The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1857-08-30


Monday
hesrs Williams, Tanner 4 % forwsrders, suspended
payment yesterdav afternoon.
MISCHIEF OF THE NEW YORK SYSTEM OF
ALLOWING INTEREST ON DEPOSITS
Iron he sceton Advertiser, August rs
There the best In the world why the expo
0n OF moneysd houses In New York should meet
WITH erDg echo Ia this city. Il u gratifying
the soiid confidence with which bank stock Ia
sod IN Halo street few shares In the Bcyl,tcn Bank
sse hey probably would no, have coae upon ihs mar
kca) ana commanded premium of ST. per share Thcrc
.se no sgns Of panic here, and there no reason why
We have grea. canse for congrAtraiion At ruob
mems This, that banks prohibited by sv from
paying interest 6eposits. different prevails
IN New York. and tbs fruitful source Of Just such
naAschievous results ~ have recently eeen de
veloped me banks In the city Of New York
ere anxious secure deposits Of money,
4 hoy pay say per cent inter'st on an'onD.
saf shs prci,.bIe business. because they expect /,
han the money again al higher rate OF interest The
ser appears tempting TO ,nai Tidass who happen havo
money on hand awaiting investment lore particularly
country Ssnke alinred by this promise OF Interest 70
deposit with banks In the city Of New York AL the funds
which they do net require for imme dale They
oven sohced 70 do 70 by circulars By the city
banks Such country banks, PARTICULAR times. OF ,ourse,
have on hand considerable fnnd after hey have dis
counted many notes they dare, and seems N 60
harmless oct 10 put this money m New York where u
WI interest rather than 10 10, lie dIs'' In their
vsnhs Il ON BIO recalled from New York, II is sup
posed, any moment when is needed fer the redemp
ion q bulls me oty banks, In mus appearing - Dor
"a isr ns nyscs,ce 4. hsa cnourh. Sus n o,ss IN tho
next sage Of ts ecrscqucnccs The Now York city bAnss
by their suooe nful solicitations for those deposta find
Aose,vcs pcssessed Of Considerable amount Of funds
which they paying four and Eve per cert interest
hey, their part Ike the country banks, dare NOT
period run, for they knew that /, may be recalled 81
any moment by the depostora So they are very glad
10 nsn The funds TO brokers demand taxing sor d,
security that m,y Offer They begin second series OF
sosiniaons TO ind borrowers ouade the ranks Of their
regular customers.
me third stage of the business accordingly Witnesses
brokers without any substantial means, invited and
tempted by the banks 10 borrow their Fun 10. dc
and a seven per cent iptares The brokers give soms
NH Of railroad shares ~ security, aud enter into
apecoAlons with Nc money thcy have thrs Oh
red when their spcculsiicss fall the security which
ney have offered must be pressed upon he msrkes-t
proves unavailable 70 The debt, whereupon
NE bAnh goes down, and the unsuspectng deposition ose
imuianecus failure Of thrSe distinct classes operators
NE events In New York have pre- aseiy uztrae ed
me whole difficulty ar,es from too great easerne,s %
make money productive Their balance OF spare funds IL
by the country bank TO the city bank aud By
city bank 10 the brokers, In the hope Of gelrz Lille
xrger Of interest each turn, whom ought 10 DO
resaped by the county banks IN the fret place, unless
siness Of lheir own locality. when thsir Iosu mas
reached the iegsi limit, they can Afford 70 forego
soe prrc@rica. profit OF interest on ihe tempo.
deposits on interest, made by individuals q man VINO
NAL such deposit simply relieves himself 0; the trou
"
upon he bark nhe known Of Certainty lhai the bank
10 managed more prudenly than he manage his
swn bnslnoss, he wise TO trust 81, and not other.
wise
ha obvious thai the acting In this mlscoevods
res Of operations lea with the city banks who ocr lnte
rost doposU They tempt deposiors On the hsud,
and borrowers the other, into operation which Is
Inherently dangerous There would DE little opportunity
scs brokers whose Of cash scsniy but wa1
sre rich 10 fancy stsk- % enter INTO -pscusiious he
city Csnks old rot invite them 10 BORT .moueS DO
nsno. gvius their stocks as tecE'iy And there would
Ia NNNra. II rUUEN
vdusl, seud Their fnds 10 Nes York "fcr s,ic keep
ps," Chs 10 reals singular phrase 70 describe tue
shnf) they we're lot temI led by the allure neat OF
prurnire OF interest on their tepos-a pronlse necessa
rily fosnied unsubstsntGl basis Accordingly the
evil IN beth 10 phssos would be prevented " tbe New
York banks should discontinue Inc practice o, borrowing
n,oney and paying interest.
oar more sautou, legislators IN Massachusetts, have en-
tert cd ihs principle ami have prohibited The hanks OF
Aa Commonwealth from issuing L0tcs pay ahls q,
future DAY, wh Interest, with few jus 4hablc
Sons The lss 4 true permits interest 70 be allowed
Bpou deposits made In oue bank hy another: BIZ, tho
Proc co 81 our BOson bAnw tGoh ~ 70 prevent any
mischief from this oafe The suflik Bank for ins.ance,
refuses 70 pay inerest to The country backs whose bills
= redocn 1n and although hts harsh regulation, u
undoubtedly toluiary one Dat Oh 100000 OF do
detailed return (Gctobcr, 1857 onT hale more than
hsf n Hon tvz., fSs6t7e bore inse:est Twenig So
OF o. the ih!ry.six banks IN BosOB had 20 deposits
~hsever On which they paid utsrcs Ths spirit OF the
sv tics exesdted wlh grei,ez ndelly than the letter
require,
The bsrks Of Sew York city ~ folcwirr another
rrxcoe, have entered where tnei arc lkey 10 DO
wrecked sud 70 dras down their both sides
70 scon ~ Tie great body OF New YORK business men
shall zee this OWL and thal prevail with their Legs
Afure end wih the ~ the banks TO prohibit {,
81 me simple expedens employed 10 kasssohusets, we
maj look for . better stae Of thlngs keau~h,ls
cd not DO surprised N hear OF The failure Of banks IN
No city Of New York togsner with the misfortune. OF
brokers vho borros and country banks who lend while
stock IN Boeon oanks commands per cent pro
mum. Therc . good reason for the difference
FAILURE IN STOCK OPERATIONS ONLY,
IRON the Providence Journal, Ausuu "s1
The reports rom New York speak Of toe suspend
I'd houses a. having 70 led only their stock Operations
and q gcnI With her ether business The falu-c In
aheir stock operu cns 40 SUPPOSE thai they nave
hed 10 pay their bets the and fall OF stocks and
IN or the rapid decline OF he securities most
operated upon certain sums OF money, which, "a mo
s,eb Of any moderate Quotation word hsve taken
cot OF INC pockets OF Get OF aud nut INFO the
vschev OF smother SET viii no. be Transferred tec,use tho
MN vho have lost tho not soc 70 pay them fail
nre o. this Kind OF inst much ,mp lrspo, fn rere
- large, az Inc f,iare Of Pat learn would be, AMI
no more There is ro,hng less immoral, there Ia
Leos rha Q nothing lsrs encntphie n