The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1842-01-31
Charleston.
Correspondence of the Herald.

CHAMELEON, Jan. %, 1872.
Banking in Georgia and alabama Singular More
ments.
Having just arrived from long trip through
Georgia and Alabama, and believing that the stu
alton Of the two States 10 not understood, think
it the duty of every business man to try and cor
rect the abuses that exist in both States, by pub
fishing to the country the peculiar position they
both IN, and how the evil can be corrected.
In Georgia,l the Banks, in the eastern part of the
State, including Savannah, resumed specie pay
ments early in autumn at the same time the
merchants refused to receive any bank notes that
were not convertible, in the equivalent 10 coin, at
par. The effect was to introduce into circulation
agood, convertible currency, and as the planters
sold their cotton they received in payment notes
that enabled the country merchant to make his
payments without loss in exchange This course
has been strictly adhered to at Augusta and Savan
nah. In Macon, the second interior cotton mar
kst, they attempted TO do the same thing The
Commercial Bank aud the Ocmulgee paid out their
notes to the cotton buyers believing the merchants
would repudiate the unsound currency for a few
days swered but the business of the place being
in the hands, with few exceptions, of men who pay
no attention to contracts was not carried out, and
they are now palming Oft, in payment of debt, the
notes Of banks that do not redeem them, and are at
discount of 10 to 10 per cent.
AS you 60 west, aud reach Columbus, the con-
dition Of the merchants, suffering under depre-
ciated currency, is truly lamentabe, and when you
are informed this state Of things is produced by
three or four individuals, and the leading men i
the town, you will be surprised. The difficulty
lies IN nut SHE'LL and the evil will soon itself:
it was produced by the Planters and Mechanics
Bank, or, should say, by General McDousal, the
President, very excellent and worthy man.
Some five years since, when land buying com
menced in Alabama, many of the citizens of
Columbus were engaged in it, and the General
became large purchaser, to the amount of some
one hundred and fifty thousand dollars, at the same
time, and has continued to the last season. to oper
ate largely in cotton. These operations were on so
large scale that he soon required bank, and
was placed at the head of the Planters and Me-
chanics'. Up to last year he succeeded in keeping
it afoat; but As his large landed property in Alaba
ma became unsaleable, and the re.lama ions in cot
ton themselves, and the funds of the bank
being exhausted, he retired from the Presidency,
owing the bank one hundred and sixty thousand
dollars.
Mr.. Banks succeeded him, very good appoint
msnt, but he found the assets so unavailable that
he could not get the bank in a situation that APP
peared satisfactory, and resigned. General Wat
son appointed in his place he is of the MeDou
gal school, and owes the bank sixty thousand dol
lars THIS debt was created under Nc Douglas ad.
ministration.
These operators have forced upon the commu-
nifty the bills of this bank upwards oftwo hundred
assistance of the Bank of Columbus, have induced
the people to receive them as good funds. This
could not have been done excepting with the as.
sistance Of the Bank of Columbus, who, on these
MT nod - nAHa E.,A
having large amount on deposit, and not being
able to borrow money from any quarter, excepting
the notes Of the broken bank planters and Me-
chanics', they commenced at late date receiving
them and paying them OUT and the poor depositors,
who deposited good money in October, are COM
PEELED to receive, in January, currency dcpreca-
ted thirty per cent.
Many meetings have been called; and, on Satur
day, attempt was to be made to tear the building
down. The course the Bank Of Columbus pursues
cannot be tolerated; it arises from inability not
having available means; and they should be imme'
diateIy forced into liquidation with their colleague
McDougal is new President Of the Insurance Bank,
lately purchased from the Bank of the United
States; the purchase was made by DR.. Collins, of
Macon. He sold the bank to McDougal for sixty
thousand dollars profit. Fortunately for the COM
munity, the directors Of the bank, hearing it was
going out of their hands, destroyed all the bills;
and when the purchasers came in possession, they
found they would have to make a new issue; and
as McDOugaPs name was valuable at the Plan
ters' and Mechanics, he, like prudent general,
has not yet entered the field, and is holding him
self up for a coup de main. The destroying the
bills, is quite unfortunate for Collins, as McDougal
refuses to pay him the amount originally fixed, as
the contract included assets, and particularly the
circulating notes, which, under the former admin
istration. stood well, having always been paid in
specie on presen alton; and he would have had but
little difficulty in getting them in circulation, by
this 1eans giving him some means to operate.
The other Bank in Columbus is the Phoenix, a
vamped up concern, under a new name, without
capital. Its circulation is small, and primo ipally
in checks, representing on the face, being da-
ted lola. Florida, aud payable at Phoenix Bank,
in currency, which is Planters and Mechanics.
The head of the bank is dealer from Mlledgeville,
Georgia.
The sound Bank Of Columbus is the Insurance
and Trust Company, Mr.. Cooper, President, lately
elected member OF Congress. They do their busi-
ness correctly, and have real capital
will finish this subject in few days, and give
you data for every thing l assert; and remain,
yours, &C., X.