Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1852-01-30


.a alas :i.c!.so::cJ 2vGciudo ;!s Ike Indications
te coirT,Jrca! world po::cnded approaching nanciu
pressure This conviction rendered them douoy anxious
secure, at as early date possible, whilst
abundant oil the requisite Tor public purposes nG
tie year The result has shown the Of
suppOsons and that their pomptness fortunate
beyond what :hey themselves anticipated. The pre-
prevailing has nccasioned considerable embarras
r the commercial affairs OF the country. IL has inn osed
upon the banks the necessity both OF refusing gre:
TINT discounts paper offered at their counters and OF
curtaing their discounts already granted rapidly han
il customary In !he midst of this financial enl5arraS
large demands upon the treasury for the liquidation OF
upon Stale debt The law had set aside pe-
cic of money for this purpose but made II SIMPLY
charge upon the treasury The the treasury were
sufficient pay off the interest," and other were 10
b. rcsor,ei In of any temporary Of money
The law directed treasurer with the sanction OF the Gov
cnor borrow for short ine from the banks such means
necessary for the absolute purposes OF government
Bat such the PRESSURE that the banks found II extreme
announcement advance comparatively small sums
ard would have been compelled either refuse the State
the very large che requcd else 10 have srani e
accommodation u, the ruin perhaps OF many th" ana
deserving business men Of tie community. The or
rlagemans hereafter stated, which were entered into
By the BuI enabled them 10 pay the interest upon the
State debt and thus 10 relieve the oanss rom he nee M
Of demand upon them which il would have been hurttu
the State refuse and disastrous 10 their customers u
giant The negotiation which was made BY inc boarn placed
the Stale stocks al ABOVE par! and has ever since ur
nslcd full supply Of funds 10 meet all The demands oh
them.
In their negotiations OF The coupon bonds, the E"ard
hase been fortunate in procuring Inc services OF UahA
Jag house in Washington city rs their agent oo!he .!
the members o the firm Of Selden Wlhers 20 were
known tir Board and whilst they were capitalists OF
undob,ed means the long experience o! the principal part
ner Mr. Scrn in the finances of country, Ier
ol the United States together with his lofty characi or
honor und integrity seemed indicate that better se.ec-
ton could be made The energy, activity and efficiency
wiki which the agency have conducted te neso'iaons'
have fully repaid the confidence Of the Board
The Board determined make the interest upon the con
pom bonds payable in New York, considering from all the
they could obtain, that this was Indispensable
., living them iul currency in the markets beyond our own
BORDERS Our stocks have now for the FIRST time WITHIN our
history market value permanently above par beyond Inc
limits OF the Commonwealth This Is attributable IL the
fact bonds CONFIRMED 10 The views OF conHef
caI men, BY being readily transferable from one holder 10
another thus constituting commodity in all markets there
money is seeking c Investment II has turned pubic al
tcnion abroad 10 Virginia, her means ana her resource
nd is now beginning be understood beyond our lss,
what we have always known NJ home, that this Coian'
wealth deserves high credit as any State in the Union
The intucement To the adoption of the coupon form OIL
bond was the want of sufficient home demand 10 absorb
The large issues stocks required tor the prosecution
of our public works Coupon bonds meet the requirements
of foreign purchasers in manner IN which those OF the ou
farm rntry fall 10 do and adoption Of that form By The
State mas greatly extended the sal OF her stock IN marcus
beyond her limits Prudence md economy "ever f'fbu
The of TOO large debt by this or any n'heE
means The interest annually payable upon such dtDt Is
yearly cash balance against our commerce. and It's amount
sbud h. kent down BY every within power he
counon form Of bond ought be adhered TO- enagng me
.rket fox our stocks and the only adequate means OF
maintaining their prices at the highest standard ou III Tie
large as much possible the home demand for these s'cn
ties This is douby important because unless the nome e-
mand be supported and maintained the demand abroad can
no, long continue firm and healthy.
The Board decidedly OF opinion that the most certain
and ceca means Of accomplishing this object that Is To
say Of reyiYng and strengthening the demand ctmn te
Commonwealth for her bonds IS 10 require me citcuao
of h banks to b. based upon these stocks Inc furnishing
currency the community Is o"e OF the functions " p
lcl sovereignty, and is preroea!Ve ";ncn belongs 10
alone This prrrogatirc Is usually IN our c"u
try delegated bankS, government imposing such cpai-
lions upon exercise uf The privilege as the puoc re
and interests require in Virginia, one OIL Inc conditions o.
