Daily Richmond Whig. [volume] (Richmond, Va.) 1840-1842, 1841-05-31

L a
D'e IN the city Of New York at par. Nothing else
to be
This circulation of bank notes paya bic a, ncou-
Ne1ient places, Is common most of the COMMERCIAL
eilieS IN greater or less degree. All experience
| shows, IN the earlier periods OF banking a tendency
To false public opinion in this particular, in every
community. The note Of b@nk considered snle
situated IN tho country, isthou ght be equally en-,
| titled To circulation with that OF the city bank
This opinion Is generally sustained by n powerful
country interest IN favor Of country banks The
| true ground ot bank circulation, preference over
| specie, Is not understood. Shopkccpers and small
"cae's 'nlnk IL better TO raise the price Of their
soous rather Than turn away customer who offers
| lhom any bank note. The class OF money brokers
becomes necessary IN this state of things and is
supported out OF this false state of tho currency
he most perfect remedy is in the correction Of pub
nc opinion, which would induce every individual to
tetuse TO receive ms money, any bank note not ex
changeabe for gold or silver without loss IL is in
the power Of the banks, however of every CONNER
cal city, TO regulate its CURRENCY. BY receiving
,he notes oil country banks better than bro
kers can afford to do and enforcing payment tiyor-
ousy, they make il for the interest OF all sound
banks 10 mako an arrangement something like the
Suffolk system.
Banks are highly useful institutions, properly
managed and propey understood; but. like other
GOOD thlnss, they are liable TO abuse. Many abus-
es are sustained by erroneous opinions on the sub
jec'. -
10 he useful, bank must I've founded on solid
capiai. The object must be the useful employ
ment oil capital. There other sufficient ground
OF assurance that the n,ony will he paid when
wanted. Banks are dealers in money. They
shouu pay their notes whenever the convenience of
me holder leads him to demand payment, with the
utmost readiness. They should leave their sircu-
lation TO depend on lis true basis a preference md
treat preference for specie with tue same courtesy
as one Tor notes. 1t is true that bank derives a
proh, from ITS circulaton but the bank becomes an
ABUSE whenever II opposes any obstacle TO the rea-
ny conversion OF It's or credits into coin That
obstacle may consist in viewing the party making
the demand in an unfrendy light. Ii is not uncom :
mon 10 make distinction in regard to brokers. IL
Is sometimes attempted to cast an odium upon them
as the cause OF the inconvenient demands made up
on needy banks. All this Is false. There is little
employment for money brokers where banking is
IN sound state. Bad banking and deprecated cur
renc'eS bring brokers into existence They are not
cause, but effect. Their vocation is wholesome
iney are inc mere agents OF the public. They al
'eVlate evils instead Of creating them.
SUSPENSION OF PAYMENT.
All the evils OF bank currency, however are slight
being small IN amount, local IN their character or
temporary in their operation, compared TO suspen.
SION OF specie payments
This Is the evil under which the United States ar.
now suffering, and which IS tolerated by publIc
opinion to an extent which is truly alarming az re-
ssrus the future character OF our currency.
SuspeHsioa Of specie payments, is the gentle name
apphed 10 the failure or refusal perform the pro-
mise contained on theiace of bank note; general.
accompanied with declaration Of the perfect
AGILITY TO pay, and the intention to do so at some
future time. Properly viewed this refusal deprive.
the bank note OF the only quality which gave i, cir
cuIalon, the poicer TO command the metallic money
winch II purports 10 represent. IL becomes simply
broken promise, end, like other broken promises
Of no other value than the chance that legal coercion
may compel eventual performance; or that The refu-
sal may relax INTO Willingness to pay At some fu-
tuTe time. Ii will be seen that its character has
become totally changed that instead Of possessing
lle Original prinepIe which gave At currency, IL be-
comes IN the hand OF each possessor subject 10 all
the fluctuations which belong to doubtful and nm
certain contingencies. II is true, that single bank
taking this ground will not be sustained-it is a
iai!ure-the bank cannot choose but break But
let part OF the banks OF one of our commercial
cities proclaim this intention, all the others follow
and the public submit, not only without a murmur
Dut give II their commentator. The State CHS
latures give II their san tion, almost ms Il mat
ter ot course. The example is considered so good
that II Is followed by acclamalion and sustained
by the general voice. Like everything else in this
Tree country, II IS public opinion which ssa bishe,
and continues this state Of things first without or
against law-aiterward the law is made to bend TO
ms opinion. IL is true, all affect to consider con-
ulton OF broken promises, and deprecated curren-
cy, as an evil, but It is acquiesced in at once as
sort OF dispenSaton OF Providence. The real evil
IS IN depraved public ppinion which tolera,es tbi,
state OF things At all. The remedy is simple-but
perhaps not very easy-ihe correction of this public
opinion.
