Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1858-08-26

'ins hso suspeuueu- COuu not uafe Cuhlinee" w
discount and pay tax of 5,per cent for the pr-
vflege, when they oniyreceived 6per cent: for the
use Of their: money" It evident that if2the
Banks Only rsalized 8 per cent: on their capital,
and had to Fay back per cent. of the same, that
they could not afford to do business anil loan their
bills on those terms. But this is not the fact, as
is we'll known, and regard it as very disingen-
nous statement of the case and intended 10 create
the impression that if the Banks were compelled
to pay the penalty Of per cent. they could only
make one per cent. on their capital, Gentlemen
are certainly aware, that such would not be the
true result, for tho Banks 10 this State have de-
ciared dividends ranging fromEs to 20 per cent:
often having on hand reserved profits, showing
clear gains of 20 Or 80 per cent, and according
to the estimate of the Comptroller General, as
high as 60 per cent. Take the suspended Bank Of
Ncwberry for instance, with o circulation very
little larger than the amount of her capital. She
has made in the first four months after the. pas;
sage of the Act of 1857 over 20 per cent. Deduct
per cent from the circulation, and it will appear
that after paying the s per cent, this Bank will
have realized about IS per cent, and it is stated
on good authority, that the Hamburg Bank since
the last Session of the Legislature has made, up
to June, profits, which, after deductng 5per cent.
on the circulation, would equal II per cent. on
her capital With these facts and figures before
us, we readily perceive how much truth there is
in the clamor raised by the Bank party, that
the collection of the per cent from the suspend
ed Banks would compel them to stop their opera
tions, and in fact, would be tantamountto for
feiture Of their charters. But it has been said
that the Banks would have been compelled in SELF
defence to contract their circulation and that they
could not continue to loan their bills with this
burthen upon their operations. am inclined to
think that this is an error. For a circulation,
take it, is indspeusably necessary to preserve the
other parts Of the Bank machinery in harmonious
action. The kiting and shaving wheels need this
propeling power to keep them in motion. 1t is
apparent therefore, that it was very impo!itc and
unwise in the Legislature to have relieved the
Banks from the payment of the S per cent I'M
posed by the Act of Assembly Of 1910.
In the article under review find these words: '1t
is true that the bills of the suspended Banks were
Mt depreciation of from to 2per cent, but for
the payment Of debts they answered the farmers
inst as we'll as the virgin gold. The merchant
who wanted exchange would lose the amount OF
the depreciation" &c. With regard to- the de-
probation Of the suspended Bank bills, this is far
short Of the mark. After the suspension Of the
Act of 1910, these bills fell per cent. below par,
and this amount was lost on large number Of
those bills in the purchase Of exchange, and
venture to assert that it is most egregious mig
take to suppose that the merchants would patient.
" pocket the loss rather than exact it back from
their customers, BY legitimately increasing the
price of their goods and groceries. Itis the habit
OF that shrewd and useful clnss of men to count
the cost of their merchandise first, and then set
remunerating prices upon it. The truth is, the
planters, principally, will eventually sustain the
loss Of every dollar Of this depreciation OF our
rency, and 25 per cent. superadded, to the meri
chants; hence these suspended Bank bills would
be very for from answering the purposes OF the
community as we'll as virgin gold"
Again, on the supposition that the contractlons
by the Banks before their release from the pay
ment of FIVE per cent. affected the price OF cotton
two cents per pound, Col. McCaw calculates the
loss sustained by the planters in South Carolina
as having been 81, 100000, and believe bis com
pution is about correct. To my mind at least, 1t
wears the seeming of sound reasoning and legiti.
mate deduction; but by what system Of logic or
rsiocnaton the conclusion could be deduced that
the contraction since the Act Of 1857 would not
depress the price of cotton equally as much as it
did before, am utterly unable to conjecture.-
+ have shown that the contraction not only contin-
ued, but that it actually increased after the pas
sage of the Act; therefore, by his own process OF
reasoning, it is certainly fair to infer that the loss
sustained by the planters thereby, would not only
to be as greet since as BEFORE but that it was con-
siderably augmented. and in all probability far
exceeded the sum he has designated. Indeed,
have very little doubt of the fact that the loss oc-
casioued to the planters by the direlictions OF the
Banks both before and since the enactment OF the
law of 1857 did not fall short Of two millions OF
dollars. and when we take into the account the
further loss, incurred by the community by the
depreciation of the value Of the suspended Bank
bills-whch was mainly owing to the suspension Of
specie payment having been legaized BY the Act
Of last winter, together with the loss Of the per
cent. justly due by the suspended Banks-the prob
ability is, that it has altogether reached, if it has
not exceeded, that enormous gum.
It is denied by Col. McCaS that England has
gold enough to buy our cotton, and he says "this
is far.fetched idea and not sustained by any ar
gument of political economy" Not being famil-
iar with the state of British and French finances,
will not attempt to dilate on the question as to
their ability to purchase our cotton; hazarding
the assertion, that if the prices Of cotton were
continued depressed below the proper rates for
great length of time by our Banks, (Which now
monopolze the trade,) Withholding the funds nec-
essary for the purchase Of the cotton, British
gold would certainly find its way to our markets
for that purpose. 1t was asserted in the Leglsla-
ture last winter that the gold had then been de-
posted in Charlesto to buy cotton and it was not
denied; and indeed, have very little doubt that
British gold had something to do in enhancing the
prices after the action Of last winter, for it is ap-
parent that our Banks had very little agency in
contributing to that result. Without doing Vio-