The Columbia Democrat. [volume] (Bloomsburg, Pa.) 1837-1850, 1840-01-11

thus founded upon paper, and whose capital
has been actually supplied, not by their
stockholders, but by the community, have
gradually by the workings Of false and an
li.republican system, after paying large sal
aries to their presidents, cashiers, clerks,
counsel and bOrers at Harrisburg-very
heavy expenses for their ordinary and ex-
traordinaIy nagement-enormous diyi-
dends and the usual losses OF businessmen
only made whole their capital, bat in many
instances have increased ii, without any
calls for additional instalments upon those
interested in their stock.
We observed in May last, that the bank
which was lowest in the first class, after
passing through the suspension of 1887,
declared dividend Of five per cent, and
an extra dividend of twenty per cent; ma
king twenty-five per cent, which it divided
amongst its stockholders, and yet this bank
was nsolvent in lS24-Iefused to pay
specie in 1887 and lS3S-relused agaiu on
the 9th Of October, 1899, and durin0 the
next month declared and paid large divi-
dend in direct defiance of the law, and OF
the known opinion of the execution.
There must be something radically wrong
in such system which allows the holders
of corporate privileges; species of scrip
nobility, 10 make their capital, dividends,
profits and expenses, out of those whose
only acquaintance with banks is created by
their holding their promises to pay, IN lieu
| of the only constitutional currency, gold and
! silver coin. New charters for new banks
were afterwards granted at different inter-
walls, upon different grounds, some perhaps
| founded in reason, but for the most part
only cloaking some selfish design OF eXtor-
ting portion Of their hard earnings from
the industrious poor
From 1924 TO 1885 inclusive, the bank
ing capital paid in, increased to $ls,99l,-
S63 oil, being nominal increase in not
quite twelve years of 1851, 1926, OIL.
We have called it nominal increase,
because from the uniform practice in taking
bank stock, it is perfectly clear, that large
part of it was originally fictitious, being
simply an exchange of stock or scrip, for
the stock notes of the nominal stockholders.
This is well explained in the excuse made
bv the Cashier of bank in Philadelphia 10
the Auditor General in 1886, for SO large
an amour. appearing in the accounts of his
bank to be loaned upon stock. al would
briefly state" said he "lhat by an act oI
the Legislature OF the ooh May last, we
were authorized TO increase Our capital
stock. a LARGE PORTION OF this new stock
was taken by our present stockholders,
(hey paving at the time of subscribing, q
part in money and giving note for the bal
! ance secured by pledge OF The stock TO be
renewed every sixty days upon the pay
, ment of i've do lars on each share. A very
large part Of the above amount, (565, ,0GG
G6) has grown out of this arrangement"
o This bank, On the 4th November, 1886
: returned lis capital paid in $399,750, 90
+. When by its own shelving ii appeared tina
only 334, 1888, "a dollars. were actually
. paid by its stockholders. Here was gross
{ violation of law which should have beel
i. punished with great severity, as its obvious
J.. ohiecls were first to impose upon the com
p munity fictitious for real capltal-ant
:. second TO allow its stockholders who hat
q not tie means 10 pay for the STOCK, to pay
:. only six per cent, to the bank whilst lhey
u drew at the rate of ten per cent, from
I the public, beideS paying all expenses an
!. losses.
n After therefore making the necessary re
duclions for similar subscriptions Of capita
for their own stock purchased in by thes
inslitutions--bad debts and other contia
gencies-the actual banking capital Of Penn
0 sylvania.
In De mber, 1885, cannot be rated ;
8 more than $l5,O0O,00O 0
= On the 81 November, 1885, the actual eli
o culaton Of the banks
: was SlO,853, ,O24 6
a." Of which, taking the report
! of the state treasurer Of the
18th of January, 1885,
u as guide, were in five
a. = dollar notes, s2,Ol4,525 Q
Leaving Ss,339,699 G
lie As the bank note circulation of the state
IS notes of ten dollars and upwards.
<, In February, 1886, the bank note circl
5, lation increased to ST ,657 ,9S2 ~, and
ic May, 1886, lhout a dollar increase
,f- capital paid in-and only an addition
IT, Sl68, l46 56 in specie--il increased TO Il
OF enormous amount Of Sl4 ,40l ,792 81 ,beiT
ms nearly dollar for dollar Of real capital, al
= l.