IL would not perhaps be difficult 10 show thai n
suspension OF payment by the banks ought never
To be tolerated at ALL IN other words bank notes
snoui1 cease TO perform the functions of Currency
di'er they nave lost oil their proper attributes TINT
the evil OF deprecated paper currency il cye,te,
evil than any other which would be the result Of
maintaining sound currency under any cream
stances Even the suspension of 1887, which is
generally considered TO have been inevitable and
winch was the result Of a state OF thingS which
reasoning priori, no man would have supnosed j.
PosSihle could exist, and which, il is To be hopeJ
never VIII exist agaln-that suspension hns nroh,.
oly produced greater evils upon the communitv
Sons'uereu 10 an us bearings than could possibly
nave resulted, had the New York banks determined
10 continue TO pay specie at all hazards
Without however going into the consideration NJ
this question, there can be no hesitation in main
tanning The proposition, that under no circumstances
should suspension be tolerated but for an exceed
long as year.
Money or currency is an instrument of the frs,
necessity to nation. No trade or commerce can
De carried on without IT, A nation USING currencv
"hoI'y metallic may feel a scarcity OF money hut
cannot be drained Of II, any more than mecb,nic
can be made to part with the tools necessary 10 car
ry on hs daily business OVertrade NAV take nI,ce
IN such communicated excessive importstion NJ
| foreign commodities may cause an exportstion m
| me precious metals, TO degree OF jDeonvenicn,s
ne scarcity OF money resulting from such e1nor.
litIOn reduces prices, the effect Oi which "a IN cbsc
| importation, and promote the e1portation of ali
commodities. and thus the evil soon cures itseIf 10
| the return of the coin necessary TO its trade M
other considerable importation will take place mil
u nus VI this way recovered what is OF all thing,
most important to IT, its tools Of trade
Precisely the same thing takes place undsr , ,gsI
regulated bank currency. II seems 10 he the opn.
ION OF the best writers the subject that lie nos,
perfect bank circulation would he one which sbo,Id
| be precisely equal in amount to what the cirrna-
tIon OF the same country would be in the nres,ops
meta $, were no other circulation permitted
| he great evil Of the modern systern az LorL;,.
IS lhe great huctuailon which il is liable to produce
IN the quantity Of the circulating medium. This is
easily understood. Bank no Is being me- ,Ia,i,,
shown, preferable for common uses 10 coli. and cos;
ing nothing 10 make; the process Of Increasing lie
calculating medium ~ very easy, and Is CERTAIN r.,
60 on until II meesthe necessary check in Jc,,anJ
for payment This check the ind vduaI I,,,l, LII
receive IN rs exchanges with other banks H,y
ever individuals may N their transactions considsr
a bank note as money the banks themselves take a
different view of the matter. A bank bsI,ncc Coo
only be paid in coin. Here IS n check upoo AZ ;a.
dividual bank; but suppose al the inks crns,d
simultaneously or nearly So which is very npt 10 Inc
the case THIS check ceases to operate.
IN the same way an expansion IN one OF the ri,
may De checked IN consequence Of balances bcrg
created against u, and being demanded an s,c.,s
But suppose the cities all expand al the sarne ,iro
and there is a powerful sympathy between ,L",o
the check Is only to he found in The rise Of ,b g.
reign exchanges to point which induces the eY,o,.
tauon OF specie. This foreign export of spers - !,
ihel 'he on'y check TO redundancy, to excess, In