Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1842-02-19

i
Chairman ofhe Committee on B"nhs
r,y,;es 10 de Jaterrosotortes IF The RGnh Committee
B,xk OF VIRGINIA, Feb. 4, loIe
lori iioILEMAS, Esq,
'''" chni,man Of Tie Committee on Banks,
OF The House ii Delegates.
Gin, In reply to the Undergraduates prnpounded TO
oa hr vonr Com,ntlce on the 2Sth nt beg leave to
submit the following answers, which the brief intervals
f o,her pressing duties have enabled ME to prepare
| Answer 10 the first Interrogatory
/ am unable 10 form an estimate OF Inc probable
ononn of the circulation of the Banks OF Virginia IN
lie cites Of New York, Philadelphia, and Baltimore
In renlv TO applications for ln!omniion the amount IN
The c,tv of Baltimore has been varionsy estimated al
from 100 600 TO 500, goo dollars.
The general complaint Of the scarcity OF money
,brourbout this State, with the circulation of our
tanks not materially reduced for the last twelve
months leads me TO conclude that larger proportion
or ,his circulation than usual has gone into other
States and the depreciation OF the paper oil The Nr
,no Banks in the Northern cities has doubtless arisen
from an undue accumulation OF II at those points, whit
Their il has been RENTED from various parts oil the
country as medium OF exchange
8 Answer to the second lnterrogatory.
Whenever the notes ofour banks, by resumption shall
he raised 10 the standard Of gold and silver they will
10 be used for ordinary circulation IN DINER States
and the amount abroad will probably be returned for
dsmrtion through the Northera cities. Our circulation
therefore would have he reduced at least tothe
REQUIRED for a circulating medium
! Answer 10 the third lnicnogatory,
III correctly understand this question, am not pre-
narcd 10 saw tina, ans additional demand (heyond pre-
zen, liability abroad) would likely he made upon the
hanks Of Virginia from The Northern cities in Of
sumption unless tie notes now circulating within the
State were bought up aud substituted win paper eur
rncy of lower value iii order draw our specie for
norta,ion BIZ such process The demand might III i
Short time reach nearly the amount Of our entire crcnla
hon.
/ To The fourth lncrrogaory.
am unable 10 give answer al all satisfactory.
!, Answer 10 the filth lntcrrogaoIy.
concur in the opinion generally entertained, that
the balance of trade s to considerable extent, IN Ia
vor of the North against Virginia and as Richmond IS
The principal medium of this trade, 1t IS probable mat
this city is more largely indebted than any other in n.
onia to the Northern cties-as, in turn, The country IS
more indebted TO Richmond than TO any other OF her
s;sier towns in the State The amount OF domestic IN
dehtedness 10 Richmond, from estimate lately made
o,ust vastly exceed her indebtedness abroad
Rnt although this balance Of trade against Firg
mav in considerable degree have resulted from an
excess of our purchases over our sales at the Norh
other causes besides the direct trade have affected the
rates of exchange. The Northern cities ESPECIALLY v
York; have become the settling points tor our COM
merce with Europe and the distant States of the
South and West, In payment Of the interest on our
Stale and various corporation loans abroad, well
for large portion of our purchases OF Western pork
and Southern sugars, periodical transfer OF funds IS
required to be made TO those cities They thus become
the recipients and repositories OF large sums OF money
from every portion of the West and South, SO that the
balance of debt may be preserved in their favor with any
Of these tributary States without any advantage over
her in the mere exchange Of commodities
Another cause affecting our exchanges may arise, in
nv opinion from the fact, that the banks OF this State
now keep larger amount OF specie IN their own vaults
in proportion 10 their crcuation than formerly. In
Ill few years past, they were content to leave large
cash balances in the Northern cities, creeping at home
smaller supply of con which enabled them better to
REGULATE the exchanges well TO secure greater ia
yor towards their notes III the Northern cities. In
seeking TO avoid discrcdt at home by augmentng that
most Ineligible security for their notes-namey spe
ce-,bey have impaired their credit at the North BY
no, keeping there the of redeeming them This
view might be illustrated more fully If did not sup
pose the committee will prefer brevty in these an
swers.
6. ! Answer 10 the sixth and seventh Interrogato
res.
The balance of debt being against the Virg inia
Banks il would seem that the cooperation othe banks
of Baltimore and Phade phia would not furnish US
with any additional means Of meeting the demands
which resumption would bring This IL certainly
true And TO the extent of our liabilities in those cities
our banks would be called more promptly for pay
ment to the banks of those cities than il their resunp-
ton were postponed TO later period. Bot whilst the
coemporaneous action in this matter OF the States with
which we are in immediate contact-say \. Carolina,
MARYLAND and
state of our accounts relieve from the payment Of
our notes and balances out ~ the State Il would better
enable us keep aoat the circulation which constitutes
our domestic currency. For, as have already lnti-
mated unless those States resume at the same tme or
nnlcss il be practicable exclude the i'll this State
&c the notes Of SUSPENDED banks elsewhere, the banks
Of Virginia would he called on, in the course OF com
oaraiiyely short tme for payment OF all their noies,
bv RAISING them 10 higher standard OF value than some
other admissible currency.
This position was illustrated by the events of our last
resumption During the two months Of February and
March. 1871, the Banks Of Richmond pnd their notes
in gold and silver while the States have named were
suspended The Bank of Virginia at Richmond, re-
deemed in specie and other cash funds, within that
brief period S22l S20 about one-fourtl OF It's Whole
circulation-an amount which must greatly have e1-
ceeded it's foreign circulation at The lime OF resumption
During this proceeding these notes we're bought up al
premium equal 10 that gold and silver in the ada
cent suspended States, and consequently they disaP
peared from ordinary circulation.
TIE amount thus returned and redeemed by one de-
parmen, of this Bank within two months after its last
resumption gives the best data can furnish Of the cur
ta;lment of lis business which present resumption,
,rihout the cooperation Of The neghborng States,
would require.
| believe that the Banks of Virginia will, as mea-
sure necessary their credit and utility, resume
whenever those OF Pennsylvania, Maryland and North
Carolina shall concur. 1.-THE earliest day at which
such resumption ought to take place. depends events
which crnnot foresee. mean the ability of the conf
munty 10 such demands for their debts must be
enforced by the banks in order 10 enable them to main
tain resumption. To what extent the country may be
prepared for these payments, either now or after the
crops of the approaching season can be realized, your
committee can well Judge rs any bank officer
The class of debts due to this Bank, which II is most
desirable TO call in is the old accommodation debt !;
and, this, curtament Of five per cent Veryslxty
DAYS commencing on the first Of pr next, and con-
tinung until each debt shall be fall paid off, has been
already ordered by the Board Of Directors. But in ad-
don to this curtument Of the accommodation notes,
fear that the decline of public confidence will force
the banks 10 contract their business in other respects,
and discount commercial paper more sparngly, when
ever another resumption ia attempted The exact
rate and intervals of This reduction must be governed
much BY the state Of things at the time, that should
be loss suggest in anticipation, any precise rule
With proportion Of specie on hand, much larger than
the banks found il necessary TO hold during cash pay
meu,s in former years, the present panic serves to
sl,ew, that whilst public confidence is 50 much weak
ened, they will he unable 10 sustain circulation
much exceeding their immediate cash resources