The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-05-17


Mr.. ALLEN presented the following resolution,
which, being objected 10, lies over one day
Iacsoiped, That the Committee for the District OF
Columbia procure and report to the Senate stare
mens Of the condition of The several banks IN The
District Of Columbia that have applied for an exien
sion Of their charters in regard the following par
uculars:
4. The names Of the officers and directors OF the
banks the amount Of stock owned by EACH ana the
debts due from each 10 the banks respectively, dis
terminating between the executive legislative, ana
judicial officers among them and also between resi-
dents and nom residents.
2. The stockholders Of the banks respectively, The
amount Of stock owned byeach and Of debt due from
each, discriminating as above.
3. The debtors 10 the banks respectively and The
amount due from each, discriminating as above.
A. The numbered suits that the banks respectively
have Instituted against their debtors since the Sus
pension Of specie payments, and the amount due
from each, discriminating as above.
The objectionto an immediate decision on this reso
luton was made by MIR. ROANE, who said he was
willing that any information on the subject should
be procured but he did not like 10 have the bill de-
layed especially The greater portion OF the infor-
nation called for by the resolution and all that was
proper and of any real importance, was already on
The table Of the Senate. Mr. r spoke with strong
disapprobation Of The part Of the resolution which
called for examination into the private affairs OF
the banks in their dealings with individuals, Il
could not be made without violation OF The hlSh
principles Of morality
The resolution consequently laid on the table
for to-day, and ordered 10 be printed.
The bills to prevent the counerfeiing OF ireasu-
ry notes. and for the relief Of Vespasian Ellis were
severaly read third time and passed.
BANKS IN THE DISTRICT OF COLUMBIA.
The Senate resumed the consideration Of the bill
to continue the corporate existence Of The banks In
the District of Columbia.
The question being on Mr.. BUCHANAN'S
amendment require the banks 10 retain an amonnt
of specie equal 10 their circulation and tothe average
80 III al
deposites.
Mr.. NILES spoke long time in favor Of the
amendment, and in reply to Mr.. Riyes' remarks OF
yesterday.
MIR. KNIGHT said: The Senator from Connect
for protecting the people against extraordinary
issues of bank paper. Scam L. II is for the proiec
tion Of The people in their business concerns that
shall vote against this amendment. consider 1t
best take the circulation only the rule 10 govern
the specie, and not The deposes and circulation
proposed by the amendment. If we include the de-
posiles also, it will cause such huciuaiion in the
business OF banks as to operate on the merchants and
others owing and doing business with them. Every
additional deposite will disturb the relations of those
whose business is connected with these institutions
We all know that every bank has accounts with
merchants whose daily business changes their situa-
ton in regard to deposes in the bank, and by the
change ofther accounts the proportions of deposiles
and circulation disturbed Also making il almost
impossible for the banks TO prevent calling on their
customers in a manner that would prevent all re-
known that most banks have general rule in regard
TO the payments notes falling due. Some cut off,
is called 25 others so per cent and some more,
when note falls due. This is understood by the
merchant and he arranges his buSiness accordingly.
But il you make the depostcs the rule Of circula-
tion there can be no dependence on the amount that
will be needed by the bank; the larger the depoSe
made the more must be paid by the person on his
note 70 sustain the proper proportions Suppose
the amount of ten thousand dollars 10 bank ofhis
District to be collected, and the bank receives the
money in the bills of the Bank OF Georgetown, then
the bank must immediately call on its customers to
pay more money in consequence of having received
the deposite of the ten thousand dollars than il other
wise would have done had circulation only been
regarded. Or the bank receiving the bills Of the
Bank OF Georgetown must Immediately send for spe-
Gle, and thereby disturb the relations existing be-
tween the Bank of Georgetown and its customers.
And il is this continued fucuation and disturbance
Of the merchants traders and others in their bust
ness, which is the reason of my objection 10 the
amendment II the circulation only the rule, 1t
would be avoided and the bank of Philadelphia
would be raid without accompanying the business
community of this District.
am not in favor of over issues of paper would
restrict them to three for one, and am inclined to
favor but two for as the rule. Whenever there
shall be general run for specie do not think that
any bank can stand with three paper dollars in cir
culaon for one of specie. A sufficient number Of
its bills can be collected TO draw all lis specie from il;
but two for one and think il would stand any run
that could be made on it,
Ii is stated that the banks, in 1929, had but one
dollar in specie for eight in circulation That was
very hard year for the banking business of the
country; and, if there had been great demand for
specie in the year 1929 there was in 1887 believe
the banks must have failed to pay specie One to
eight is too great an extension, am lnclined TO the
belief that there was more specie in the banks the
last year than there in 1922 but the demand for
ii was much greater.
But, sir what is the penalty ifthe banks should go
tba1 II 10 fprGpi nf
charter but only TO make the directors liable for the
excess. In Rhode Island the directors are liable
for any improper conduct of the bank; and, in many
of the banks the stockholders are liable for the bills
issued. There the billholders have preference;
the bills in circulation must be first paid out Of the
assets or effects of the bank. They have lien by
law the effects of the bank, before all others.
The banks of that State as general average issue
about three of paper TO of specie in their vaults.
There may be, at times some variation; but that is
very near as a general rule. .,..
If this amendment should be carried, it will be
necessary TO to strike out the nefuurth part,
and insert one-thrd, one-haf shall be thought
best if the principle of circulation only should be
adopted.
MIR. NILES spoke briefly in reply to Mr.. Knight.
Mr.. BENTON spoke at considerable length in
favor of the amendment or something yet more
rigid.
Mr. HUBBARD spoke briefly against the amend
ment, and said he would rather increase The proper
ton Of specie 10 the circulation, than to fix, as by
lhe amendment, part Oh the proportion on the ue-
poSiteS. ....
Mr. ALLEN, on account of the absence of MIR.
Buchanan, and with view to obtain the informa-
ton called for by his resolution moved to lay the
bill on the table, Negatived as follows:
YEAS-Messrs Allen, Benton, Brown, Clay, Of
Alabama, Cuthbert Fulton, Grundy, Morris, Niles,
Norvell, Robinson, Smith, OF Connecticut, Strange,
TTotter, Wiams-l5.
NAYS-Messrs. Clay, of Kentucky, Clayton,
Crenden, Davis, Hubbard, King, Knight, Lump
kin, Mouton, Nicholas, Pierce, Prentiss, Preston,
Rives, Roane, Ruggles, Sewer, Smith, OF Indiana,