Virginia Argus. [volume] (Richmond, Va.) 1796-1816, 1816-01-13
REPORT ON BANKS.
Submitted to the House of Deierates Q

\ The Committee to whom were referred
| sundry petitions for Branches of the exist.
ing banks or the Incorporation of Indepen-
dent banks within various parts ofthe Conn
m0nwealth, with instructions to make the
following enquiries-whether there exists
any depreciation of the current paper me-
diuius an;: If there be such depreciation
the actual extent, true cause and proper
remedy thereof? whether any unchartered
BanaiGg companies have been recently
formed within the Commonwealth, what
nieaIs should be devised to guard the
Chartered Banks against the infraction Of
their privileges, and the Commonwealth "a
gainst the abuses of private banking -
have prepared a Report, which they res
pectfully submit to the House of Dele
gates:
In performing the duty assigned to
them, your committee deem il necessary
! To premise Some general observations usnn
the nature OF the subject, on which thew
have seen required tn .ct, before they call
the attention OF the House, to the result of
tie eaquiries which they were instructed
t. make.
Anindividual, possessed of money or
stock, g may derive revenue'' either
6 from employing it," himself, or" lend.
INC 1t" TO Others. s. In the one case, mis-
revenue is profit, in the other interest."-
The first constitutes the revenue of Mer-
| chant, the last of Banker.
Were every individual, wko has money
which he can lend more proftably, than he
can himself employ it, to become a banker,
or attempt to draw the whole or the srea-
ter part OF his income from loans, he would
lose the benefit which he proposes to him
sell from lending at all. As the rate of
interest is restrained both by law and me-
cesslty, unless his stock was great, his in
| come would not maintain him.
Before large capitals are amassed in any
country, the lending of money will be con
nected, therefore, with some other lucra-
tive business. Tie capital which might
! be productivity loaned, will often lie idle
in the bands Of the lender-and some
times, for the sake Of extraordinary gain
he will demand, and receive for it, high
er interest than the law authorises.
/ What every stakeholder, with small
\ capital, must labor under great disadvap-
tases III doing separately number of IN
! eividuals associated together, and acting,
by common agent. may render alike
profitable and convenient.
Their capitals, however small, when Ia
\ ken apart. will togethec be large enough,
alter paying the salary or wages of their
agent, aud the rent of his house, to yield
to them considerable income.
number OF persons, so dealing in mo-
neg, and binding themselves, by their a.
gent In their individual capacity, to those
! with whom he t'ansacts their business,
Constitutes IN the simplest form, what is
usually tened - A Bank" And if the
employ ment OF such Bank consisted in
lending IL men OF good credit, or upon ap-
| proved security, the gold aud silver co N
0t cOuhtry, the common representative
/ OF value anu medium of exchange, it is
presumed that no objection could Oe made
to such an institution, which would not e.
| qualify apply to any other employment Of
| Stock or laD0ur, or to any Other means OF
! augmentlng the wealth of a nation.
The benefits which it assures to the
StockhDider OF leader, are economy of
tine /; the ce, tainty of receiving his IN
come, when 1T becomes due-increased Sc
curity against the total or partial loss OF the
| capital OIL winch it accrue5, and a new ia
cility of converting his money, while it
continues productive, into any other spe-
cies OF stock, either for the purposes OF a.
| gticulture, manufactures or commerce.
| The price of Bank Stock, fluctuates
more than the value of dead capital in
! money, but less than the notes or bonds of
individuals and the danger of losing the
capital itself, by violence, fraud or acct
dent, is less than that which attaches eli
ther to the current coin OF the country, or
to such obligations,
The benefits, which the borrower de-
! riyes from such an institution, ace scarcely
less important. They may be comprised
in he increased facility aud certainty OF
obtaining his required loan, upon giving
security for its re payment, at a fixed peril
od.
To this he is indebted, not only for the
more active employmentOf whatever other
capital he possesses, bat for being able to
devote his undivided attention to his pecu-
liar occupation. The condition on which
he may nope for the renewal of his loan,
being its puuctual repayment, when due,
his integrity is guaranteed by this interest.
A minute inspection OF the simple me-
chanisIn of Bank evinces that as a labonr
saving machiuc, It is of great value to
the commerce Of any country. A fire
proof house and halfa dozen persons in a
large City, perform by its means, the pur-
pose Of countless bolts, and numerous
clerks. Il saves many anxious nights and
IabOrious DAYS.