The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1847-09-18


r text for the truth Of the above remark.
3 1t is true, there are some bungling reg
: ulations concerning loans to directors
3 and stockholders, but they are inef1ec'
+, tual, and were, probably, so intended
! to be. If the directors cannot borrow
enough of their own branch, all they
have to do is to apply to neighboring
: branch, and by an exchange Of this kind
I they may borrow without Imitation
t This mode of evasion seems to be de.
, signedly provided BY the Legislature;
for in the case of the independent bank.
. ing companies there is no Limitation on
: loans to Directors except such as the
) stockholders choose to impose. We
venture to say that this vice is radical
and will one day or other produce its
natural consequences, the death OF the
body corporate. To those acquainted
with banking principles, it bodes and
imports that the banks concerned are
mere borrowing machines, mere swind
ling shops set up BY needy adventurers
to facilitate loans to themselves and
their favorites. A bank director whose
capital is solid, has neither necessity
nor inclination to borrow. Why should
he borrow: He processes to be lend
er of the largest caibre!!! The reser.
vaton Of such privilege is to the last
degree dangerous, as it enables the
same man TO occupy the inconsistent
relations of debtor and creditor TO him
self! The indie btedness of bank direc.
tors to their own, and to affiliated nsti-
tutions, is upon true commercial princi-
Piles as little tolerable as lewdness in
woman.
These Banks are authorized to issue
notes of the smallest denomination even
down tn one dollar. The only incoh-
venience attaching to metal money is
its great weight and bulk. This cir
cumstance sometimes renders apaper
medium desirab BILE, where large value is
represented, on account fits lightness
and easy transmissibiIity. The price
of good horse in silver coin is incon-
venientto be carried abeut mans per-
son. The price Of a large plantation
in this same metal will require wagon
and team for its transport. This shows
by the way that Matmetal is not scarce,
if scarce its value would become more
intense.
Then what becomes Of the whig ar.
gument that it is necessary to issue
notes in order to increase the volume
of the currency, or to make money plen-
ty. Money is never scarce, but in con-
sequence ofimprovident legislation.--
"lI is one Of the greatest humbugs"
says Gen eral Jackson, sever attempted
to be imposed upon people, thar there
is not specie enough in the world to an
swer all the necessary purposes of
But the amount Of metallic money
by a small bank note can
be carried about the person without in
convenience. These things, therefore,
do not remedy any defect of the coins,
which have no defect as a medium of
circulation except their weight. Tie
issue of these notes seems to be mere
wanton exercise ofpo ower, condemned as
much by true commercial, as by sound
political principles. These little notes
are the guilty agents Of nearly all the
bank expansions, and consequent re-
vulsions and contractions, which have
afflicted our people. They drive out
the coins, which will not circulate in
company with them. They enable the
banks to over issue. They fill up all
the channels of trade, even the minu-
test. They enable the banks to inter-
fere in the smallest dealings of individ-
uals. They occasion plethora in the
currency. We protest we cannot per-
ceive how an expansion Of the curren.
cy could take place without the inter-
vention of small notes. But suppose
we are mistaken, suppose it possible to
create an undue expansion of the cur
rency in the absence Of small notes.;
the consequent contraction and revul-
sion would not reach every cabin door
in the wilderness, as at present. The
tempest would howl in the upper at.
without reaching the surface {
of the earth. The community suppl. {
ed with their ordinary medium of ex- {
change in the shape Of coin would
scarcely know that revulsion existed.
This difficulty would be met and en- ,
countered by those whose business {
habits and experience would best ena-
BILE them to meet it; and the amount of t
coin in community would be the best c
means Of mitigating the calamity. This t
privilege fraught as it is with mischief a
to the community, is probably the very c
last which our Ohio Bankers will re.
inquish. For very many of them are J
not solid capitalists, but nee1y adven. P
lursrs, who wish to set up borrowing d