Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1884-08-06

fhe failure Of bank occasions no loss to
them. In word, one half Of the banking
system would be nearly % perfect ~ hu.
man institution san reasonably be expected
70 be 81 II were not for the fact thai the
suarantecieatnre spoken Of 10 based upon
debs which 10 annually diminishing by 4
good mary millions Of dollars.
In ante-bellum times, under the old sys-
term Of Slate banks, the partial or tempo
raly ''panic," II 90 Il may be styled. called
"suspenslon Of specie psyments." was
occssioned. by the poteboIders, who, be-
coming alarmed for any reason, hastenod
TO the bank 70 demand that the banks notes
should be redeemed In specie. Az the
bank rarely or mover had Q quantity Of
specie amounting to more than one fourth
or one third Of the sum Of Its circulating
notes, 1t wss no, . very diflcult matter to
compel the banks 70 "suspend specie pay
menis." The announcement was often
made, we think, that the bank itself had
suspended. However this may have been,
the suspension Of specie payments enabled
the banks 10 relieve the community, and
SET the wheels Of business again In
motion, By issuing as many circulating
notes ~ they deemed 1t expedient 10
put out. The suspension OF specie
payments caused silver aud gold to disap-
pear from the channels OF trade. II was
dificult-next to impossible-to get any
sort Of change less than fiyedollar note.
The strange slate Of things resulting may
be inferred from tho fact that In Virginia
an act Of the Legislature forbade any bank
TO pay check for less than five dollars, the
object Of the act being TO prevent the
circulation OF such checks in lieu OF
silver and gold. Sometimes what were
called shinplasters supplied the
place q the concealed specie. These
shinplasteJ were issued BY almost any.
body that chose 10 put them out The
banking .honss Of LATHAM b Co., in WASH
inRton city, supplied for years much OF Che
smalLnote circulation Of Virginia. II was
adeplorable state Of things. The present
sspersiion win hardly credit The stories
that could be told on this subject. But,
what some may consider strange, the census
Of 1890 shows shst the entire paper sircula-
ton Of the United etstes in 1850 amounted
70 only e707, lo3, lr7-s sum lees than Quo |
fourth Of the laper circulation Of 1ss4-in
fact, not one half Of the money now lying
idle oil the time IN the treasury OF tho Uni.
ted Etatesl
We nay one half Of the banking system
10 almost unexesptionabIe. That IL to
say, the currency Issued BY the banks II 20
well guarded against depreciation, ssd the
people are 20 we'll informed - TO how this
10 done, that there Is no sort OF danger now
81 any such panic ~ in former days caused |
Inc hanks to suspend specie payments.
Every body knows that the notes Of the
national banks are good, and II Is, there
ore, simply impossible that a "run upon
be banks' should DO occasioned now, as In
times was the ease. by the note
FOLDERS.
The depositors remain to be provided
or. They cause all the bank.troubles
nowadays. They are almost certain to
desire to withdraw their deposits at the
very time that 1t Is most ineonvenient to
the banks to spare the money. This sub
iect has been forced upon the attention Of
the banks and bankers OF the country by
recent events, and will be considered by
the American Bankers Association, which
IN at l.
New York. There is no other ques-
ton so important connected with Die
banking system Of the country, and
we are not surprised OF I'll that
our bankers have determined TO put their
heads together 10 devise some method Of
protecting the banks from the evils Of pam
les. We shy a "method OF protecting the
bnnks," but the fact Ia that 1t Is the deposit
tors themselves that are to be protected
from their own unwise scts, and the whole
community that 10 to be saved from suffer.
ing the penalty Of those acts. What will
be the outcome Of the deliberations Of the
American Banker Association cannot Be
soiesecu. One scheme 10 referred 70 In The
Row York World Of Monday. ~ follows:
"a chief topic Of the Convention viii be
The prevention OF panies and the adjust.
ment OF the financial and banking system.
20 ~ to protect the country from the fire.
qcent occurrence OF financial disaster. n
10 predicted that ono result Of the Conyen.
tion VIII DO 70 lake steps towards creating
large central bank, IN this city or Wash.
1ngton, which shall have power to issue To
banks and others . large amount Of new
bank cum ency for temporary purposes for
relief In times Of panic."
This scheme, II will be seen, y In Its OBJ
ject exactly the same with the one which
we have mentioned above ~ that adopted
BY the banks In ante-bellum days. Then
The hanks suspended specie payments and
issued ~ much paper money - they chose,
though the law forbade them from issuing
more than three or four tImes ss much a.
hey had specie TO redeem. The conges.
ion Of the channels Of trade was thereby
'cfieved, oil depositors who demanded
heir money received II. and business even
ually resumed lis vented aspect OF quiet
md safety.
We say the plan mentioned above Is "ln 4
b object" the same a. the plan adopted tn I
sr The old Ststc-bank system. But thst
"a plan would not answer now. Indeed,
would not be tolerated. The people Of {
'e United States win never hereafter agree
ut thousand Of hanks shall decide, each 9
y Itself. bow nU1h lrredeemabls circuls- !,
-L~n 49, A | =