Year: 1859

the debts created by the inAations. Thus il
it is no indication of the prosperity or advers
ity of a country that money is plenty o,
scarce. Prosperity is only measured by the
actual productiveness of that country. X


Banks of issue can only be useful to the
wants of Commerce while it facilitates the
Exchange of created commodities Scarcity
Of money arising from vast increase of pro-
duction is indicative of prosperity.


1t may therefore be safely asserted that
the exports must equal the imports, and if we
sell more productions than we buy of articles
for consumption, we are prosperous.


Paper money is useful when based on coin,
dsllar for dollar. 1t is then convertible, con-
venient, safe, and advantageous to trade
But paper money is successfully forged, while
bogus coin is easily detected.


If there is not the greatest confidence in
paper money, it is curse instead of help
to Commerce. Paper money redeemable at
places in the far West, founded on State, or
U. S. Stocks is unsafe. War may ensue,
and the stocks depreciate at once, heavily
Then, the delay of getting securities to the
markets in the East is a damage to Com
merce, and loss to the bill holder, while to
wait long for its redemption is equally as
bad.


The "runs' made by brokers, and their
combinations against certain issues some-
times, weakens confidence in money, and
causes draw back on Commerce, and a loss
to the bill holders.


If Minnesota produces next year $780,
| 600 surplus bushels of grain at value of 80
or 40 cents each, she can employ and take
care of $4,000 of home paper currency
This amount will increase the next years pro-
duction, population and commerce.
The Lecturer then explained at length
some of the troubles and inconvenience ar
rising to merchants from tho paper currency
| they are compelled to use These evils could
| be prevented, however, in a great measure
by Legislation.


When money is undoubted in safety, and
security, its functions are valuable, and bene-
| fits all departments of industry. But paper
money has less value than coin, because it
is liable to destruction, wearing out, &C., tho
| it is more convenient.


Exchange on New York costs more for
Minnesota currency than it does in Wiscon-
sin or Illinois money, and less than either, if
bought for gold. Thus, this want of conf
dence in the money costs Commerce the am
| cunt of the discount.


Productions, if sold for gold, will bring a
less price than if bought in currency, for it
costs more to move gold about, and its indes-
tructibility and fixed value makes it more
sought after. Thus, paper money is an aux
iliary to Commerce and productive Industry,
if confidence in it be established but an enor-
nous tax on it if it be wanting. More wealth
can be produced in given period by the use
of paper money than by the exclusive use of
coin and Exchange. Coin is the heart from
from which flows the vitalising principle that
regulates, increases and facilitates Commerce.
A paper currency that has not this found:-
ton depends solely upon the whims of cred
it or confidence.
The Speaker concluded


We are led to enquire, from these general
rules and principles, can a Bank of issue in
Minnesota be sustained2


To answer this it is necessary to enquire,
first, if the balance of trade is for or against
our State. If we export larger amount in
value than we buy from abroad we can
sustain State currency to the amount of the
balance in our favor and no more, unless We
base the issue on coin, dollar for dollar.
mean we cannot Bank on any other basis
safely and proftably.


Our exports during the past year about
balance our imports, according to the most
reliable calculation we can make with the as
sistance of the most reliable estimates which
has been made by others.


| From this we conclude that Banks of issue
in our State were premature, and could not
have been successfully and proftably carried
on, if they had each and all been based on
United States stocks with only 25 per cent
in coin on hand, except where they were
owned by men whose private capital could
sustain them with coin, dollar for dollar, if
necessary.


| Most of the places of issue were remote
from the commercial centres, and thus mac
cessible and expensive to convert their cur
rency into coin, which created suspicion of
their good faith personally, and this alone
would destroy them, sooner or later, if no
other cause had aided to discredit them.
| What, then, does the business of the coun-
try, together with sound commercial trade,
demand of our currency?


| 1t first demands above all, that if Banks
are allowed to exist, that they be founded on
gold and silver.


Thus for 66a dollars in coin, allow an issue
Of 100 and no more, in paper.
! Make each stockholder liable personally to
double the amount of the stock held, whether
| paid in or not.


Any failure to pay specie for their notes on
demand, to work a forfeiture of the charter,
and their assets to be placed Immediately in
to the hands of Receiver and wound up
Require the Bank to redeem in specie at par,
land without discount) their bills at the place
of issue, and also to redeem at some general
clearing house at given commercial centre
If they sell exchange on the East, that they
charge no more when it is bought with their
own currency than when bought with gold
under proper penalties.


Limit the interest, as in Illinois, to 7 per
cent. per annum, or per cent. at most, and
forfeit the whole interest if more is taken or
received, directly or indirectly.
If Banks of issue are allowed on stocks,
require 33 per cent coin to be kept constant
ly on hand for redemption of their bills. Re-
quire the issue to be 10 per cent. less than
their actual selling value in New York, and
no stock of any kind to be received by the
Auditor, until one installment of semi annual
or annual interest has been paid in cash at
the place of payment prescribed therein.


That the Auditor shall not allow the sub
stitution of one security for another, until he
has given sixty days notice in public news
paper printed where the bank is located and
at the Capital of the State in which he shall
state the stock to be substituted.


Each bank to redeem its bills in coin at
the place of issue, and every bank to have
one common place for redemption at the most
commercial and accessible point in the State.
Any failure to pay specie on demand shall
work forfeiture of all their franchises. And
their stocks to be sold on 10 days notice.
as in Illinois biI-holders to be first paid
pro rata.


In case of an assignment of a Bank on q
failure, forbid any such from preferring credi.
tors.


Limit the amount of stock deposits for cur.
rency to three hundred and fifty to four hun
dred thousand for the incoming year, and moi
to exceed one million in ten years and then
20 to work with all the means in your power
both intellectual and physical, encourage the
most marked economy, both in public and
private affairs, protect the sacrifice of landed
property, by wise Legislation look steadily