Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1841-02-04

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Ibis time was, to extent an experiment, at least
by the Banks in of the States North ct this; and
the power Of the Banks of this State to MAINTAIN their
resumption depended, in great degree, upon those
Banks the balance of trade being IN their favor and
our Banks constantly falling in their debt Serious
doubts were entertained us to the ability OF the fenn-
sylvania Banks to maintain specie payment tor any
length of time and in the event that they did not
hold on, the Maryland Banks, IN all prooao'i y would
! susnend The issue of small notes for short time
would STRENGTHEN their Banks very much, and assist
them in their efforts redecm their notes. by providing
con enent circulation Tor the purposes OF change Tor
those who would be content 10 receive the same IN lieu
nj the silver and would thereby prevent the
sorv drain of their specie-whst, at the same time,
those who prefer the silver could at any me convert
these small issues into it. And, again, the issue Of
notes Of less denomination than FIVE dollars, until the
neriod should arrive when the ability Of thosc Banks
10 The north Of them to continue specie payments would
be fairly tested would force out OF circulation the small
notes of distant banks in the surrounding States, and,
of course, strengthen their own to the extent of the
amount Of these small notes which had been and were
still in circulation amongst them. lie begged leave
to repeat thut the bill was temporary only,
and in his judgment, calculated 10 assist the Banks Of
this State 10 maintain the resumption of specie pay.
ments.
Mr.. ROBERTSON urged the passage Of the bill.-He
described it as designed aid the Banks in maintaining
specie payments II sought 10 effect the object by au-.
thorsng the issue of small bills to limited amount,
for limited time The amount, per cent. the CAPT.
score, if the bill otherwise palaable. The time
TO which the authority was limited list AugusO was,
perhaps, short as would answer any valuable pur-
pose. These issues attended with some expense to
the Banks. If the time should be 50 short us not TO
compensate that expense the notes would not be issued
at all Another reason was be found in the consd
Grafton that some of The Banks having plates and
others not, period too limited would operate unequal
| ly-beneft,ng those only that now had plates The
bill does not affect the provisions Of the charters fixing
| limit he Gil @
still conhne their issues so as 10 preserve The ratio
| fixed BY law ofpaper coin. The effect was merely to
alter the denominations; not enlarge the amount OF
! Bank issues. How could that possibly influence the
ability of he Bank TO meet lis liabilities, In respect 10
an'indridual-is his condition worse, if he owe thou
sand dollars bonds Of ten dollars of thousand
dollars Is he any less able to pay The than
in the other And how can 1t be different in the case
ola Bank
|, recommends itself to the favor Of the House by
securing the convertbilty of the small issues in the
most absolute manner-and especially, because, in thus
ensurng payment IN specie OF small notes, IT protects
the poorer classes, whnse dealings confined to small
sums 1t authorizes the recovery in specie by warran,
before justice Of the peace of the amount of any
note with % per cent. damages in addition Besides,
il is to be observed the notes are only tn he issued To
those who pre- fer them and are reurnabr, ut pleasure,
hy any into whose hands they may afterwards fall.
/ The good effects of the bill were twofold To some
extent, the small issued by all the States around
ms would circulate if there of In
nrdinu currency that could be relied on, for they
| kne little Of aud always exposed them to loss AT
this moment overrun by small bills from
abroad and suffering, too from the doubtful and
det-riorated value Of Of them.
i The other benefit by enabling Banks TO retain
in their vaults what would else be withdrawn Tor do
mcstic uses strengthen them against the competition
they must necessarily engage IN with institutions out
nf the State. Some months must elapse before the
cGuil hrum Of trade and business would be reesabsf
Ind ctv n ,rpnt q
require all its just advantages, and hence the Banks
elsewhere must be expected to demand from ours all
, they had claim to. Hence, through this perod-,hs
stress upon Banks-we should afford them every
proper aid.
He believed the objection to the small bills policy
most relied upon, was, that the specie, which would
otherwise circulate in their stead would afford means
ofrepenshng the vaults of the banks in Of n run
upon them for the precious metals. This opinion he
thought altogether fallacIous The drain of specie,
whenever occurs, and whatever the cause, implies,
of necessity, its greater value al other point than
that which the run is made upon. Iii when bills upon
the point to which remittanccs to be made cost
more than it would cost to remit specie 1t shews IT.
self by depostors in the Banks holders of their bills
demanding their dues in coin. Specie at once becomes
commodity in the market, commanding premium
IN the paper currency Then il is, and then only the
Banks stand in need OF il, 10 turtiiy them against
the run that has commenced upon them. But from
that moment, not n dollar of coin goes into their
vaults. A debtor having $1,000 in specie, worth
premium in notes, and owing that sum at Bank con-
verts his specie into the notes of the Bank he IS IN
debted TO- pockets the premium, and pays the 81 900
in Deposites also cease, except in notes INTO
which all coin converted for the advantage of the
premium. Hence it is perceived, that the supposed
benefit the Banks are derive in time Of PRESSURE
from the specie part Of the circulating medium wholly
usory. They want it when others want II, and be-
cause others want il; and then it bears premium, and
of course never finds lis way into their vaults.
The policy of small issues al the period Of resumption
Epulo nd ip1S ~ thor1p
in aid of the Bank of England In 1873, he believed
they were issued by every State III the UnIon save
three or four 1t had been the uniform policy OF this
House. save in the first session after the suspension Of
1887 Experience had shewn the impocy of the course
then pursued, and had since been abandoned by TINS
body, at east-the body Immediately represent
;. ing The wishes, and acquainted with the wants OF
the people In respect to the general policy OF
small bills, he wonld only say now, that u u d'a
strengthen banking institutions it could not be
maintained 10 be hurful. lie would appeal to the fac
that the Scotch banks, universally believed to be the
best managed in Europe, had issued 81 notes since
1 1876; that the New England banks the most success
fully managed in the u S.,-especally those OF Mas
sachusets and Rhode Island, which had stood firm,
while others gave way-had always issued one and two
dollar bills; and 10 the fourth fact, that the Bank OF
France which suspended in 1905, then issued no note
under $780, and the Bank of England, when IT sns-
pended had bills under S25. In the face OF these
facts, could not be maintained that the denomination
of bulls had much TO do with the ability to pay speeie
Mr.. CRurcHrIELD, in his usual clear, straightforward
STYLE urged upon the House the necessity which exist
ed for passing the BILL There was no compuson upon
any man these smaller notes, any other, unless
he thought proper He could go to the Bank and demand
silver whenever he thought proper and there was an
express provision that if any bank should fail to pay in
specie any issued by il in virtue of the act now be-
fore Them when duly presented for payment, that the
holder Of any such mighta once, recover the
amount thereof with twentyf per cent damages on
the same, by before Justice of the Peace If
gentlemen the other side, who were IN favor OF IN
definite posponement, were not conendng tor mere
abstraction he should be glad TO hear any reasons tor
their opposition.
Mr. CowAx was not sent there to regard or protect
the interests fthe Bank Bank interests, but to take
care that bis constituents not injured IN any way
These Banks had deceived them twice thrice nlrea
dy and he disposed to grant them any further
privileges. He wished TO see specie in the hands OF
the labourers the country, instead of shln-pasers
and the effect of this bill would be 10 decrease the spe
4 IL. .....lasL N ihar