, privilege payment by the banks OF senl-annuai
bon!s of oncouh cent Of their capital stock mo TIE
public treasury in Massachusetts, where the capital en-
poycd in banking is nca four times as great as at o. "
n, the bonus charged 10 one per cent per anu anu po
iuces 10 the treasury OF nearly hall million"
dollars In many the States OF the Unon New York and
achusets for example the further condition imposed
upon banking institutions privilege of exercising the
reign function in question: is 10 require that notes en-
caon shall not be issued unless public STOCKS 10 an ~ IA
am lnt deposited with the treasurer OF the State as S
ritz their redemption tina! officer being also req fri
cnnutersgn such certificate of such depus:!-
Bark notes are thus invested not only with the cTed % me
blnkiny corporations by which they are issued PAT o. o
The States whose bonds pledged To secure them 'ng
%i he responsibility Of the bank ITSELF they bear III" i'm
JrimI,ur Oi the State.
Rr1unu thu circulation Of tbs banks of this State be
based upon her stocks would not only adj new element u
tie security Of that circulation currency but won! GRE
Ate dcnu nd Tor her bonds equivalent To the amount
Of her banking circuIaon-a demand ~iieh would b iGy
with any future cxgcnccs Of the treasury re-
suitiag from appropriation for public works.
To reader this m.a5urc thoroughly efficient, sound policy
won iii require that further special charters i"T
blnkns purposes be 2ranted-ht in lieu thereof general
be enacted prescribing the conditions and incidents OF
exercising the banking franchise and authorizing all ass1ci
tons Whatever that might be disposed to encounter those M
cdets upon complying with those conditions pso tdcio to
banking corporations. Among these incidents aud
conditions the more essential the following: - rex!
holders DC Individually liable for the obligations 81 IT,"
banks 10 the extent Of their shares The capital stock ~ an"
bank be than million or less than onr in
thousand collars. The number ut stockholders ~
bank be nns than fifty Banking circulation 10 DC
based dollar for dollar upon stocks and
signed by State officer Bank. redeem their circulation
par specie not only at respective counters bu' ais
such commercial central points in the Stlte as shoa 81
designated law respectively for the bank. Of each section
o the Stnc. These. with such regulations al"aiy
prescribed by law would provide and indispensable safe
guards against abuses OF the banking privilege by over IS
banking, other fraudulent practices IL Is only
the abuse Of the banking franchise that renders these nS-
tons public scourgcs When provides against
such abuse by all within the compass of lave, il does
whnt duty upon the subject Having done his should
abstain from doing much 1t should leave the business
OF banking the operation OF the general laws Of trade II
shoul leave il free for all 10 pursue, AMI not cnnne i to
few specially chartered corporations. II should allow
ti.ion the hcahi influence in this branch OF
business a. il cxer,s in all others II should refrain from
combining the business few avorite corporations thereby
creating monopoly OF money dealing and currency mlking
b.neu and disastrous 10 society than all other species
Of monopoly.
FnEz BAxKSo under the restraints Just adverted de-
viseG protect the public against the disasters OF careless
and irresponsible banking would allow the business 10 be
nusucd wherever the State money could be advantage
ousv employed legal interest, and would greatly diminish
the lenug of money asuripns rates Under this system
in localities requiring little banking capital banking would
he conducted upon limited scale, and 1T limited expense
In localities requiring large capital the business would be
conducted scale commensurate: with The larger neces.
srs Of the community. The business of banking would
accommodate Itself the eSisenci"s of the community
he. in the Sutcwnud increase with an Increased
demand for capital and decrease with diminished demand
Each bank would be independent OF the control OF all
Others while aFrs would be subjected TO the ever sig
liant scrutiny OF the community Immediately interested in
their prOprr administration. Requiring the number OF share
holders zach b. least fifty, would prevent tho
secret and reckless operations of private banking
Restricting the capital of each institution 10 million OF
dollars would prevent those large moneycd combinations so
often formed fOr the agsrandlsement Of capital the
pcnsc of labor Subject such limitation capital, unct
This system, would combine wherever in the State, and il
whatever amounts circumstances Of trade wouj require
without the expense delay and uncertainty Attendant ngnn
apple os the Legislature for special acts of
ton Banking capital sprngng into existence in a,': OF
smaller amounts in every locality in which demand c>-..
ed would increase rapidly in aggregate amount in the ate
would give impetus her agricultural mechanical ara
manufacturing in, ercss would continual deii#'i
her bonds and would pruyca productive source OF taxa
uuired he created simultaneously with appropriations
der tic constitution
Tho present is peculiarly propous time for the ador
ZION o The free banking system The charters Of the exist
ing banks cxprc and the Legislature will pro-