Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1855-11-20
According TO the Albany Argus. the lower branch
# the Legislature of New York will stand ~ follows
TILE SrATE BANKING SYSTEM

week ar Two siu,e To- discuss the advantages u! h
old charter system OF banking. IN Virginia over th
proposed rinral "t II general balkllE! law base'
. uuu Eiryinin SUITE Securities. His arguments wcr,
Equally wanting IN canl"r AMI in logic lie lcltlIc
Represents the General banking SyStein' IT, II r'"l,,
c>ists in New lnrk-the first State !" ih'!nlucc IL
us II has been the fJrt 81 Ia bring II nj" liz safest
and most pcrluri turn--unr, hGs Ire shown wherein
the old State Bank ,"w applying l"rrc cii"rlcr,n"nld
b. less secure by the introduction OF 9'lt H'"'k'
rs the bass Of crciia'ioi G"dH'""W !" inc Si,t'''
they are required IL keep an hand L" SAY lhAt These
hanks have been fairly managed f'if iat century
pas, and then infer iE.t they woald nat be 81 mi''
u--d for hall century Ia come because require" %
nut no additional security Tor their circulating Iiors'
= wLnlIv insical Il would have been equally pan>i-
b, md infinitely more candid To argue thai Is he
wJnyuLy OF the business OF baiIkiE "n'cn ''l': w.
ma,li at the hand, OF the Legislature I" ro.ieI '
useful to the public and e'pcri""a. ia y, io,.,
themselves The point thu, male w""'' al 'e"S',
h,vo mad cred Tor hndncss. There are many S"nd
purplc ton. who might have Drc! taken WIN .i'e
J.a of a "sreat regulator at Richmond, Ike 'h,
I'll az Virrinia or tn, Farmers Bank, aud disposed
10 xiv. in to the modest propositions "t placing all
control and unlimited c"ntdeucu--wiia"ut security
,,I,.l with the State lI :hr hands I'll this money
power: in order I" give II prominence ""d P'!"I' IL
| well IL Il commanding political inIut!rr
But, since this c"Ursc III reasoning Is moi ruIsu'u
nv yuur CORRESPONDENT, and seeing that Iu has placed
the two systems the i>>ie ol credit and security
Is now respectfully submitted. through! Your columns
hut the hnlt has not been told vi the old or the new
| i.
earnestly engaged in usyscin of public works, which
cn.ulctnl are IL brn, more wealth 70 her people, III
vv,han the banks have taken from them III nifty years
large, as the drain has b,cn,-shuud separate herself
| from the banks. and sell out her bank stocks. The
position "t holding Farmers or Virginia iauk shares
because they urr ~ premium ut !nnnr, While her
| own Bonds are selling al Il discount abroad, II wholly
inconsistent. Ii is neither dIguircd nor crcd:hhc--
The difference between holding tive millions III the
stock al the bank, an! denaNdi; "i these banks I"
| lodge live millions I'll the stock 81 the Common
wealth, fEICtg ten "!i'O" ~ dO''S IL re cfsIf
81 me i1i'.,. The proceeds ot the bank shares IN
vested in the Brnls OF the Stale added I" five mil
| lious uf the bonds pledged with tue state, ""H"
| a6,c,6 !ha1 ">t-iIALF NE ""taand'"% Pr'i'r
| d.J:. IL would Recall from New York ana Lon
don an amount OF Virginia stock which could not
| ia To place the credit ii tIr Commonwealth
eide BY side with that "t New rkw"gtlI,n the hard
-si 81 times, IL to llo per cent. and generally ru
0- NJ rs 10 l2o. THIS il, surely, worth thinking OIL
The credit u the $tnrt, indeed, II. or shout! be-
PRIMARY consideration with every true NirgiIinu. The
| additional responsibility rSartrd 81 The present
Banks, organizing under general law, Is next 10
/! he thought ol. II will harm no public n;cte.t' IL
will conserve the interest ut tc nuteholder IL Will
take f.um the Banks the present odnus feature al
monopoly aud deprive them Of tile arbitrary Will ri
Initiating the currency without sufficient SccufN' II
* not enough IL assert that thus authority has moi
Ell abused. iic pubic do mol vr "uIr ri HE idct
The system III brac:.ih IN the idslu-sar- al the
iuullntuil. long since opened the way Ia abuses IL
l. known thu: the credit ii Virginia money out o te
state has greatly Suffered from ;i's most convenient
L0L.s re escape the responsibility NJ paying specie
on demand. The could not possibly he made
worse hy lodging Virginia stock. with thu Treasurer
| NJ Richmond The noic-hulier would be ultimately,
ii not immediately secured. Inc ,p-cie 1nSI' W"no
not or ought not to be lessencd. The probability Is
il would be voluntarily Increased from sense vi Tic
danger OF the prompt aud forced sale OF the stocks
IN cuse OF default. Finally, on this point, there
need be no apprehension that any one OF more
of the present Banks will decline re-organiza-
ton under n general inv. Ii they use
iuI now, they will not be less 40 then. The possibility
OF >c;dcuai in refusing the only charter the STATE
will consent /" grant, IL very reEutc one iEuecl.-
M instance. uf the kind has been known i'll the lily
of New York where hall Il dozen Banks OF half II
century s;nuding staid Did Concerns with whom the
Farmers and Virginia Banks have probably cores
uonded time out OF niud-havc recently and v0lnn
turiy under tile Gclcral Law, auu oceN Out toO
happy in the opportunity
> Your correspondent has wholly Inexperienced
the history OF the General BunkIng Law. lhou:'i
admitted TO be u New York system, he goes 10 the
tnr West Ia instance the OF Indiana where the
worst guarded features al the first draught "i the
Law al New York were fallen upon, through the Gun
ming mama cement III the Legislature of nnn-r"rId'n
Bankers lie also ,n"s back 10 the earliest cAl'crl
men, Of New York, to Instance the otIectlun. oil MI
GnlIatiu sine. whose retirement from Wall Stree!
