The weekly pioneer and Democrat. [volume] (Saint Paul, Minn. Territory) 1855-1865, 1857-12-24

which ought to be adapted with the
utmost possible wisdom and skill TO
the wants of internal trade and for
eign exchanges. If this be either
greatly above or greatly below the
proper standard the marketable
value of every mans property is in.
creased or diminished in the same
proportion, and injustice TO individ'
uals as well as incalculablc evils to
the community are the consequences,
Unfortunately, under the construc-
ton of the federal constitution, which
has now prevailed too long to be
changed, this important and delicate
duty has been discovered from the
coming power and virtually trans.
ferred to more than fourteen hundred
state banks, acting independently OF
each other and regulating their pa.
per issues almost exclusively by a
regard to the present interest of their
stockholders. Exercising the sover-
cign power of providing paper cur
rency, instead of coin, for the coun'
try the first duty which these banks
owe the public is to keep in their
vaults a sufficient amount of gold
and silver to insure the convertible
ty of their notes into coin at all
times and under all circumstances.
No bank ought ever TO be chartered
without such restriction on its bust.
ness as to secure this result All
other restrictions are comparatively
vain. This is the only true touch
stone, the only efficient regulator OF
paper currency the only one which
can guard the public against over
issues and bank suspensions. As a
collateral and eventual security il is
doubtless wise, and in all cases ought
to be required that banks shall hold
an amount Of United States or State
securities equal to their notes in
circulation, and pledged for their re
demption. This, however, furnishes
no adequate security against over
issues
On the contrary, it may be per
verted to initiate the currency. In
deed, it is possible, by this means to
convert all the debts of the United
States and State Governments into
bank notes, without reference to the
specie required 10 redeem them.
However valuable these securities
may be in themselves, they cannot
be converted into gold and silver at
the moment Of pressure, as our cx-
perieuce teaches, in sufficient time
TO prevent bank suspensions and the
depreciation Of bank notes. In En-
gland. which il to a considerable ex-
tent, a paper money country, though
vastly behind our own III this re-
spcct, il was deemed advisable, an
terror to the act Of Parliament Of
lsi4. which wisely separated the
issue Of notes from the banking de-
par,tnent, for the Bank Of England
always TO keep on hand gold and
silver equal to the one-third OF It's
cornbined circulation and deposits.
If this proportion was no more than
sufficient to secure the cOnvertIbllity
Of its notes, with the whole Of Great
Britain. and to some extent the con
tinent of Europe, as a field for It's
circulation. rendering it almost i'm
possible that sudden and immedI-
alto run to a dangerous amount should
be made upon IT, the same proper
ton would certainly be insufficient
under our banking system. Each Of
our fourteen hundred banks has but
a limited circumference for ~ cIrcu-
la,ion. and in the course of a very
few days the depositor. and note
holders might demand from such a
bank a sufficient amount III specie I"
compel il TO suspend, even though II
had coin in the vault, equal 10 one
third of lts immediate liabilities.
And yet ! am not aware. with tie
exception W the banks 81 LOUISIANA,
that any state bank throughout the
Union has been required, by II.
charter, 10 keep this or any other
proportion Of gold and silver com
pared with the amount of is c"m-
bipcd circulation and deposits What
has been the consequence
In recent rcpor, made by the
Treasury Department. on the cond'-
ton Of the tanks throughout the
differen, States, according 10 the re-
turns dated nearest 10 January. So.
the aggregate amount Of actual sp".
Gle in their vaults ia 81 ,3i3,s3s, of
their circulation s2li,',s,s22, aud of
their deposits $3.50 81 352 Thus