Gold Hill daily news. [volume] (Gold Hill, N.T. [Nev.]) 1863-1882, 1865-02-24
NATIONAL BANKS.

AhNA4SAs&A A&1NASs
In pursuance Of its declared intention,
the Union comes out this morning with an
article upon the subject of National
Banks, showing the profits which might
be realized by the introduction of that
system among US, and the benefit to be
derived therefrom by the community,
through the consequent increase of the
circulating medium. About ten days
since, we published an extract from the
Cincinnati Gazette, setting forth the evils
connected with the National Banking sys-
tenn, rapidly becoming manifest in the
Eastern States, and which were receiving
much attention from the Eastern press.
The Union having regularly opened the
campaign in favor of the system, system
which the reading of the Eastern exposi-
ton has convinced US is fraught with evil
to the community where it exists, induces
US to republish to-day the article from the
Gazette above referred to. Financial mat
tiers appear to be the speciality Of the
editor Of the Union; but even he will ad-
NIT the soundness of the maxim, "Er-
perisntia doeet," and that the Eastern
editors have advantages beyond his own,
in observing the workings of the system
which has for some time been in active
operation under their own eyes. When
one can say, "an of this I saw, and part
of this I was" the statement of such an
one is entitled to more weight than his
who is merely theorizer or an observer
from distant and Instantaneous stand
point. Here is what the Cincinnati Ga
=stte says about National Banks:
The country has suffered but little thus far
from National banks, but it is plain enough
to see that the foundations have been laid for
a bubble Of the most extraordinary dimen-
sions, and the superstructnre is going up
rapidly. National banks are running into
the widest kind of wildcat system. There is
no doubt at all about this. We need not say
that we do not refer here to the banks based
upon bona fde capital, and organized for le-
ultimate purposes; but it Is known that the
ropes are being arranged for operations that
will, so far as regards the imitation of the cur
rency, throw the old, broken-down system Of
Indiana and Illinois into the shade. What
else can be expected Never was such an
opportunity for making money presented.
Let US look at it: A bank is organized with
a nominal capital Of 100000. The sum Of
100000 is subscribed and paid in. This is
invested in United States bonds, which is de-
posted with the Comptroller, and S9O,OOO IN
currency issued. This is used indirectly for
stalment of SSl 900 is obtained in currency.
This is again used, and another instalment
of $4,000 in currency is received. Thus the
bank has, on bona tde capital OF 100000,
secured and deposited bonds to the amount
of S2Tl, 900, and has in circulation notes to
the amount of S244, 900. Put these together,
This is almost equal to ANYTHING the Indiana
and Illinois sharpers ever got up IN their
palmiest days. Now let US look at the
profits;
Interest on bonds equal in currency to. .s37, $40
Interest on circulation at per cent?. l4.64O
Total interest $50, $50
We have deducted from the currency 25
per cent. which banks are required TO keep
on hand. But the managers who 90 into this
kind of business will do better than that.
How this may be done, we need not stop to
explain. 1t is very easy to make an average,
by having large amounts of currency two or
three times in a month, to swear by. 1t is
thus seen that on a capital of 500, 900, a
company of gentlemen may realize profit OF
So, $50 per annum from the circulation
alone. If gold should go higher than 24O,
the profits would be still larger. It would be
in the direct line Of interest with those bank
ers TO initiate the currency and enhance the
price of gold. But about redemptons. Isn't
bank required to redeems Yes, in green
backs; but they are not asked to redeem in
anything. There would be no object IN it.
If we had specie payments, there could be no
such banking as this we describe, but there
being no payments of any kind, notes are
set ahoat, and do not return to annoy their
makers.
How do the citizens Of Nevada like the
pictures Our neighbor of the Union ar
CUES well for the profits which would ac-
crue to the bankers and the article which
we have quoted from the Gazette seems to
corroborate the position that the bankers
have very good thing. Inasmuch, how
ever, as all can not be bankers, and as we
propose to remain among the outside mass
of community who would be the victims
of the swindle, we raise our voice in de-
nouncing the system, and publish the
above warning for the benefit of our fell
low citizens.