True American. [volume] (New Orleans [La.]) 1835-18??, 1839-03-06

Room of the True American Office, St |
Charles Exchange, by the dozen or single
copy.
Free BANxlNa-7he Bee.-We have heretofore 4
planned the principles of the system Of Free Banking
which has leen introduced into the States Of N. York
and Georgia, and which, long, will be adopted by
other States. We lave shown lis applicability to this
resi and in what it will tend to the advantage
aud prosperity u Louisiana. The mystery with which
some would clohe it, dwes only in their bloa,ed ina
ginations which envelope every Thing with involutions
and obscurtes, and cannot elucidae the plain and
others, apparent truths which feed on distractions, and
monsrosi,es Of their creation, and threat ming
dangers end falling castles, which lie the ata Mar
CANA, live only in the clouds.
We shall not so back and travel over the ground
have already occupied in explaining and advocating
the system Of Free Banking. Our present purpose is
TO examine of the false positions assumed by the
Bee yesterday, and expose the fallaces. In for
article showed that the conductors of the Bee
approached this subject with seeming relucance that
was to almost nexpicable unless from The fact that
the paper was subject in some to the will of
OF the present Banking Institutions that looked
with jealous eye to the establishment of the Free
Banking system, from IN ignorance of the subject
and unwngness TO examine it and he convinced OF
its immense utility. Which is the cause were
| at loss to determine. Probably each had a like in
Auence.
The Bee not altogether certain which course to
pursue. The in medals res lutssinus," suggested
itself and it proclaimed that the editors neither
'pnrtiZans adversaries that some of the features
of the system assuredy advantageous and that
fears only entertained of the extent to which it
might be carried out In tho article however,
jesuitical and nsnua ting in,imations cal
cuated TO miscad and warp the casual reader and to
gain the opposition of those who not looking below the
surface of things, nigh, be influenced without well
knowing how the impression had been made, and how
they arrived at the posuate We exposed this iusdi-
effort Of the Bee and have Its confession,
although "fuy that they are running counter TO
popular feeling, yet they stake ground gainsi Free
Banking"
| The article which claims SHIRE of our atten.
tion is elaborate effort make the worse appear
the bettet cause" misead the public mind by throw
ing sand into the eyes of the reader it is the produc.
ton OF one who does understand the subject and
who labors to make the of his snatteug to Lols
ter up the position which it is his interest to assume.
1t commences: 1t will be d.. 'ult to show that the
emissions OF banks based stocks the mortgage of
than those based upon specie.''
Here is posiulamm in thu very outset which leaves
or rather attempts to con'rive the Inference that the
| tree banking system will have no specie basis -
whereas the banking companies under that $, stem, will
be compelled by law to keep certain and defined
amount of specie hand and their property stocks,
&c held securities for the ultimate redemption
of the circulation OF their notes, should they fail to
comply with the acquisitions of the law and find them
selves unable to the demands against them with
specie. The Bee says "a circulation is good in pro-
portion to the certainty with which it can be converted
into spccie.'-Grancd for under the free banking svs-
TEN it is almost, ifnot entirely, reduced to etuin,y
that the circulation will be redeemed in spece. The
securities are stronger than under the present system
Of banking for not only is his credit stake, but the
stockholders property is pledged and placed in the
hands of the Comptroller that can be used for
the benefit of the bill holder. The Bee continues -
" The holder of bank note does inquire into the
ultimate solvency of the bank the resources belong.
ing to it, whereby eventual payment may be had; he
looks upon ii as money, because he get the
I for it upon application and not upon suit"
There we are nj ssue-a bill holder does inqu re
into tie sovencv cfthe bank and the belong
ing to it; where does the bank re its credit
If not in the sovency the bank, and confidence in its
resources. A bnnk may BIZ paying specie to ,uv, and
according the logic of the Bee, that tact is all that
the bill !der inquiries into, to make him feel perfectly
safe, but mnv have dollar left wherewitl to re-
deem its notes IN the morrow. The Free banking sys.
tenn prepares for such event. certain remedy.
The resources ara firmly held in the equiraienk of
ne,-socks and renl estate the uH ralue of the del Is
Of the company; is the creditor compelled to bring
"su" The comptroller Immediately converts the pro-
NOR ,,Ioflr 1
But the Bee thinks-"A man may have property ts
the amount OF Millions and may issue promssory
to tho amount Of only few thousands, yc, those notes
will not pass as money. not~ outstanding the community
may have no doubts us TO the snvency Of the maker
and the abundant security which his vast property offers
for payment"
We join issue us tn the applicability of this position
to the proposed free banking SYSTEM il indeed we do not
question its utter In the first place. as W
have beor shown that the property is pledged to The
STATE and that money is scd on the credit of the
scrip issued upon the faith of such pledge and
upon that money with the security Of property reserved
therefor, the banking operations carried on. In the
second place, is it novelty for large landed and other
capitalists to cash their proni$sory notes the hypo
lhecation of their properly? When man is known to
have m Lions il is very easy for HIN loconverl his prom.
isory for few thousands into circulating me.
dunn to pass them current, in any business oper
tons, he may have to transact. For after ALL credi
forms large portion ofour capital; and he who fan
cies that banks individuals have dollar for col
lar in Specie for the redemption of their circulation is
| a fit subject fur Utopia.
| But the Bee says:
| "Suppose then the Legislature. incorporates his
houses and lands and securities will suc an act
change the nature OF the property? Will it make it
more convertible, it give greater security and
circulation to the promiss"ry notes issued upon it,"
! These questions asked with somewhat trium
pLal air. though the aueris tossed up his hea as
much as to say, "Answer the that, if you can" Well
suppose the Free Banking Law is passed, and suc,
property as las been designated form the basis of a
| company incorporated under it, will not State scrp
for which ibis property las been pledged, AMI which
he State promises to faithfully redeemed, and or
which she feels that ample saaurity has been given
obtain greater credit and general circulation
than individual promises to payl But the Bee answers
the questions in this wise:
aUntil an of the Legislature can convert houses
into gold, and Coin lands banking privileges granted
upon the hypohecaton Of houses and lands will mott
in reality afford better security to the holder
notes that those notes will be cashe upon app cuton
Than L the banking privileges were NOT gun.ed. The
securities remaining unchanged, the act of ncorporn
ton does not in the least egee add their amplitude
4 0r qualification Il basis Of currency. They are
technically the same, and issued pon Them aye
lust as 60 ID and well secured without ai &c, Of iucor