Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1859-02-13

the banker produces Tush mora general Injury than
the failure of an inliyidlAl. Blakers are not pro
dueers-they add nothing 10 the real wealth Of the
country They loan cut all the real capital they
have, without authority and without charter. They
loan out their credit two, three, FIVE dolars Of
! paper promises for one of metallic money on hand
They manufacture money out of cheap materials.
They have, in effect, the niog power, surrtn
dered by the States to the federal government
prominent member of the Constitutional Convention
Ct 1916, in Massachusetts,. said that nothing was
necessary to put a bank in operation but to ge3
charter, almost a matter of oOurse,) pay in with
stock notes. borrow thirty or forty thousand dollars
for few hours, and then scatter their countless
notes in the surrounding States the further off the
better for the banker, the worse for the people.
They may issue notes to twice the amount of sub
scribed stock If they subscribe one million, they
may issue two millions, aud be within the limits of
their charters, having no liability, individual or
corporate, to answer for one million. They may,
with their own notes, purchase estates with them,
aud thus become indebted to the country to an ex-
tent that personal credit could ever enable them
to reach.
What vast field is here offered for getting in
utDtbu 70 tue puDIc5 Without 1uuiVlQuaL or cOfD0-
rate liability to for such indebtedness
What other trade involves the fortunes of such vast
multitude of people, this trade of issuing tote or
selling credit If merchant or other trader fails
his failure reaches only a comparatively small cirs
Gle of customers but the bankruptcy of trader
in notes, or credit money, reaches vast multitude
of people The failure, even depreciation of the
notes of large joint stock bank not unfrequently
shocks the trade and dealings Of half million of
people, and inhlcis direct loss on fifty thousand
people. Yet these manufacturers of credit or con-
fdence money, are not liable Individually, and may
issue twice much they have subscribed stock
The legislature has secured to them the monopoly of
keeping the money of ether traders for long periods
of time They have the monopoly of the trade of
buying and selling bills of exchange or of furnish
ing the public with money at distant points They
have the monopoly of the business Of exchanging
their note for other notes, or of vending their
credit with the seal of authority attaehtd to these
printed notes by special statute. They create the
money of the country, aud no body but char
tered companies can create it. They are there
fore, TO all intents and purposes, public offs
GERS of the very highest grade of responsibility
Why should they not be required to give to the pub,
lie the most ample and satisfactory guarantees for
the redemption of their notes, and indeed for the
full performance of their public trusts, as we'll as
other officers whose responsibilities are not one hun
dredth part 90 great? We require security of trea
surers c0ns;ables, sherifs trustees; VIC require Sc
cIrity of guardians, executors, Administrators and
receivers, and other persons acting in a fduc airy
capacity, guarantee the safs custody and forth
coming Of funds deposited in their hands The
banks require securities Of their cashiers. What
safety can the public expect when men chartered to
sell credit exempted personally from the pay
msnt of their obligations, and required give
security to redeem their notes. VIXEN it is seen
that their greatest profit is made by keeping out the
largest possible amount of indeb,e lness against
themselves? We may be toll that the soiveDcy of
the circulating notes is based on the notes executed
to the bank and its effects. What would be thought !
of the act of taking the bond of public officer and
permitting him to keep it himself? "What binders
the managers of the bank" says Mr.. MeCulloch,
'from dividing these assets amongst themselves"
selling the notes given to them to innocent pur.
chasers, collecting them, selling the real estate
and removing the proceeds of the whole with great
dispatch from the hidden cells of close corpora
ton? If the public had not become habituated to
the idea of this chartered Lgal fiction, whereby per-
sons could get in their hands purchasing pow
to the extent of Millions the very proposition
to get up such concern, as joint stock bank,
which released the projectors from The liabilities
which all others subject to- ard which provided
security, would be regarded as auiacious eroute-
~, and Indicative of deliberate intention to swim
die. Indeed, if the most sagacious sharpers and
sdventurers, without capital, were combining and
to invent a scheme to defraud the
it is difficult to see how they could con-
rive better one than a charter for common
stock bank authorizing the geters up to issue twice
.he amount of the subscribed and paid up stock,
without individual liability or other security.
It is confidently asserted as the opinion of the
author of this communication, that those engaged
n the business of banking in Tennessee, are, as a
body, as trustworthy as the same number Of men to
De found in any other pursuit whatever, and that
here has been no instances within his knowledge CT
deliberate intended and fraudulent failures, as is
demonstrated by the desperate struggle made to the
asst to maintain their respective circulations; aud
hat they were borne down by excessive issues. But
his is no answer to the demand for security to the
community in vital matter the solidity OF the
currency of the country. The failure, whether by
raud or overtrading, produces the same results to
he community. There should be available means
ccessble to the officers of the law to secure the
ublic and not g mere confidence of the integrity
nd capacity Of men to fulfill their engagements.
that would be thought of a legislature which
hould repeal all laws requiring public and private
gents to give security for the performance of their
bligations relying solely on the integrity and ca
acity of the agents? What would be thought of
he legislature which should incorporate a company
coin money and prescribe no punishment for the
,suance of debased coin
The proposition to compel the banks to give Sc
urity for the redemption Of their notes was urged
early hall a century ago. by able men in England,
absolutely essential to the safety Of the public,
ven under their system where the banker was Ii p
bic individually. Some of the ables bankers and 3
crchants in their testimony before a committee I
the House of Commons took the same position, a
nd the opposing view Of the subject was feeblly
lstained. Mr.. McCalloch in his work on Banking |
ys: That in opposition 10 the demand for security
had been urged that the notes of bankers we're o