Weekly Indiana State sentinel. [volume] (Indianapolis [Ind.]) 1853-1861, 1855-02-17
More about Free Ranka


can be made safe and sound circulating me-
dunn, it is contended that the New York sys-
TEN, based on stocks, bonds and mortgages
has worked well. There is wide difference
between the New York Free Bank act and the
Indiana law now in force or even Mr.. Hud-
sons BILL The New York law requires all
the country banks to redeem their issues in
New York or Albany. They are re
quir0d to keep on hand, a sufficient amount
of specie in the great metropolis, to redee2
all their notes, so that the securities are an
have. None but strong and solid men engage
in Banking in New York. The wild and des-
perate adventures Of Wall street seized with
avidity on the liberal statute of Indiana,
which only required them to redeem their
notes at their counters, which was often the
counter of grocery in some obscure village
We assert without the fear of contradiction,
that the history of Banking nowhere, shows
an instance where Banks have ever sustained
themselves without a specie basis. Great
stress is placed on the fact that Mr. Hudson's
bill requires one hundred and fifteen dollar
srorth of stock for every one hundred dollars
issued. The advocates of the measure,
placed great emphasis on the word toorth.
Now such has been the practical operation of
the act ever since its passage, that stocks have
never been received for less than their worth
at the time of their deposit When Indi-
ana SIS were received by the Auditor, they
were worth in the New York market from
100 to los. vet they deprecated at one time
as low as &c. Whenever there is a demand
these stocks would run up again. Wall street
brokers and money changers have the power
to regulate the price of these stocks. That
they will do it for the benefit of the bankers
no one doubts. Again, times are precarious
and uncertain. Suppose some OF the States
whose stocks are secured on deposit, as secu-
rity, should fail to pay their annual Interest
dues, the bonds would suddenly depreciate,
and there would BE- no remedy for the bill
holder, but the ability and the honor of the
banker. Securities may be multiplied, the
fourth of the State may be pledged, it will
not all answ er-bank bills not redeemable in
specie on demand can have but bsief exist
although backed by the credit of the nation,
under suspension, fell thirty-three per cent
below their nominal value. Nothing pre-
vented their becoming utterly worthless, but
the immediate resumption of specie pay
ments.
Banks are of great antiquity. They ex-
listed as early as the year 1900 but they were
at that time universally banks of deposit and
not of issue.
Paper currency was first introduced in Chi
ma about the beginning of the thirteenth cen
fury, but it soon produced such arrangement
that it was abandoned.
Catharine III, of Russia, commenced the use
of paper currencyin 1853. Large issues
made. These bills continued at par for
four years. They gradually deprecated until
they fell fifty per cent. The distress became
70 great that all the wealth of the nation was
pledged for their redemption. 1t was how
ever, oil no avail, for one ruble in silver was
worth four in paper. The same disastrous re-
suits followed the experiment of Banking in
Sweden, Denmark, Austria, Rm,, Sardinia,
Italy and Spain. The world is familiar with
/ l. T IL l..
1t was perhaps the most stupendous fraud
and failure on record. France prOfted by
this lesson and the safest banking institution
now in the world is the Bank Of France. No
bills are issued of less denomination than
500 francs (S94) aud the bank has always
more specie in its vaults than it has in circu-
lation. Prussia banks on the anne principle.
The bank of Berlin has always maintained
its credit. The bank of England has been in
operation for more than $50 years. Its infu-
ence is immense. 1t is the power behind the
throne geater than the throne. 1t controls
the currency, makes war aud dictates terms of
peace 1t has built aristocracy and ground
the people to dust.
But we are wandering from our legitimate
subject. We only introduced these brief
references to show that the history of banking
has been history of fraud and failures. We
have no hope of any effective legislation which
can restore confidence to the rotten system
of free banking in Indiana, and without
confidence it is broken reed. There must
be a great deal of the wild cat in the thing if
Bankers will take hold of it, They must
have a certain security Of making money, and
all that they make comes off OF the people
The whole thing is unsafe, unsound and un-
popular. The peoples Representatives I'M
derstand this They will do their duty, we
presume.
IMPORTANT LAW SUIT-Hon. S. P Chase
delivered an argument in the Supreme Court
at Washington, Friday, Feb. IN |, in support
of a claim of Governor Seymour, of New
York, and others, involving the title to 12O,-
coo acres Of land in Iowa. Tue ownership of
Gov. Seymour and his colleagues has been up
held in all the Courts of New York. 1t has
been in litigation twenty years.