New-York tribune., 1874-02-24


| $14o,OOo,OOO; bank deposits from $56.OOO0OO to
| $127 100000. and bank loans from $200,0000 900
| to $525, 100000. In 1887 the crash came. The
| rickety fabric erected on the shifting basis of
| free banking and popular dellision was swept
| from the earth like West India village by q
| hurricane and for six years business was
prostratcd throughout the Union, while the
| nation expated its folcs. In the beginning
| of 1843 the bank circulation had fallen to
| S5S,5G4,000 the deposits to Sj6 0,000 and the
| loans to $25450O,0O0, and times remained
II "dull." Could anything be more suggestive
II than these figures Bank circulation actually
i less in 1913 than in 1880, hank deposits the
II same, and bank loans but % per cent greater,
while S27OOO,0OO less than in 1887 We cite
H these statistics to illustrate the prop
II Ostion with which we set 0ut-namcly.
H that even with bank notes ostensibly redeem
Il able in specie on demand. the idea that there
Il "can be no Oyerissues of bank notes and
Il "bank loans, because when not needed by The
Il community they are invariably returned TO
Il the issuers to save the interest paid on
"them," il dclusiOn. We speak OF banks
Il and individuals as we find them. Here are
II already two thousand banks in this country,
and it is not only probable but absolutely GER
tain that millions of dollars will be lent cyGiy
week on insufficient security.
1t 80 happened that in the years 1884 and
1885, Michael Chevalier, the distinguished
French political economist, was in the United
States and made q careful study of our habits
and institutions. 1t was in the very hight of
tho speculative madness Everybody is
"speculating, and everything has become an
"Obect of speculation. The most daring en-
"terprises find encouragement; all projects
find subscribers No occasion then for
banks TO force their issues on an Over-modest
community No lack of demand from would
be recipients, proilering what was doubtless
believed at the time to be sufficient secu-
"rityw But let us obtain from NJ. Cheyaliers
lively pen some idea of the spirit of those
times
In York building lots have been sold sufficient
for a population Of two million souls, aud al New
Orleans for at least a million. Pesten'i marshes and
naked precpce OF rock have been oougnt ani sod TOT
this purpose In louisiana the quagmircs the bottom
less alns gators, the lakes and cypress sSamp
with ten water slime, ana in the North the bed
OF the Hudson with 90 80 so feet OF water, nave
found numerous purchasers. Take the map OF the
United states place yourself on the shore OF Lake Eo
which twenty years was solitary Wilderness; as
cend 1t its head pass thence to Lake 81 Cilr ana
from that lake push toward the north across Lake
Huron go forward STILL thread your way through Lake
Michigan and advance southwark till the water fas
you; here you will find little town by the name OF
Chicago. Of the outposis ot our lhuei"u
gable cOuntrymen when they had posscs'oh
OF America. Chicago seems destined at some
future period, to enjoy extensive trade; /;
t will occupy the head of canal. which Is 10 connect
the Mississippi with the lakes and the ST. Lawrence
but at present it hardly numbers 1900 or 5000
Inhabitants Chicago has IN its rear country OF aniz
ing fertility but this country Is yet an uncutvated
wild Nevertheless the land for ten leagues round has
been Sold resold and sold again In small sections not
however at Chicago, but at York, which. by the
route actually Travelled, is 1000 miles distant. There
you may find plans OF Chicago lots numerous enough
for 100000 this than any city OF the
New World at present contains More than one buyer
WILL probably, esteem himself fortunate IT, on exanina-
tion he shall find not than six feet OF water on
hi spurchase-Ietter dated JohnstOwn. Pa Aug 1885,
We cannot better close this article than by
a further quotation from NJ. Chevaler, which
shows at once the cause and consequence OF
the state of things he saw, and presages the
dreary period of six years which followed the
final explosion:
lis provided indeed, that the banks shall pay gold
for their paper demand; but by the side OF TINS
clause which tends ep certain quantity of metals
~
1t is the power Of emitting bills in any number. and of
the sua OF one two three. five dollars. In prosper
times the emission Of paper Is abundant indefinite
as the necessity metallic standard to be felt.
in proportion to the confidence which prevails, the
metals disappear before OF paper; there
scarcely any left country. Since have been in
the United States, have not seen piece OF gold except
In tue mint No sooner it struck of than the gold
exported to Europe and melted down. When crisis
comes on demand for the precious metals increases
rapidly, because every one attaches more value to
positive standard than paper and the later the app
cation the remedy for the scarcity OF metals, the
longer does the last and the serious docs it
berome-l Letter, dated Philadelphia. Jan 8, 1884.
Subsequently, after the Bank war had be-
| come hotter, it was an unerring sign by which
Jackson Democrat was recognized, to carry
about and exhibit piece of gold. And this
at time when bank notes were convertible
| into specie on demand! If paper fabric of
| S149 900 circulation, $l27,O0O,000 deposits,
| and S525 100000 loans, could be erected in
| 1887 by means of system of free banking on
basis of about $5O,OO0,OO0, all told, of gold
and silver in the country Qeaving out coins
less than one dollar) what sort of structure
may we expect to rear by the same process on
basis of S4OO, 900 900 legaltcnder notes, even
with the utmost zeal ON the part of the public
| to exchange the lying promises of the banks
for the lies, one degree less removed, of the
/ United Statesf ."