The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1850-01-21
TWO CENTS.


/
| ine recent Developments made, showing the
| lfauuulsht management of the State Bank at Nor
i, ,hs, ana other similar institutions in other States Of
tne Union, very naturally suggests the uroprietv of
directing pubic attention 10 our own system of
banking Wv" '''''"' "
| The great bank charter Of tins State is the gens-
| raj banking law of 1888 The people have wisely
| adopted II in the constitution The old SAFE
~ iund banks are wheeling into line as rapidly as
| Their charters expire. Ii cannot be desned ioop-
perfume, while the ban of our nelghborng States
| are breaking down and running hundreds and thou
SANDS, 10 suggest what we deem important features
| In our system. The great conservative principle
when, tor tweHfy years, has upheld, and st sus-
,ans, the safe and healthy action of our system ls
he stern mandate of our law, that no bark shall
ssue negotiable paper payable on time" Our policy
mas oetn TO eradlcae the perDlcioas post noge sys-
tenn. AS early as ls29, the issue by banks os anv
bill eg note not payable demand without nteresf
was positively prohibited. Here lies the safety of
The stakeholder and TIE public. If our courts bya
manly and firm tone, administer this law, and our
legislature do not sweIVe in maintaining II upon
The statute book. we are sale from bank explosions
II the genial influence OF judicial exposition shall
hannonlze with the intention of the legislative
power, there Will be C9nilIct IN practice, and
thereon the sights end interests of the stockholders
can securely repose. Let no evasion of tals law
by the banks OF this State, occur and the bi.lhoder
and the stockAoder will be cafe. The prohibition
OF promises TO pay at future day, and the obhga-
ton TO pay on demand, without interest, prevents
running into debt-represses the sprt OF speculation
and wild schemes. There can be no purchases In
ordinate dealing in exchange. In 1888 this great
principle re-enacted, with additional guards for
the security OF the blll-hoder. Under this law
issue of notes, unless payable on demand, and
secured by pledge of State stocks, can be issued
by any bank. Under the idea of dealing in bills
a exchange, the free banks, in 1889 attempted an
evasion OF this law by Issuing exchange. payable
al a future day Our late Supreme Court held
such Issues illegal, and that corporations under
the general banking law were prohibited by the
restraining acts from issuing any note not regis
xyifb he rol In n0 "A
s8lutsry doctrine, and 10 give 1t a more efli-
caclous effect the act OF the lith Of May, 1910,
declared the issue OF notes or post bills misde-
meanor, punishable by fine and lmpr,solment.
Both systems (he free and sa!ety fund) are
chalbed down by legislative enactmen,s aud Judl-
cal decisions. issue OF bills aud notes, aud evi-
dences Of debt, payable only on demand In this
one great principle lies our safety. The history
of the Pennsylvania Bank oi the United States
iurnishes an Impressive commentary upon the evils
and disasrrous Effects of the post note system.
That bank borrowed money IN every State Of ths
Union. and In al parts Of Europe, upon ITS enor-
nous issue Ci poet notes and post oiili, uut ITS
mansgeIssnnka capital Of S35, 100000, aud brought
disaster and run noon IT'S creditors and stOckhOd-
efs We venture the assertion, without the tear
ci truthful contradiction, that IN every instance of
G'sa.irons bank failure, disclosure OF its affairs
hcs exhibited II borrowing beCgar, upon an issue
ol premises "a ply on time. Oar true policy re-
quircs that our courts should conlme all our bArAs
v ihiu theiT limited powers, the salutary restraints
a. thsir charters, and the general banking law
n the penal aud pFohibory statutes shall be admin
i,tsred without 'irar, favor Affection the hope
a reward" md are enforced as well against all
who issue, a. against all who receive, spurious
currency Of poet notes and post bills, this State
may ho,e 90 erJoy as safe a currency as any peo-
PIE on the face Of the earth
an notes issued IN cnn'rayenilon of the law OF
lSto are absolutely void IN the hanss Of an inRo-
cent holder. and our courts have and must conu-
nue. 20 10 pronounce th.ln. There 10 no real, but
Gully an apparent, hardship IN tnis. IL the holder
could successfully urge his lgnorancc and inno-
crnce in hrs favor. thelaw never could be enforce
ed Banks will eyade the laws, II they can had
any one to hep them. by such Issues, u CONS its
credit, and derives a revenue from forbiddea
source lie who takes such forbidden paper gives
AID. encouragement, and countensnce, 10 the Ille-
eel act and ID - answer to say he did II inno-
Gently A bank bill u treated as money-it Is not
monsy OF moneys worth. unlsss Il can be, on de-
mand, converted into gold or silver, at the will OF
the holder A Judicious and sound system of
banking demands 1.-THE law awards It, aud tho
courts 81 this State are bound To enforce IL, how
ever hard the penalty, or severe the loss.
The laboring classes are always the greatest sui
f,rers hy their faiures-the incapable OF Judg-
ing of the soundness of our bsnks-they look to
The goysInmsni for pro;ectlon-they can Only be
rois cied by just administration OF the laws.