The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1852-04-01


might be ever preserved and oementod by The per-
feet union Of the brethren of every elmo aud
country
The New Banking system OF France.
From The London Times March III
Among the causes which produce and perpotuate
the instability Of social and political institutions Of
France we have often had occasion to romark that
the condition Of landed property in that country is
0na Of the most active and pernicious. The rapid
subdivision of estates, and the still rspid accu
mutation Of encumbrances the land, have, in two
generations, produced state OF things
to the landed interest than has ever before been
witnessed in the communities Of Europe which have
not undergone revolutionary changes. The power
and influence iDseparably attached to the posses
sion and occupation of land, have beon frittered
away depressed in tho samo proportion and if we
SEQ tho entire rural population subscribe with
enthusiasm to the extinction of their Liberties. the
partly to be traced to the vague hope that
absolute government may do something towards
the relief OF their private ombarrassments. 1t has
been finely, though bitterly remarked by recent
French writer, that the lowest system of govern
aren't which be inflicted by Providence upon the
sins Of nation, is that of authority wth0u. dig
nifty and without limits over people which obeys
without conditions but without respect. Such
state OF things can only be introduced ard cstab-
ished when landed property, which is the great
bulwark of independence is itself dependent or
poweress; for all experience and demonstrate
that the stability Of laws and the maintenance OF
free institutions require the support of an teligent
The experiment Of land banks, or real property
dit which has just been established by decree
of Louis Napoleon, is an attempt to find some re-
mody Tor the most pressing Of these evils. II will
probably prove imperative, from the known repng
nance Of French capitalists to embark joint stock
undertakings; for, as NJ. Molten remarked many
years ago, territorial banks are n harmless dcluson
long they find neither capital for their shares
nor credit for their paper But, in fairness to the
French government, ii must be observed that this
plan has been for several years under consideration
that II has been studied and il recommended by
certain class of economists and that it is copied
from similar institutions which have existed and
fcurished for moro than half century in Prussia.
Hanover, and some other parts of Germany. The
scheme OF joint stock mortgage companies was origi
naly invented by Berlin merchant named Buring
for the relief Of the landowners in the province Of
Silesia soon after it had been conquered by Frede
rick H.; and the paper currency OF these companies,
bearing five or six per cent interest, has passed graz
dually into circulation, and has been adopted by
tho habits of the people. The principle Of
adding q charge in the nature Of sink
ing fund, to the interest Of the loan, was first
adopted By the company founded at Zollc, under
the auspices Of King George lu., and perhaps
originated in tho financial projects OF DR.. Price
But. however this may be, the same principle has
since been introduced elsewhere. There are now
about forty Of these companies in Germany. Boil
GUM, and Gacia, and the circulation Of their
land notes bearing interest il estimated mt about
twenty-five millions sterling. Within such limits,
and with skiliul management. VIC do not contest
fHstt sNcH may nave proved usClul TO
borrowers and to lenders. IN fact. small scale,
they may be compared to the loan societies existing
in this country, and or large scale to the advances
OF our own government for public works and agri-
cultural improvements. But the popularity Of the
measure now proposed in France is the suggested
Issue Of n new species Of paper money among
people singularly ayerso to that form of currency
On all these questions asmuch depends ON the con-
fdencc of the public as the real mechanism Of the
enterprise. If the system Of Scotch banking were
not in full uDd successful operation, no one would
venture, q Yriml, TO recommend it. And in France
any scheme based on an issue Of paper has TO en-
counter the rccolections of G. national bankruptcy.
aud all the most nyeterae prejudices Of the people,
We mentioned, the other day, that tho actual
amount OF mortgage encumbrances existing III
France was very differently estimated M Theirs
took il as low ~ four mlliards and half, or $50
millions sterling; the M0atspr places it at eight
mlards; M. Cochut computes it at ten mliards, Or
100 millions sterling. We inclined to think t'iis
last estimate is not beyond tho mark: but, as NJ.
Cochut computes the rate Of interest rather lover
than the other authorities, he with them in
aotting about sE25 900 COO sterling per ennum TO
tho payment Of interest. 1t is supposed that about
onc-third Of this vast sum is money actually bor-
rowcd on mortgage, at eight or nine Per cent. The
other twotl,irds are charges remaining property
at Eve per cont interest to the balance sales
Of land. This circumstance probably accounts in
part for the astonishincly rapid augment alton of
these burdens on land. Nbo registered amount Of
mortgages in France was S,Sh4 millions in 1920,
J. ,235 millions in 1882, i2,5ii millions in 1910. and
VI probably exceeds fourteen nlllArdS III IsOS. IDe
progress Of this 10 have been ut tho rate
Of upwards Of four millions sterling per annum Cor
some years. 1t Is ascertaincd, moreover, by the
registration Of transfers, that the sales Of land and
OF standing crops in France amount to 800 M Hons
Of francs annually that tho whole value Of tho
land and houses of the country may be said to
change hands once in forty eight years or to speak
more accurately, that portion OF the soil which is
most subdiviaed is in constant state Of hucpaton
and Of increasing onouinbrance. Moreover, these
calculations do not include the transfers and loans
which are Of so small amount as TO render II adj
visablo TO svade the legal lormalities altogether
These charges, then, amount to an annual burden
on The French landowners nearly equal to the in
terost of the national dobt Of England and nearly
double tho capital Of the national debt OF France
To deal with such colossal liabilities, and oven to
effect perceptbe reduction in tho rute OF interest
on such sum, ia obviously tar beyond the power OF
such companies as the ao decroo proposes to create
The whole circulating capital Of the land banks OF
Germany, after halfa-ceDury's experience, is less
than one-twentieth part of the mortgage debt of
Franco and tho ratio of interest, high ~ il would
to DO on this species of investment, is owl
IDENTIFY kept up by tho Immense desaand for capital
The Bank of France has lowered its rate ofdscounts
to three per cont, and the same accommodation
heretofore granted upon the government securities
will now al be granted to railway property But