Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1874-07-29
THE BANK PKOPOsITION.
How IL Locks TO an ora and Tried Pub
lie sOryant-EEe fs opposed TO It,
and FRvOrs Free Banking.

FAYETTEVILLE, TENN July 2 lS1i.
Messrs. NJ. c. Galloway and Marcus Wright:
GENTLEMEN-Iu the Nashville Union
and american of yesterday there was
republished from the Memphis APPEAL
an open letter from Comptroller John
C. BuIeh, addressed to you, and inform
ing You that he cOntemplates recOm-
mending TO the next legislature to es-
tablish q State bank with five million
dollars capital as a revenue measure,
the capital for the proposed bank to be
raised by the sale of State bonds, as the
writer states in his letter, viz:
"My elan would be to re-establish the
bank ON the same general principles up
on which the old bank was established,
making its Issues receivable for taxes
and all other dues of the State. To pro-
cure necessary banking capital, issue
So, 600, 600 of six per cent. fOrty-year
bonds. To secure prompt
sale and high price for these
bonds, l would not only pledge the
faith, honor, and credit of the State for
the prompt payment of both principal
and interest, but l would also apprO-
pirate and set apart the profits of the
bank; first, for the semi-annual pay
ment OF the interest on the bonds, and
after the lapse of asuitAble time would,
from the same source, provide an annu-
al sinking fund for the payment Of the
principal of the bonds. Thus, believe,
these bonds might be sold for ninety
cents on the dollar, and the sum of
"a. 500 900 reaiized for banking puT-
poses. In making this calculation as to
the probable sale of the bonds, l take il
for granted that our next Legislature
will not violate the faith, honor and
credit of the State, now pledged
for the payment OF the principal
and interest of its bonded indebted
ness. Should l be mistaken in this ex-
pectatiOn, cannot foretell how value
less Tennessee bonds and Tennessee
credit will become. Under the old and
safe banking rule of issuing three for one,
we could, on a banking capital of 81, 500
000 issue a circulation of Sl3, 800, COD.
In field demanding great banking IA
cilities, and comparatively unoecupled,
we might safely calculate upon Keeping
$4,000, 600 of this circulation in active
employm | think il probable that
at the reasonable rate of six per cent.
interest, and il should not be higher,
every dollar of the circulation could be
constantly and pTofitably employed"
E A rather grand scheme and bold re-
commentator, to come from the imam
cial agent and guardian OF the peoples
inteTest-that people already grOaning
under the burden Of funded and re-
funded bonded debt, with inevitable
ruin and poverty certain in the not dis
tant future, if the payment of the unjust
debt is forced upon the productive labor
of the pe0ple of the State. From the
same copy Of the Nashville Union and
American which contains the comp
trolleI's letter, and from which the
above is taken, is the following extract,
taken from the financial article in that
paper:
sTennessee bonds are quoted in New
YORK at rs asked for those carrying $3.50
accrued interest, while sales are reported
of the funded series at 81"
That is a Tennessee State bond for one
thousand dollars, bearing six per cent.
interest per snnum, and with 1880 uu-
paid interest due ON each bond, only
seventy-eight cents ON the dollar is