The record-union. [volume] (Sacramento, Calif.) 1891-1903, 1892-09-21
WILDCAT NG-RETROSPECT-
I'VE.

The Democratic party proposes, by its
platform. if it is put into full power, to
repeal the 10 per cent. circulation tax law
that runs against State banks. The Repub-
liean party has not forgotten 1857 and its
cruelties, and proposes to keep the thumb
down upon similar iniquity. Citizens
who were then too young to realize it can
easily ascertain what the conditions were
with 1,50O State banks in thirty States
flooding the nation with shin-plasters
Nothing was more uncertain in those
days than the value of money" The
man who did not go about with volumi-
nous ''Thompson's Detector' in his coat
tail pocket, powerful lens between his
thumb and finger and bank note quota
ton list in his breast pocket, was not
abreast with the times, and could not
swear at any moment if he were worth 10
cents or 81, 600 in paper cash.
In those days haystack and a black
smith shop at a crossroads constitut ed
town enough in which to start bank.
Wind, cheek and a few thousands for
capital were all the essentials for a be-
ginning in the business of grinding out
notes. After the notes were afloat the
capital could be drawn by the sub
scribers, who would replace it with the
banks crisp fresh issue, and before any
body could gather enough of the rag
money to make call for redemption the
bank would vanish into thin air.
If, however, the demand came before it
was time for such concerns to collapse,
redemption would go on by devices of
delay, as, taking up one bill at time and
redeeming it in coin treated to the "red''
over the office stove, and shoveled to the
counter on pie plate, where the bank
burster could blow and cool it at his leis-
ure until the clock struck 8, when down
went the window and the bank hours
were over until next day, by which time
the bank of Squat Ham or of Pin Hook
would be only a thing of memory and
regret. But week later under either
the cid or new name it would resume
and await the next ''call."
We know of one bank of $3.50, 600 issue
in Indiana, the entire business of which
was transacted at the counter of the six
by nine grocery, where the President of
the concern sold sugar and nigger-head
twist, while the Cashier sprouted potatoes
in the back yard, and the Teller drew
New Orleans molasses in the cellar. We
made ''calp' on that bank in 1867 for a
meager $500 redemption and received the
legal tender of s. in small silver. where
upon the bank closed, never to reopen.
And that was but the experience of hun
dreds of others.
The rascality of that day of untaxed
banking went so far in the West and
Middle sections, that not even a small
part of subscribed capital was paid up in
many cases. One scheme was to sub
scribe, give one's note for the amount,
open the bank, print the notes, issue
them as loans to the subscribers, who
would thereupon pay them in to take up
their subscriptions, and thereafter, hay
ing foated the issue, the bank would dis
count the "debt," or cancel it, and the
concern would actually be afloat without
single dollar of real money ever having
been in the strong box.
An exchange tells US how the issues or
bank notes were often foated, or forced
into circulation:
The great thing was TO float them at a dis
lance so they would not come back for re-
dempuon. To accomplish this banks in
widely distant localities would exchange
notes. Agents would be sent into neighbour
ing States to exchange notes for Others at
hotels and stores. Loans would be made on
the express stipulation that the notes were not
to be put out near the bank making the loan.
AS a necessary result there was immense fric-
ton or loss in money transactions. New York
exchange was frequently quoted at % per
cent. premium at Chicago. The New York
discount on the bills of the bestknown South
eTn and Western banks was from IL to 21a
per cent. The bills issued by small banks in
those localities, though the banks were per-
feeuy sound and of good repute in their re-
spective towns, would only be taken at from
3 TO 10 per cent. discount. This was on ac-
count OF the general uncertainty and distrust
The Governor of Indiana, in message
to Legislature of that period, said: 'sThe
Spectator comes to Indiana with bun
die of notes in one hand and the stock in