Indiana State sentinel. [volume] (Indianapolis) 1841-1853, 1852-12-30
SATURDAY. MoRNINc, DEC. as, 1sse.
The New Rapl,;ny svstem

of business and, fact it will be almost impossible to
get along without banks.
Experience has shown the State Bank of Indiana to
be superior to that of any other II has been well and
prudeRtly managed and has furnished the people with
safe circulating medium to the extent Of its ability
The fast increasing population and business of the
State, It was contended demanded increase of bank
ing facilities.
Two years ago, a Convention assembled to form a
new Constitution A provision inserted in that
Constitution, authorizing the passage of general
banking law, ," and also the establishment of ss bank
with branches, under certain restrictions. The banks
to be established under the general banking lsw are
compelled to file with the Auditor, State bonds the
the redemption of their hills Should act pass au-
thorzing bank with branches the Legislature is
not bound to require collateral security.
The Constitution, containing these provisions, was
submitted the people, who adopted il by over eighty
thousand majority The Legislature, its last ses-
sion passed general banking law, guarded in the
opinion of those who formed it, as protect the bill.
holder against all loss
The Democratic party had a large majority in the
Convention that created the power In the Constitution
and in the Legislature that enacted the law So far,
then, party considerations go 1t is Democratic
stitution This being true II is with little surprise
that notice the effort OF the State Sentinel to preju
dice the minds of the people against the banks which
have been established under the general law" Its
is ucfair and unjust toward those who have
tered into business under this law Time, least,
should be given them test the system. 1t may be
that experience may suggest wholesome amendments
to the law, and they will then no doubt be made.
1t is said that in several instances, banks have been
established by gentlemen living In the city OF New
York. and that they put their bills into circulation in
that city. This may be true, and know of way
to prevent il do that lnu ured by it.
They get dollar that they do first
by the deposit of State stocks They bound 70 keep
an Office at the place where their bank is established,
for the redemption of their bills failure to do so
would forfeit the stock in the hands of the Auditor OF
Stae who would be authorized to sell it, for the bene
g. +ko bolJ Tbac inf hap
ject taxation, and the State, this extent is bene
fitted by their establishment. Other banks, however
have been established for the purpose Of doing the local
business of the country and we want to see the
pertinent fairly made to their capsbility of afOrdng
sound and safe currency.
The above, which we extract from the Indiana Jour
nal of the 23d calls for brief notice from US The
bill authorizing free banking adopted by par
ty vote This fact is well known, and one under
stands it better than the editor Of the Journal In the
Senate three Wing and fifteen Democratic Senator'S, and
in the House four Wings and twenty-five Democrats
voted against the bill This evidence puts TO rest for
ever, the assertion of the Journal that it is Demo
cratic institution" The measure was sustained by men
of both parties For part having always been op-
posed to all banks of issue, opposed the passage Of
the The arguments used in support of free
banFing in Indiana, frst that the State Bank,
which has always been safe, sound, and well menaged
institution, did not afford sufficient accommodations for
the increasing demands and of the country.
Second. That these banks being secured by the de-
pos of State Government stocks pledge for tho
redemption of the bills they would always afford safe
and sound circulating medium and supply the wants of
the country.
Without attempting TO controvert the positions
sumed by the friends of the system, which were
the arguments that induced many to favor the policy
let examine the workings of the system as far as it
has been tested Up to this time the following banks
have been established:
NAME BANK. NAME OF PPAcE. CAPITAL.
Bank Of Connersville Connersville, .S300O
State Stock Bank Of Ind >. Peru, ....... 200 900
Government Stock Bank. Lafayette, ....... $4,000
Plymouth Bank, plymouth .... $4,000
State Stock Bank, ,...... .Logansi ort 100000
Prairie City Bank. 1erre Haute,. 100000
Traders Bank,. Terre Halte, 100000
Public Stock Baak, ,....... Newport. 200
Bank of North America. Newport, ........ 10000
Merchants Bank, .Terre Haute, ,..... 5000
Wabash Valley Bank, .Logansport, ...... 100000
Indiana Stock Bank, Laporte, ........ $4,000
Gramercy Bank, Lafayette, 100 900
Bank Of Evansville, .... Evansville ..... 100000
Total Bank Cap al l...................Sl 81 ZOO 900
OF these banks there is in which majority of
the stock is not owned and controlled by foreigners.
The Bank of Connersyille the Wabash Valley Bank
at Logansport, and the Prairie City Bank at Terre
Haute have officers and local directories The others
owned and controlled entirely by nonresdents ofthe
State and what worse in the hands of the most
desperate stock gamblers and brokers in the country
The money purports be issued here, and bears the
genuine signature of the Auditor and Register whilst
the notes filed up and signed and issued from some
banking house in the east and not intended for cir
cuation here We have now nearly two millions added
to our bank capitol, whilst hundred thousand
dollars of the bills issued intended for circulation in
the State. In place of it have Connecticut Massa
usetts, and New York money in abundance. Notes
on banks that the people know nothing about. The
evil is increasing, and will continue to increase the
free banks multiply. A broker in New York procures
his bonds, comes with his plates and bills struck,
complies with the law takes his notes back and makes
arrangement for their redemption in New York one
per cent. discount. He then furnishes the funds and
shaves his paper. The bank is located some
he-way and obscure country village, that the
mid summer, hid in the thick foliage of the dog fen
ne imson and iron weed far of travel trade and
commerce. The banking office in the dog. g.fenneI town
is grocery where ginger cake and ginger Pop
sold. The bill holder will have as leng search to find
its location, Stephens the traveller, had find tho
governments of Central America. When it is found it
will be found without means for the redemption Of its
issues. The bank is broken. The law gives the rotten
L. Tho