Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1821-02-01

aud Throughout the western country, Hns re
banks has not yet been introduced, was go
great az 90 warrant. without risk of deprecia-
ton, a very extensive emission. At that peril
cd, the ordinary divideuds Of our banks weie
eight per cent. because the amount OF Issues
bore large proportion 10 the then existing
amount of capital. During the suspension
of specie payments too. the dividends were
high, because as there was no restraint upon
issues. the banks drew an interest upon a much
greater sum, than they could have done had
specie payments never been suspended. Bu,,
both these sources of extraordinary profit
have forever disappeared.-The banks OF the
interior are able TO supply their own Local
currency, aud the notes of each must neceS.
sarily be restricted in their circulation. But
tbis is not all. From the principles OF curren.
cy which we have laid down. il will appear
that after u sound medium shall have been
really established, all the ba Bks united will
only be able TO keepin circulation the amount
of paper credits, which could have been
maintained without depreciation, when the
banking capiia al was half of its present smount.
In other words all the profits of banking
must hereafter be divided amongst a greater
lumber OF capitals. aud Of consequence the
proportion which each will receive must ne.
cessarily be diminished. Under the present
amount OF banking capital. your committee
conceive, That greater dividend than six
per cent. per annum can never be looked for,
nutii by Tue enciesse Of population and trade.
which will be the work of very many wears,
the old relations between supply aHd deniaud
which formerly subsisted. shall be restored.
Inc second provision applicable 10 new CD z.
teisis That no bank should make loans apon
me security OF its own stock. The adOptiou
OF this provision would prevent thai odious
system OF spe culsiion III bank stock which
mas ruined 80 many hundreds OF orr citizens
anu brought losses on SO many thousands of
helpless and deiuded persons who were Sc.
ducrd by The artificial rise of Stock, to em-
Dark their capitals in lis purchase. When a
ioah Is made on the security of stock, the
responsibility OF The borrower Is scarcely re.
gaIded Now il is manifest, that il the
"hoie capital OF bank were loaned upon the
security and deposit OF it's own stock, 10 b0r-
lowers VINO possessed no other property
than that stock. there would be no bank
vSp''a'. Aud u is equally clear, that Just ii
Tue proportion that such loans are made TO
sucn men, just in that prop0it ton is the capi-
! tdI OF he bank diminished aud OF course The
secHrity OF the public who have claims upou
.he BANK, either IN the form OF notes or de
hnpaire"' Besides this, TO tend on the
STOCK TO individuals, whose personal credit
cn"id mol command the loan, aud uto are Ire
Class ~ persons most likely to borxsw. i'm thar
| nIanner, Is an act OF gross injustice TO the
| ,eai oona ;fde stakeholder, inasmuch as The
latter Is thereby made o.partner with ner-
sons, who have advanced nothing IN Tho
s'ock, ana ~ obliged 10 bear all losses of the
| institution, without the prospect OF reapiny
any thing more than u proportion Of the pro
bab'e profits. fO
With this exposition of their views in reI,.
tioh 10 Tie important subject referred 10
theh,, ana with tie further recommendation
'hat pfoVisiou be made in all renewals of char
.efs TOT an annual statement OF their affairs
as 'uey Suall stanu OF tie first MONDAY il,
November .yonr committee close their renort
anh submit Tor the consideration of the SEN
ate. the following resonriou:
6esolred, That il is nor ex pc dieu, 10 renew
tie cnhrter ofany bank iU this common
wealth;nut nuder the restrictions recommends
ed Ia this rerort.