and Subsequent cccast. the system has been steHd!
and consistently improved and strengthened by ID,
Legislature, uui everything IN the shape at Siait
b,ud. rAcrut the stocks OF New York AMI the Fed
ernl Government, has been excluded n basis at en-
culuon. Even bonds aud mortgages to ole hai
the amount Of circulation, and upon propert!
Of the rush value ot doubl: the niurtgag,
nrc admitted with IrlucthlcG, ma uH'.'i
such rules prescribed BY the Bank Department. MS tC
render the operation undesirable I" Banks III the
wenithieSt rural districts. The studied policy ha'
been 10 Con."rv" lii" Stat" credit tn make ilr bank
,rs and the people IA" circulate their purr, rcspuhn!
bl, la their primary capacity ELECTORS, for tn,
prudent mana. I'll their '.,Islnrs III t Gr.i,
If The pGbr debt. The n:ncnd'H! law recognize!
New York stocks al'n" for tli. wi"!" circulation
here only single class at security - t"hiti"I. ln
bunker ndy pledge one-iIiN III Fc'Irra! ri"rEs -
hnnls and mortgages but ,h" other halt III such c''c
: ,,yI be- New York stocks. Thrrr.tnnrth> the t"tn
ut securities present i'll the Department are coss
uu,uily IN New York stocks. The premium whisi
they have commanded in LIQUIDATION of dciauilin
= bun- has been kunwg Ia cover an Gccitniai dti!r
IN the liaTi Gss'ls from the forced saIt q
mortgages. Such aiming Is deficit, when tho srclr
MAS wholly in the stocks 81 New ork ana the lilf'
States il never known. The ia lIrrs 10 which yn'l
CORES pnneul refers parity the authority at Nj
l. ,;nl!nn, took pia"c IN the early days al ne system
when u.!"r State stocks were admitted. 'i ia
tw"uiv-,isht thirty millions -! New York h''iit
IN actual circulation in ISL, through two hul,!r"
and nifty banks aud bankers, scarcely sIIgit d"l
was lost the people la six eases OF dciauf on
,cv.l among the small hanks in md around the ri'.
! ,luri,. the very hard times last winter, the wl"l
q | au,,un, oi circulation immediately paid at IN
Department. In the other cnse, the loss WAS n tent
on the remnant of circulation intended I" he -
y cured bv mortgages which proved ot doubtful valid
Is Is ar value.
-. Z. Your CORRESPONDENT too. has mistaken whn
ly misnrpliri what h. had. no doubt, cnsuall
heard of Governor seymour course on the :;"ncr
II banking Law The facts Ut the case ARE highly a.,
,ii,nbc Ia the s"uudc>> ut the law, and at the sam
Time Ia the good AMI conservative ll!gin"i
of the Governor. lie bnruc out bv the pres AN
> the people. IL" supported 10y the epnI"n a, III
IL head OF the Blnkng Department, though poil''c
!; oumncn Certain Interested parties ossaycd In MIR
tl.h nf Y,rS o. he
n partment for banking basis. They succeeded, by
n combination of local Influences III acquiring u
,s amendment the general law, through the Legsl
ture Governor Seymour promptly rrfcrd the bill
" II was an attempted step backwurd-the first in tn
NJ direction since Willard Fillmore introduced the syste
in lSS- which III" Governor woh, not listen u
B., which the press warmly demonstrated against whi'
,h, Bank Superintendent represented l" bc d"iiSt
IL u,s, aud which the people would hot have tolerate
70 , single. vcnr il an "ii-shuut nt The general II
,c ta,inn 1888, aud was "|er heard OF alter me 81
1. The circumstance under which Mr. na','
Is wrote ararst the New York law OF lS's, have 6lrr
DIV been expIaincd. Ii may be added that Mr. .ia
nd tin at that time, like some estllnaDe and tacnie
~ gentlemen OF the present duy, was interested AGAIN
- the whole system. He was al the head OF the Mario
Ii" nj Bank in New York. OF which concern his SOD, ia
~ Gullatin is now the President. Ii is quite probaO
he that Mr.. George Newbuld of the Bank nt Amer:
H. Mr.. Palmer OF the Merchants Bank, and the man
gers oil the old Bank "t New York, Cni"n Ban
"e ft'snlN Bank and Mechanics Bank, deemed the ne
rrlncip" AN innovation upon the ancient and chari
90 ed c'rcie al riosa corporations. Yet these have
, come IN, except III" Merchants whose old charter t
io plres III January, and became banking association
under the general law. There s not one OF the
whose credit Inns been lessrned. not one whose re
Importance Or public usefulness has been di,nn.he
" not one whose STOCK hus iuicn because the adr
the tional security lodged sh the Bank Department
v. ALBANY These facts have been gathered from
l., source in New York entitled 10 confidence III
=! are important to correct the ui history uni
II u territorial, no doubt. into which yuur currrsp9nlr
vC LGS fallen.