The Madisonian. [volume] (Washington City [D.C.]) 1837-1845, 1841-04-17


The institutions means and credit Admitting that it
was expedent or within the legitimate powers of
the Bank to engage in the purchase and sale OF mer-
chandise to invest funds directly in it. the personal
integrity of the officers who sanctioned il must remain
unmpeached AZ far the transactions in question are
concerned iii be shown that the Directors sanctioned
the proposition and that the Bank alone was benefited
by the operation as had been designed. We most
earnestly hope that Mr. Bddles letter will dssipate
many doubts and clear path to full and just appre
citation of the whole subject. is matter of sincere
regret that on either part any expression should be
used which may detract from perfectly temperate
consdei alton Of the points in dispute The contro-
versy has but commenced. It will evidently be long
and laborious one. As we have always respected in
common with the public the gentlemen engaged on
both sides of the question: and entertain feelings OF
personal regard towards many Of them, we are the
more anxious for deliberate survey Of the whole
matter, and trust that it may result in removing
the odium under which this city rests Though the
cast upon many conspicuous persons who have
enjoyed very high trusts and confidence at home and
ANpALUslA, Bucks County,}
April 8, l841.
Hon. John M Clayton, Doper, Delarare:
My Dear Sir-Durng your late visit to Philadel-
phia, you were good enough TO express your opinion
late meeting Of the Stockholders of the Bank of the
United States For sixteen years had been the Pres
dent Of that institution which up to the hour lett
enjoyed long of prosperity. Two years alter
desire fthose now connected with it to ascribe all its
misfortunes, including the fatal resumption few
weeks ago. entirely to my administration. Had this
been done in fair and open and manly way, no one
would have been ready than myself to meet that
question. But instead ofthis, what was the course
pursued A committee of stockholders has been
for three months at work with all the books and papers
Of the Bank under their control, raking up every
tion or revenge their personal gries, pander
to the morbid appetite which prevails abroad about
banks and those connected with them. From all COM
munication with that iDquisitoria body was studi
ously excluded and ! understand that proposal to
invite my attendance TO apprize me of what they
were doing, was rejected. They ended at last by
porting expare and partial statements in regard to my
self, and, You saw at the meeting no opportunity
was given to let the accused be heard before be was
condemned, and the report is widely circulated with
an air Of official authority in distant places where no
explanation efmine can ever follow it. Now all this
seems TO me signal act of injustice. know that
misfortune has right to be querulous but this
summary condemnation without chance ofexplana-
ton, or defence, privilege never denied to the
humbest criminal cannot fail 70 be regretted by
those who have joined in i when the passion Of the
moment shall subside. deeply regret it-less my
own account however, than because think such an
act Of injustice incts injury the Bank IL
self regret il still because although separated
from the Bank felt sincere interest in its fate and
had prepared with great industry what deemed the
means Of reyiving its prosperity which meantto sub
NIT to the stockholders
All that ofcourse is over now. But as know you
DESTROYS of ascertaning the truth shall proceed
to explain to you as personal friend several matters,
very simple in themselves but which have been strange
~ mirepresented. For instance
You heard in the report long and complicated story
about cotton purchases and it is often said that
MANY begin to believe itthat the Bank of the United
States speculated largely in cotton, and lost great
deal Of money by it. 1t seems unkind to disturb SO
established fact-but the truth is, that during my
connection with the Bank, it never owned bale of
cotton--and will not believe lose dollar by any
operation in cotton, unless by great acknowledgement
hereafter. That whole matter has been to source
of much PRIDE from its benefits to the Bank and to
the country that take pleasure in stating the real
history fit.
In the year 1897 the Bank went to the relief of the
city of New York, by issuing its bonds payable in
London. The question was how to provide the
of paying those bonds. Hitherto the only mode
Of doing It by the purchase of bills drawn at the
South on shipments Of pioduce-bu but the difficulty
that in the general prostraton of credit at
the South there was great danger in taking private
bills drawn therewhe many Of the Liverpool houses
on whom these bills were usually drawn were them
selves embarrassed 1t occurred to me- therefore, that
the only mode Of avoiding these dangers to pur-
chase no bills at ALL except founded on direct ship
ments Of produce under the control of the Bank. l
accordingly urged the mercantile part of the Directors
TO engage in that operation finding none Of them
disposed to large operations, determined that as It
must be done would do it myself. accordingly re-
quested Messrs. Bevan and Humphreys to carry out
the PLAN which simply to let their Agents at the
South draw on them domestic bills, for which they
would receive the notes of the Bank purchase the
duce and send it to France and England; then as
their domestic bills came to maturity in Philadelphia,
to pay the Bank, by sterling bills on the houses in
England and France to whom the produce was sent,
and by whom it was sold. This was the whole ope-
ration which lasted from the summer Of 1887 to the
fall Of 1888 Il undertaken without the least idea
of any pecunary advantage and the only understand
ing that subject was verbal assurance from
msthAf if after repaying these advances to the Bank
there should be any excess the Bank could by its
charter buy this produce of course take any profits
arising from it, such excess should be given to those
who encountered the trouble and the responsibility.
Nor there the slightest desire to conceal it, On
the contrary all the correspondence and entries be-
licve passed through the Bank--it was announced
over and over again in publications known to come
from the Bank-and il was particularly described in a
published letter Of mine to Mr.. Adams the 10th Of
December, 1888, Of which the following is an ex-
tract
In like manner the arrangement Of the currency
placed the staples Of the South entirely at the
Of the foreign purchaser who could have dictated the
terms of sale TO the FRUSTRATED planter was thought
proper to avert that evil by employing large portion
Of the capital Of the Bank in making advances on
Southern produce. This had two effects The first was
to provide rsmttances pay its own bonds in England
issued to New York merchants in their extreme dis
tress for the Bank could not purchase these staples
Il made advances upon them in the South receiving in
exchange bills on Earope-the second was to intro
duce into the market competition and thus pre-
vent the unconditional subsection Of the planter to the
foreign purchaser, These advances were made not
in past years the personal security Of the
chants which the confusion of all private credit would
have rendered too baxardousbut the actual ship
ment Of the produce 70 an American House in Eng
land willing and able to protect American property