Muscatine weekly journal. [volume] (Muscatine, Iowa) 185?-1890, 1859-06-10
From the Chicago Money Reporter. ]

A Clearing House for Chicago.
This matter is :gain being agitated by
some of our leading papers and business
men, the incentive thereto no doubt being
the heavy tax upon them occasioned by lie
high rate Of exchange.
If such an arrangement as the redemption,
in this city or some other central point, by
the Country Banks, of their circulation, can
be brought about, we think that the nler
camille part of the community must be ut
the bottom Of the movement.
The tax upon the business men has become
such, in the shape of exchange, or, we may
say, in the shape Of discount on uncurrent
paper, that some system is deemed essential
whereby all business men in this western
country can be relieved of the unnecessary
burden. We doubt whether all the Banks
and Bankers in this city have the ability to
force the Country Banks into this arrange
ment, and have no hopes of such result
until aid is received from legislative enact
ments.
Now, when will the pc ople of the western
country rouse up to the clear comprehension
of the swindle that is practiced upon them
by the Stock Banks of the West? Those
Banks, with few exceptions, never redeem
their notes in gold and silver, except when
they are "wound up'' by the Auditor
They never furnish exchange at the points
where it is wanted, and where their lying
promises to pay are gathered in the course
of trade. The system of Stock Banking,
without the Clearing House feature, is an
enormous fraud and self perpetuating evil
that will exhaust the West of its gold, and
end in vast extension of paper money and
a ruinous revulsion, before many years.
Just consider the operations of these Banks
probably having their abode in Wall street
New York-obtain $4,000 of State bonds.
With this start they organize a Bank, say
the bonds with the State Auditor, who is
sues them batch of bank notes thereon.
These notes are sent to Chicago or st. Louis,
be, at II to per cent. discount for coin or
and Merchants give countenance 10 this
kind of money. They all say, ''it's good,
perfectly secure" ETC., and we must take it,
else we will injure the trade of the city,
The coin or exchange thus obtained for
ed in another batch of State bonds, which
| 10 IlAu5 tAe UdSiS VI duObiltI uc" OauA vi
Wild cat creek Illinois; and the notes of this
new "Wild Cat" are in the like mann r sent
to the cities for sale, whereby more specie
or its equivalent is thus drawn from US, and
sent away to organize more such Banks.
Thus does the swindling proceed and
multiply itself without check or limit; the
country is filled with worthless Bank bills
that are never redeemed ; the specie or its
equivalent is drawn from US and sent to
New York to buy bonds, and for every
dollar so lost we get paper dollar in ex-
change. And intelligent people-iDluential
bankers see this living outrage on hon
est labor and legitimate banking going
on, and stand needless, as if paralyzed be-
tore tile evil The only safety, the only
permanent relief, will be found in putting
check on the expansion Of an irredeemable
paper currency in the Western States. Let
every Bank note that circulates be forced
to rec gnize the specie basis at some leading
business point. Then, if a merchant wants
Eastern exchange, and has $4,000 or slO,-
900 in Illinois or Wisconsin money, he may
90 to the Clearing House OF such money,
and get the gold or the exchange.