Burlington free press. [volume] (Burlington, Vt.) 1827-1865, 1856-02-08

had been in banstjlc funI'.
give have been requested to cory tho FOL
lowing article from the Boston Advertiser.
our banking system.
The Governor, in his late message to the
legislature, has wisely cautioned it against
increasing the banking capital cf the Com
monwealth. lie is to be commended fjr his
good Judgment and faihfulncas. There are
potent reasons for the advice. aud it cannot
be slightcd, without great peril to the inter
ests and honor Of the Commonwealth. We
90 little beyond the counsel given by His
Excellency, and assert, that no increase what
ever should be made. whether in addi ion to
the capital Of any bank already established.
or by the creation Of a new one and we will
give substantial reasons. we think, for our
opinion.
First, we maintain that our bank capita,
is too great already, as cyncel ~ the uudis-
puted fact, that it cannot be, and ia not en-
ployed within the bounds and for the logiti-
mate uses of our own community. Now.
here is an important principle di,rcgarled.
which, in the end, will prove Injurious to
ourselves as it is unjust towards others
Next, the basis upon which our system
rests, is alarmingly feeble and insecure, and
the hazards to which we are exposed are cx-
cecdingly great and dangerous.
" Our present capital is too great" This
We discover from the certain truth that
very large proportion of our loans, especially
in certain districts Of the State. and to
great degree in the cities. are made to per-
sons and corporations in tho Western States,
especially to railroads and our bank notes
form the principal circulation Of those States.
This is illegitimate business for us, and is
maniiestly dangerous and insecure-insccure,
because the enterprises which we depend up
on for security are of a very doubtful rcspon-
sibility, and their managers not the most
scrupulOus in their measures, as the history
of railroad proceedings, generally, declares.
Q aim to build them up-there Is danger OF
their dragging us down. We take their
bonds for security, frequently at a discount
of 80 per cent-a selt-condemned security
If the bonds would sell, loans would not he
required; and if this be a true view, while
full credit is not impeached, what may be cx
pected in time Of panic or pressure. when
they shall be relied upon to redeem our notes
But there is a more certain and permanent
cause Of danger threatening Tho time
must come and that soon, when the Western
States will provide currency Of their own
and ours be thrown out , when neither our
loans or our currency will be wanted then,
how shall We employ our excessive bank ctl l.
tai Why, we shall be driven to uses FOR it,
hazardous or dshonorablc, or it Will be very
property.
1t cannot be questioned for moment, that
if banks are created Tor any other purpose
than to facilitate, and accommodate, the local
business of the community IN which they are
established, they are created on false luun- /
dation, and sooner or later will prove a curse.
| is nt ir,f fiair trnn .hstra -. Ia. ia
profitable above the legal interestol the coun-
are not in their nature tradmy in
on the contrary, their Office Is to
supply salutary check upon excessive trad
ing, as well as to afford legitimate traffic,
needed assistance. The instant that banks /.
are created with the view, solely, to be made /
profitable investment OF capital, or are con- |.
Quoted with this view, that instant the public |
is dctrauded.
We discover further, that our banking cap
ltal is too great, from the fact, that since Its [
recent great enlargement, the rate OF interest /
for the use Of money has greatly incrolsei- /
md the commercial community, especially in .
The cities, embarrassed and impoverished, in .
The cause is too obvious to
lecd explanation it is the Western loans
mat have done it-as was foreshown would .
De the case in an article we published in tue
Daily Advertiser, two years since.
And now as to its immediate d1nG'rs.--
The basis on which our system rests, is cX-
,eedingly weak and insufficient. By the
atest returns, we find we have twenty-i'ur
Millions of bank notes in circulation, VITA
our and half millions Of specie, only, 10 re-
leem them three and a halt of which amount,
S in the banks, at Boston, to respond 10
even millions of circulation, and ipurtcen
Millions Of deposits, the latter, tar more FER
lous than notes, because IN times OF pressure,
# dstrust, they are liable 10 be drawn out
more suddenly, and in larger amounts there
emaining only one million. III the vaults oi
he country banks. to meet circulation, eA-
lusive of deposits, of sixteen millions
We are well aware, that an item is depend
d upon, and blazoned conspicuOusly, eutit-
ed = balances due from other banks s'-hut
hat. we ask, in case of general di'trust, or
ecessity, is this worth, W hat the value of
he streams, when the fountain is impure
Y hat one questionable reliance, better than
mother Is it not delusive, subtle, dan
erous reliance credit upon credit depend
nee and the main cause OF banks holding |
, little specie, rs they do
A further increase of our bank capital.
len, will increase all these evils-lrt general
istrust once seize on the public mind, by the
Iilure Of western speculatlons,-a prospect
war,-short haryests,-cXhdustlOn OF guid |
lines-or, interruption to receipts from them.
Y cause of war, and the whole business ut
he country, and the ad.irs of ordinary life,
i'll be thrown into confusion. Tu,rc is mo-
init to this desire for hank expansion On the
art of adventurous speculaturs-thtle Is uO ,
ympunctlon in their minds as to the general .
The public, generally, has no 0
rohtable interest in the speculate IN, on tie /
)ntrary, their best reliAuCes are nut IN ltJ-
ardy, by the reckless daring OF Il few,