The Athens post. [volume] (Athens, Tenn.) 1848-1917, 1855-08-24
MORE SHAKING.

MORE SHAKING.
Report says the bills Of the Farmers Bank,
Knoxville, one of the institutions organized
under the Free Banking Law, are becoming
rather uncurrent up The county, and we
learn thcy are no longer taken at the agcn.
cies Of the railroad. II Is matter for surprise,
If not regret, that any of the banks should
manifest ,cedkness at time like the present,
when the crops are fourfold more abundant
than they have been for years, when Nil do
scriptions Of produce command highly remu.
nerating prices, and every business interest
seems to be on the full tide Of success. I'm.
der such suspicious circumstances there
ought to be no panics, alarms, or "bust ups"
The FREQ Banking System, when first
adopted, met with great favor, but We are
apprchensive it wont do--in every State
where tried, it has failed to realize the ex-
pectations Of the advocates of the system
We do not mean that there is any great dam
ger to bll.holders, or that the Free Banks
will not ultimately redeem their issues-on
the contrary, the State Stocks deposited with
the Comptroller rs security, guarantee against
any serious loss on the circulation. But the
Free Banks are failures for the legitimate
purposes Of banking, so far as subscribing any
public good. They are required by law to
keep in their vaults 10 per cent in specie OF
their entire circulation, and in the event of a
loss of confidence on the part Of the public,
panic and run, they must necessarily 90
into liquidation, because confidence in a mo.
ncyed institution once being destroyed, can
never be fully restored. The specie fund
being exhausted, the Bonds deposited for Sc
curly must go into market, and il they car
not be sold at par, they must either be held
up or disposed Of at sacriiice--and in the
event Of the latter, pro rata redemption o.
the circulation takes placc-that is, there i.
an actual loss TO the bill-holders to the ex
tent Of the loss on the securities.
But going on the supposition, which /.
generally true, that the State and othc,
Stocks on deposit rs securities can be dispos
ed of ut par, and the proceeds prove sui
fieicnt to eventually redeem all the circua
ton, the delay that will necessarily occur in
winding up one of these institutions must
frequently result in much injury. For exam.
pie: Free Bank is forced to go into iqui.
dation, condition to which they arc liable
to be driven at any moment if they aspire to
become anything more than mere brokers'
shop, and an individual happens to have in
his hands any considerable amount of the
bills-he may have the greatest confidence
that they will ultimately be redeemed, dol.
lar for dollar, yet at the same time the delay
my prove ruinous to him. He must either
wait, perhaps to the destruction of his bust.
ness, or submit to n ruinous shave at the
hands of the Shylocks and money. changers.
We respectfully submit that this is not the
thing in the way of banking demanded BY
the public interests, md that the Free Bank.
ing System is failure in regard 10 furnish.
ing reliable, ready and convertible currency
although some of tho objections to it may be
urged against other systems. We are, oil
conrsc, speaking of the system generally, and
not of any particular institution organized
under it, for we regard the notes of the Far
mers' Bank really just as good MS the issues
of any Of the Free Banks, and that the bill
holders are just as strongly secured against
ultimate loss. We may recur to the subject
again.