Staunton spectator. [volume] (Staunton, Va.) 1849-1896, 1858-11-02
sTAUNTON, VIRGINIA, TUESDAY, NOVEMBER 2, 1853
For the Staunton Spectator.
0Audi AIteram partem.', -

For the Staunton Spectator.
"Audi AIteram Partem.". ~
Messs. Editors AS several articles have ar
peared in your columns, advocating the revers
policy contained in the following, will you b
so obliging as to give it place in your next is
sue? 1t is taken from the Richmond Enquire
of the 18th October. A SUBSCRIBER.
The RIoHMoND BANKS AND THE Independent
BANKS OF VReINIA.-We hear good deal o
complaint in our city, as well as in our exchang
es, because the Banks in Richmond refused to re
ceive in payment or on deposit the issues Of th'
interior Banks. There is no legal obligation t.
require them to do 80, and it would be a stretct
of courtesy and liberalty that no one could ex
pect, for the Richmond Banks to redeem the is
sues of the interior Banks, which they would be
virtually doing in receiving them on deposit Oh
in payment. All business transactions are made
upon specie basis, and the 'bills payable
growing out of such transactions are due only
in specie, and no tender of payment in anything
else is legal. The Banks, in accepting bank
bills or promises, either previously discounted
by them or lodged with them for collection
merely exchange one class of promises for anoth
er, and to get the money for the latter, the risk
and expense of the mail or private messenger
must be incurred and ii received on deposit, the
risk and expenses are the ssme-s risk and ex
pense which it is unreasonable to ask any one
with or without corporate privileges, to incul
gratuitousy. Of the same class of unreasona
bic demands is the collection of negotiable pa
per payable at interior points, through ouI
Banks without compensation. If four merchants
will but reflect moment, they will see the in.
justice of the demand.
We notice in our exchanges that one or more
of the Independent interior Banks refused to
discount for merchants, except under promise
that the proceeds should not be used in Rich
mond. We know the two systems of banking
extant in our State are antagonistic, and their
antagonism is likely to exhibit itself occasional.
ly in just such petty acts Of spite.
At the last session of the Legislature an aot
was passed to secure more uniform currency,
one of the provisions of which require the
branches ofthe Virginia, Farmers and Exchange
Banks, to redeem their issues at Richmond, al. a
discount not over quater of one per cent. By
the same act the Independent Banks are required
to establish agencies, either in Richmond or
Baltimore, to redeem their issues at discount
of not over quarter of one per cent. This is
taking one step in the right direction. We hope
it will be the pleasure of the Legislature, at its
next session, to amend the law by requiring the
interior Banks to redeem in Richmond at par,
and that the Legislature will not stop in its
Bank reforms until we shall have but one sys-
tenn of banking, and that resting upon broad
specie basis, and requiring redemption as con,
tempated by the act above referred to, with
the amendment we have suggested, and sur
rounded by such safeguards as the past expert.
ence of our own State and others may suggest.
The fourfold increase of the Banks, in this State
IN the last four or five years, will give our citizens
an experience that will bring about the reforms
we hopefo alta much earlier period than if char
ters had not, in late years, been SO freely grant
ed. Nearly all the new Banks from forty to
fifty in number) have been located in rural dis
tricts, where, in most cases, they were not need
cd.
Banks cannot be legitimately used in buying
lands. building houses or making improvements,
and farmers require money in large amounts for
no other purposes. Banks cannot legtimately
supply the mechanic, physician or lawyer with
means to pay current family expenses. MOI
can they supply the merchant with capital
Thew may accommodate him with loan for az
amount for which he may find it more convent
ent to ask than to collect from his customers
-bnt even to him and to his customers, this il
but doubtful advantage. These banks mas
pay dividends, and to do II, loans must De MADE
inducements are held out to parties to borrow
bank bills who really have NO legitimate use fo
tbem-these, consequently eschewing the slow
but certain way to success IN their Ordinary
calinps. hope to make fortunes by some lucky
speculation. The Bank, unable to keep out 81
large circulation as it anticipated, Is obliged
to call in its loans, to the great Inconvenience
loss and sacrifice, and in many cases to the ruiz
of the borrower. Some OF these BANKS, perhap'
the most of them, are controlled by those wht
use them as facilities to grind the face OF th'
needy.
These and other evils which we might name
resulting from the establishment OF Banks in ag
ricultural districts, will bring about change II
our legislation in regard to Banks and Banking
that will, we have no doubt, greatly reduce tn
number, and give to those that remain, broad
er base and safer charters.
To whatever other cause some political econ
omists and fnanciers may ascribe the late imam
cial troubles, and the disastrous consequen
ces to the people of the North, East ant
West. the masses are most thoroughly con
yinced that they were caused by the excessiv
issue of Bank promises. The press and the peo
ple are demanding that bills shall realty repro
sent coin:
In New York an experiment is about to b
made in the establishment of q bullion bank
suggested. we believe, by the journal of Com
merce.n certainly very warmly urged by it. i
a recent number it gives the plan quite in detail
and saws that many of the most influential busl
mass men have taken hold of the matter, AM
that the officers of some of the leading Bank
favor the project. The following is succinc
statement of the plan as published in the pa
pers: IL.
"The plan is to found bank which shall dis
count only to the extent Of it's own capital. 1t
deposits are not to be used, any part of then
by the bank, but are to be retained always !
actual cash to the order of the several deposi
TORS: the deposits will consequently be always +
the full amount, on hand in coin. The rerenu
of the bank (other than the interest on its ow
can;tal) ia TO consist of small banking commits
sions charged to depostors; on small account
more ON large accounts less. The largest com
mission proposed is Ito of per cent, or 10 on
persons income of $4,000 per annum on large
accounts q small annual sum in lieu OF commls
sions. AS its projectors propose TO hmlt >, IN
dividends to per cent, these charges will ,
reduced with the increase OF business, ana WI VI
always be kept down to the amount actual
necessary to pay expenses. 1t is urged by tn
projectors that If this bank be in first rate hand
and consequently its credit perfect, its certlh
Gates of deposit representing actual coin in Ne'
York. will be used not to circulate as money
but for the purposes of remittance to an exten
sufficient to sustain the bank"
This is plan for the adoption of which th p
neople of Virginia are not get prepared. l
New York they have tried almost every imag
nable plan of paper banking, and suffered terri
blv the consequence of expansion and contrae
ton. which is inseparsble from any plan author
ling an issue of paper largely beyond the spf
Gle on hand to meet it. We trust our good pee