and Of maintaining it in circulation, but the diff
ference between tie value Of 5000 900 dollars
! ~ iPecic, and the eXpence of making 70 muc,,
representative paper, and maintaining it in cir
culati0n. But this expence is by no means con
| iiderabic. The rent OF competent houfe, the
cot Of its paper, of the engraved plates, and OF
the itationary, the fi,ary of its officers, and the
expence OF continually fupplyng gold and FLYER,
when the necef6ty ofthe bluk rsquircst, can by
f,,, I q a. 80.