Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1858-01-23
CosfIusicAE1D.
TaE BANK OF TENNEssEE AND ITS NAN
AGFsfFNF


good faith % all men Every Wel-inforEled man in
the community knows that the suspension Of cash
payments BY the State Bank was a matter Of indis-
peusible necessity, resulting from surrounding cir
cumstsnees, aud not matter Of choice, with view
to make profit thereby to the State, By the injury
to the holders Of its million and half Of notes.
/ suspension by the State Bank, singly end aleHe,
would, in most conceivable cases. have brought dis
grace on its managers; but the State Bank is only
Of 400 in the United ststes the largest portion
Of which, and al at the great Commercial centres,
New York, Philadelphia, New Orleans, &C., have
suspended.
his not necessary here to attempt an elucidation
Of the causes which have led to this result. sue
cessiOn eff good crops and the high prices Of our
4 staples, Australian and California gold, and g
general spirit Of speculation and sxtravaganee, en-
gendered BY variety Of causes, and aggravated By
multiplication Of banks, and BY injudieiOus and in
discriminate loans, and the arbitrary displacement
Of masses Of specie BY the Eastern wars, must Be
regarded as amongst the most prominent csuses which
have produced the present difficulties throughout
the whole commercial world Under the operation
Of the general spirit Of the tines the Legislature Of
Tennessee IAN interior agricultural State, the trade
Of which consists almost entirely Of the purchase
of dry goods, groceries, &C., and the sale Of raw
produoe) has put in operation upwards Of forty
banks competing With each ether for business and
pushing their notes into eirculation-the pittance
Of specie required By the statutes net being sui.
Gent, even If on hand, to meet an unfsvOrsble
STATE Of exchanges, much lees q panic. The banks
81 the great commercial centres, New York, Charles
700, Saw ,nnah, New Orleans, and Philadelphia, in
his -raIe of things. had suspended. What was the
state Bank to do under such circumstances Il
PAS bound to pay near SfOO 900 in gold in the city
If New York on the FIRST day Of January last either
lrectly or contiDgenty. A previous legislature
u authorised sale Of the State stock in the Union
g d Planters Bank, witbs view to increase the
capital Of the State Bank and 10 pay debt Of
SI25 900, due on matured bonds That stock vas
not sold and the bank had to meet the debt out Of
ts profits. Il WAS paid. It had to pay interest on
S.aie bOuds ,Sl5O,OOl) It did pay It. 1t was re-
sDOusib,e On endorsed bonds Of railroad companies
{, ha TO be in readiness to meet that interest to
save the State from dishonor in the contingency Of
failure Of any railroad 70 meet the demand One
company did fail and the bank paid $4,000, and did
ztys that road aud The Stats from dishonor The
aark furnished gold in the city of New York for the
Tbole of The railroad payments in lieu Of State
paper.
AL these liabilities, direct or contingent, it
a,1uG 20 be prepared to meet in discharge Of duties
imposed on It by previous legislatures. To meet
coo Sc an other liabilities the bank had s., 100000
.a bills falling due at the commercial centres in sus
pended banks. Thedoor by which it was expected to
Jt-lu gold was closed, and the only resource left
was to co lect in gold portion of the notes dis
counted for the citizens Of Tennessee, to wit: ST.
600, 900, to meet the metallic demand in New York
and elsewhere. Just SO certain as the bank had
nliucei 10 pay specie in the midst Of the circuu-
STAGES by which it was surrounded just SO certain
would every dollar Of its cash have been drawn from
il by brokers, as an article Of traffic, shipped and
sold where banks had suspended and where l. would
have commanded a sufficient premium to make its
shipment profitable speculation; and just 50 GER
tain would the bank have been left without the
means of doing business the people in some meas
ure without circulating medium, the State dishOn-
Ored, aud the president of the bank declared unit
for the position he occupies Although suspended, it
has paid out in gold 100000 to those who needed
it, yet did not obtain it as an article Of traffic. 1t
has furnished a large amount Of exchange at one
per cent, when it could at the market rates have
ezacted larger amounts. It has discharged all the
obligations imposed on it by the State 1t has been
cnlbIed to sustain its circulation SOFAS like the Bank
Of England to tighten the blow on the debtor in
terest to some extent, inflicted by sudden reduc-
ton Of tie currency from, say S8,OOO,OOO to S4,-
OOo00O ana its notes will pay all domestic debts
par, and purchase all property, real personal,
at cash prices.
It may be asked, did not the Bank of Tennessee
contribute, by its management, to the suspension
which now exists? To this, it is replied, that
there is nothing to be found in the conduct Of the
bank to sustain in the slghtestdegree such charge
Il is evident from the past history Of the bank for
the four years under which it has been under the d.
rection Of its present vigilant directory, and its
present condition, that there has been consistent
effort avoid such increase Of its circulation and
such injudiooUs loans, not based the produce of
the country, as would lead to imprudent and heed
less speculationand indebtedness It is well known
10 the author Of this communication, as well as to
many other persons that the sagacious President Of
This bank has been predicting the present state Of
things and that be has held the bank in condition
to meet the crisis which has come as well it could
readily be done consistently with the duty imposed
on it Of supplying the community with circulation
aud answering in other respects thepurpOses of its
creation The amount Of its circulation for the last
Gonr Years since Colonel johnson has been at its
head. is as follows: