Cincinnati daily press. [volume] (Cincinnati [Ohio]) 1860-1862, 1860-04-13
The Mechanics' and Manufacturers Ex-
change and Banking.

inc NICCnnulCB ana mnnutnCturcFh
change and BankinE.
Can the Exchange Committee on Banking
deduce no other lesson from the fact that
without the aid of paper-money facilities,
and on their own resources, the manufactur-
ers of Cincinnati have grown to the amount
of seventy-fve millions of dollars annually,
than that they need to be "fostered" by Leg
islative privileges for the manufacture of
paper money! Is this all the wisdom that
can be derived from the coincident facts that
Cincinnati has no banks of circulation, and
almost unexampled progress and prosperity
in all its business interests, and remarkable
exemption from the disastrous financial crises
which have swept over the country2
But admitting that any aid can be derived
from banking privileges, it is impossible from
the very nature of them that their aid can be
extended to all, or even to the greater num-
Der. To increase the resources of all in the
same proportion would only bring all on the
same level, and no progress would be made,
except to general unsoundness and de-
mand for greater financial stimulants. These
privileges are only valuable when special and
as the fundamental principle of banking.
They concede that if bank accommodations
were extended to all, or to all who were
equally deserving, the whole business of the
country would be inflated on a credit basis,
which they recognize as an unsound basis.
A banking system is regarded as sound in
proportion as its loans are small compared
with the real resources of the country, and
the fewer the number accommodated and
the greater the number doing business on
their own resources, the more healthy the
financial condition of the country is regarded
by bankers themselves.
This, doubtless, the Exchange Banking
Committee will admit although they think
that the redundant health of the financial
system of this city win bear some depletion
by a little Of the financial Sangrado treat
ment-taking portion of its own resources
and infusing large quantity of warm water,
or paper money, into the circulation. Legis-
latures Also recognize the restriction of bank
ing to an exclusive privilege as vital to its
safety, and however much they may regard
banking facilities as fostering the interests of
the country, they are extremely cautious
about making the blessing general
Do the mechanics and manufacturers of |
Cincinnati want legislative grants of banks |
for this city, which are to be managed on any |
principle by which banks ever were gov
erned; principles which all bankers regard |
as necessary to their safety? Do they want
special privileges for increasing the resources |
OF small proportion, and they selected from |
the most wealthy and best established, leav- |
ing the great body of them to their own re-
sources and obliged to compete with the mo-
nopolizing power of capital, created by
special privileges under the pretense of fos-
tering industry? Yet can any one suppose
that bankers will not select their paper for
discount from the best class and that any
bankers are going about like Good Samari-
tans picking up the wounded-the lame
ducks, pouring the oil Of discount into
their wounds and promising them aid ac-
cording to their necessities, until they are
able to stand alone? However Samaritan
like that would be- it would be regarded as
very unbusiness-like for banker.
As we remarked, the very essence of
soundness in banking is that.its credit shah
be restricted to but a small proportion of the |
business. Bankers recognize its restriction
to special privilege for the few, as vital to |
its safety. The mechanics and manufacture
ers of Cincinnati want no such institutions
nor is there any probability that they will
have them by legislative aid. No banking
law can pass the constitutional ordeal Of the |
popular vote in Ohio, not even the renewal |
of the present State banking law. 1t will |
find one political party making hostility to it
party issue, and the other letting it alone,
or else tying it to its neck and going down
with it.
But whatever may be the case in other
parts Of the State, or in the surrounding |
States, Cincinnati wants no banks of circula |
ton, and nothing is more palpable than the |
common error, that because the surrounding
States and rival cities have these banks, it is
necessary that Cincinnati should have them.
The business and the financial condition of
this city without Them refute that idea. The
closer the financial medium of this CITY is
kept to cash basis, the more will it become
the financial center of the West; and the
more the surrounding States which trade
with Cincinnati, initiate their currency. the
more will the real money flow, as to a
vacuum, to the market where it is demanded
for payment.
Instead of the imitation of the surrounding
currency forcing Cincinnati to the same
or placing her at any financial disad-
vantage, it results directly to her benefit and
tends to make her the financial center.
Wherever the circulation is nearest a cash
basis, deposits will be most valuable and will
accumulate. This may be seen in
the constant flow of deposits from the West
10 New York, which furnish large share of
The banking facilities of that city. If the
of the surrounding banks is re-
luired to be converted into cash when il is
lsed for payment at Cincinnati, the banks
will be compelled to make provisions here for
is redemption; therefore, they will give the
preference to bills presented for discount
which are made payable at this city; their
deposits will accumulate here; their New I
FORK exchange will come here to redeem
heir notes, and our banking facilities will be :
increased vastly more by this specie standard ,
nan could be done by any paper currency of /
ur own, which would necessarily interest
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