The Madisonian. [volume] (Washington City [D.C.]) 1837-1845, 1841-11-06
FOR THE MAIDS
PRY.

Mn. EDITOR: Having observed your purpose to
"devote portion of your columns to brief history
of Banks and Banking !" and considering that some
instruction may be cleaned from retrospection OF
past views having reference to facts and circumstan-
somewhat analogous at the present day, beg to
present the subjoned extract from the Itinerary
American traveller"
LONDON, Sept. 10, 1899.
at has been my intention to extend
remarks upon the continued suspension of the specie
payments by the Bank, and the existing state OF mo-
ney matters in this country whereby the anomaly OF
an inconv erble paper currency has been found sufi
Gent for the common purposes of commerce and cir
culaton within the country; and to sustain the ma
ton in the most terrible conflict of modern warfare
"The Bank of England, by permission Of the Gov
ernment discontinued its coin payments in l797-
Although the Bank is merely private corporation as
regards its capital stock yet depository and dis
bulsing agent of the National revenue, and manager
Of the public debt interest subssts with the Gov
ernment to which it is bound by statutory restrictions,
and by which direct influence may be exercised, and
controlling power interposed in any important emer-
gency, amounting almost to absolute authority.
Experience has proved that the notes Of the Bank
of England regulatedn value by the fluctuations oil
foreign exchanges; and Notwithstanding this incon-
trovertibiIiy, they now at par, and gold may be
had for bank paper, without apremum, in sums suffi-
cient for ordinary DEALINGS and silver sxpences, shi-
lings and freely paid in small transactions,
as the issues of the Bank not for less than one
pound
"My banker has met my checks with gold, when
:xl.o hat fact
and gentleman, with whom was but slightly &C
quainted being about IL return with to the United
States, and having two thousand guineas without
occasion for them here offered them to for my bill
on Philadelphia which accepted, and the COM
mutation effected, although the exchange was then
against Philadelphia"
In considering the novel condition of the circu-
ating medium, the expediency and justice of confer
ring upon private corporation one of the most essen
tal of sovereign rights, substantially the privilege of
coming money, may we'll be questioned The power
of such an institution Is enormous. And appealing
it does to the cupdy of its possessors in the para
mount principle of all human action, to-wit selfin-
terest- that power will be exercised to the ut
most limitation which policy or interest may dictate
or authorize. And its propretors, their agents,
lance upon the protective interpositon of the Minis
ter, as proved in the existing instance. Would
it not therefore, be Wise Gas it certainly would
be more just retain the control of the currency in
the hands of the National Administration, or de-
partment of the Government, under adequate restrc
tons and regulations to the country against the
mischefs and mseries of nordinate expansions, and
sudden contractions of the measure of value 1t
Con this subject the antagonist statesmen, Hamil-
ton and Jefferson, who were lately the official advi
sers Of Washington, substantially agreed, although
a. opposite the antpodes other points of policy
ut understood, however, that the British sys-
tenn meaning their codical protection of industry with
in the realm, land particularly with reference to
ufactures] which sustans their external commerce
and navigation and is the principal constituent and
foundation Of this stupendous fabric is mainly in
debted to the vast of their public securities in
their daily interchanges-thus constituting large
proportion of the actual Currency and aording efec-
tive capital for every useful entepriseas large trans
actions generally settled in 'consols funded,
or floating, public debt, of some sort, which impars
momentum and constant action to their circulation,
and tends to noursh and nvgorae the great body of
the nation. have been recently informed by an in
tellgent merchant with whom am in familiar habits
that on receiving money to the amount of thousand
pounds, without a known demand for it within three
days. it has been his practice to invest it in exchequer
bills, security which could be negotiated in
payments, or converted into cash when wanted,--
whereby 1.-THE purchase and transfer being effected by
himself in person] the intermediate interest would be
realised and in aid of current domestic expen-
ditures."
These annotations were made by the writer in the
early annals Of his manhood, more than forty years
ago, as will appear from the date under which they
were wrttenand he nigh refer to recorded evidences
at intermediate dates to prove the undertaking con.
sistency of his views and opinions on the topics in
question. And are not "facts and circumstances"
exposed and mooted SO long ago, which have since
been wofully realized and verified of some value as
beacon lights to avoid the of past disasters
and miseries 7 The inquiry is pregnant with perma-
nent interests
The improvement of national currency, under the
direction Of apubc financial institution independent
OF the Executive authority, was contemplated by the
late economist David Ricardo, who was, as well. an
M. P. and director of the Bank of England az NAV
be seen in the Plan of National Bank" published
by his executors in 1924 wherein the Justice and 81.
pedency of the proposition most clearly demonstra-
ted But although just and proper in country where
all power is concentrated in Government il might
not be so suitable and appropriate to the political sys-
tenn of this Confedeacy in which the preroga,ives of
the Federal Government are confined to objects of
general or external character, whilst "the powers not
Note in l829.-In proof of the view above pre-
sened reference may be had to the vibrations of spe
Gle during the era of suspension At times the Span
ish dollar, worth but four shings and three pence in
gold, merely stamped and thereby made Bank token,
would pass for six shings; and the guinea for TWEEN
tweght, being an appreciation paper of thirty
three and one third per cen.um At other times bills
on England sustained, in the commercial cities OF the
United States premium of twenty per centrum and