Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1859-11-10
x.o,ri,v fo- Bauk ISSUES.

Every month or two we hear % the creditors OF
stock banks sustaining heavy losses by fraud
failure or defalcation. Such cases have been ire-
ouent in our own State, and in others which have
adopted the same system of charters. Now as the
Legislature has no right under the constitution OF
Tennessee to charter any Bank except for the public
good it is the first iuty of the Legislature ia grant
inc charters Of incorporation to take care that the
public shall receive 20 injury therefrom Under
ur present system Of charters It is evident that the
people are not sufficiently protected There is not
sufficient security for the redemption OF bahk ISSUES.
The cases OF the Bank Of America, Citizens BANK
and others. establish that proposition
The same evils that have resulted from the ms
management of other stock banks might at any time
occur under the charters Of the Union and Planters
Banks. There is defect in the system ~l'cR AZ
lows these abuses and the only guarantee the people
have against oppression and wrong from any OF ueSe
hanks ia the good faith fOrbearance OF their OH
GERS.
II will not do TO rely on any such security where
the rights and property of a whole people are AT
stake. Although honest men may to-day cohuu"'
the affairs Of the principal stock banks IN the STATE
we cannot tell how long this viii continue TO De lhe
case We cannot tell how soon ayarIce, seIlshneSs
and cupidity may direct the policy OF tAose instu
sions. Experience teaches that even bank oiscefS
are not immaculate and may yield to temH1atloi'
Let us keep them out of the way of temptation.
Now. according to our system Of stock banking,
the noteholders have no assurance, except the
honesty of officers chosen by the interested corpora
tors, who, 40 Colonel Netherland says VIII ire
oueutly commit acts in their aggregate capacity
which as individuals, they would blush to JUSTIFY
that the issues Of the banks whose paper they hold
are not ten or twenty times the amount OF their
capital
The recent case of the Bass River Bank in Massa-
chusetts and other instances show that the state
Jpents of Bank officers are not sufficient evidence
of honest dealing. What is there in our banking
system to prevent the stockholders OF our banks
from increasing their circulation fifty or hundred
fold buying up the property Of the State and NOV
inr off with all their effects leaving perfectly IRE
deemable currency in the hands Of the people: Such
tbiprs have been known in States where. like ours
no security has been required for the redemption
OF Bank issues.
In abiding TO the recent happening Of suce case
the Boston Post of Nov. lst, says:
Every case like :he Bass River makes US fee
more deeply the prOpriety OF having every bank OIL
the Stale secured by some sound property entirely
independent of the institution that creates 1t DOT
as regards the property and the care OF IT. EVER.
hin onqht TO be secured by property in the hands
the government
Such security is absolutely necessary to protec
the people against frauds failures and defalcauon
on the mart of stock Banks. The knowledge tina
sucb security existed. would deprive the Banks o
the power Of getting up panic, depreciating thei
own papcr. and buving it UP at 4 heavy discount a
has been done in some instances. 1t would restric
the circulation Of Banks 10 the exact amount
their capital, and would stop the issue OF ereu
it paper for the redemption OF which there Is notL
ing substantial in the vaults Of the Bank or else