Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1857-02-04
c0KKU11QAWON.

lsaisons Of ~ UsioA aAa A1sT1eaa;
10 your paper Of the 3Qth ult, / notice con-
muniealion over the signature OF W, upon the
subject of 8 proposed charge Of the Free Banking
Law Of Tennessee by the next Legislature. The
writer Of that article is in favor OF having the la"
changed or % amended that any person having the
means or credit to purchase a State Bond OF 1000
dollars, and wishing to commence the banking
business, shall, by depositing that bond with the
Comptrol Ter of the State have from him one thou
sand dollars of countsrslgned bank notes, and be
entitled to eli the banking privileges allowed to
snv other free bank 10 the State. This would
make banking in Tennessee empbatically free
thing. But Would such change in our free bank
ing system be at all likely to bring about what
your correspondent seems to be in favor Of viz:
sound Ourrency1 Would it not be more likely
to hsve q contrary efsct7 Would banks not
spring up in every county and probably every
neighborhood in the Slater And would not &
! great many persons engage in the banking BUSH
/ ness for the sake Of the interest on the bonds,
who had neither means nor experience in the busi'
nessI Night not some of these banks be mis-
managed, and would not the Encouragement of q
few Of them be likely to bring diSoredit upon the
whole free banking system in Tennessee? Now
if the writer of the article in question is right II
his opinion, that the bonds ample protection t.
the note holder, would 1t not be more to the in
terest Of the State in a peounisry point Of view
and fully as creditsble to the Legislature to Civ
the exclusive privilege of issuing notes based upol
bonds to the Bank Of TENNESSEE The Bank be
longs to the people, and by late decision of tn
Supreme Court she is entitled to some eDelpsiv
privileges in bsnkng. If this exclusive priveg
was extended to the Bank of Tennessee would
not make the benefits Of the free banking las
genersl-just what your correspondent claims thi
should BET The Legislature can go change c
amend the free banking law as to authorize tb
!: Bank of Tennessee to purchase the bonds of th
} State and those endorsed by the same at par
these bonds to be paid for by the Bank of Ter
nessee issuing bank notes to be counters COED
! the Comp roller and redssmable in the same bono
! wien the sum of one tho-sand dollars is presente
As the Bank purchased the bonds she could d
liver them to the Comptroller and receive fro
T. him an eq9al amount Of eountersgned bank note
These notes not being convertible into speci
= would soon become the currency of the who
: State. Other banks issuing notes redeemsOle {
= demand in specie, would have to furnish the e,
It change and coin wanted, and in this way The
Il issues would be returned upon them 50 rapid
: that they could not expand as some Of them hs7
done and we would probably never have arOth
n stock bank failure in the State again. Upon {
}. the bonds thus purchased BY the Bank and depol
e ted with the Comptroller, the State would So
q the interest which would certainly make the be
of e6ts Of the banking law equsl; and assuming tn
the bonds deposited with the Comptroller a
ample protection to the note holder, we won
have sound and uniform currency.