Arkansas true Democrat., 1858-02-16
Tho Banks of Tennessee.


 The legislature of Tennessee has passed an act respecting the banks of that State, the main provisions of which are as follows:
 l. "The banks to resume specie payments on the 1st of Nov, 1858"
 ?. After the 1st July, 1858, no bank to is- sue or pay out any note of less denomination than five dollars"
 3. After the 1st of January, 1859, no bank to issue or pay out any note of less denoml- nation than ten dollars" Honor to whom honor is due. In thus prohibiting her banks from paying out any notes of a less denomlna- ton than ten dollars, Tennessee is taking the lead of her sister States in currency reform Missouri once had this policy, but she foolishly abandoned it.
 f. No bank, agent, person, or corporation, licensed to do banking or brokerage business shall pay out, for circulation, the note of any corporation or association of individuals, which has not been chartered by the State of Tennes- see." This provision takes effect immediately, and is iudicious one. Without it, Tennessee might be flooded with the small note issues of other States. At the same time the provision is so carefully worded that 1t does not prohibit brokers from buying the small notes that may be brought into the State by travellers, with the intention of sending them back to their place of issue. It only prohibits their circulating such notes in the State.
 5. "No bank shall pay out the notes of any | IL ,,-+ +bi Ctata it's branches" And "no bank or branch bank l shall issue or pay out any bank note not on its 1 face payable upon demand at the counter where l issued.'
 Heretofore. in even the best of times, the banks in Tennessee have been systematically euadinq specie payments. This has been effect | ed bv arrangements among themselves through which bank or branch in the mountains would circulate not its own notes, but the notes # some bank or branch in the Eelghbor- | hood of the Mississippi river: while the bank or branch, in the neighborhood of the Mississippi river would return the favor, by circulating, not it's own notes, but the notes of some bank or ] branch in the mountains. They all protessed
 
 notes at such distance from the place of issue l that they could not conveniently be presented for payment For many years the currency ot 1 Tennessee, though nominaAy, has not been ac- t,.aHy convertible into specie. Hence the high rate of exchange on New York, which has usually prevailed al Nashville and Memphis. 1 This provision of the act just passed, will, if t be carried fathlully into effect, put al end to this kind of bank trickery, and give Tennes- see paper currency really convertible into | specie Unfortunately, 1t does not take effect 1 till September 1859, more than year and half from the present date. Even when the banks of Tennessee shall profess to resume specie payments, they to be permitted, for nearly year, to systematically evade them, after their oli and approved fashion. G. No bank is to trade or traffic, either di- 'rectly or indirectly in the legal currency, or in uncurrent bank notes' This is we'll Such trade or traffic, when necessary, belongs to the brokers.
 ! '. "No bank shall, so long as it remains in state of suspension, pay over any dividend, or profits, except such as may be due to the State.' This is right. It will be a strong inducement to the banks to resume specie payments as soon as they conveniently can.
 8. No bank shall hereafter pay interest on money on deposit" This is judicous pro- vision. Money lent in this way to banks, k always a temptation to them to extend their operations beyond the bounds of reason.
 9. No bank, while it fails to redeem its notes in gold or silver shall be permitted to sell exchange upon any place in the United States, for a higher premium than two per cent" This is well. It deprves the banks of one great in | ducement for remaining in state of suspension.
 To- "No new banks are to be established under the " free-bsnking act," and none of the existing free banks" are 10 be allowed to in- crease their present circulation"
 IL Each bank is hereafter to make to the comptroller, quarterly returns of its condition, which returns are to be duly published in the newspapers.
 The remaining provisions of the act are de- signed to give force and efficiency to those above enumerated.
 If our neighbors in Tennessee faithfully car " out the provisions of this act. they will have, not an absolutely sound currency, but one ap- preaching to soundness much nearer than any they have hitherto enjoyed. And they will find that just in proportion as they opprox- mate to state of sound currency, just in that proportion will they approximate to state of sound credit also.