Banking theories in the United States before 1860

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Monograph

Identifikator:: 1755492553

URN:: urn:nbn:de:zbw-retromon-133529

Document type:: Monograph

Author:: Miller, Harry Edward http://d-nb.info/gnd/1055250875

Title:: Banking theories in the United States before 1860

Place of publication:: Cambridge

Publisher:: Harvard University Press

Year of publication:: 1927

Scope:: XI, 240 S.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Part III. Bank notes and bank deposits

Collection:: Economics Books

PRINCIPLES OF NOTE ISSUE 165 not less than two million dollars “ought to be freed from the trammels of State legislation, and recognized as furnishing the material for a sound federal currency.” ! He would make national banking free to all who complied with certain specified conditions, and would allow the state banks to continue to issue notes for local circulation.” The pamphlet contains little that is significant other than this interesting early idea of a national banking system. Several suggestions, prompted in part by the example of the Bank of England, were made for a national bank in whose notes, themselves redeemable in specie, those of the local banks should be redeemed. Bollman outlined such a “bank of banks” at con- siderable length, although, characteristically, his interesting pro- posal had a ring of implausibility and eccentricity when developed in detail? The state banks were to get the notes of the national bank by borrowing from the latter. The notion of a central bank, holding surplus lending power upon which the other banks could rely in times of difficulty, oc- curred to few, apparently. Three writers seem to have held that the second Bank of the United States was such an institution.’ “Wherever national banks exist,” wrote one, “to them has been confided the duty of procuring a treasure capable of sustaining nearly the entire paper circulation; and it is the only sure depen- dence. The country banks in England never kept more specie than in the proportion of one pound of gold to ten of paper, and theaccounts of several of our state institutions exhibit similar results. Indeed, one large reserve is vastly more economical than a great number of small ones.”’ © ! W. R. Collier, op.cit., p. o. 2 Ibid., pp. 9, 10. ! Bollman, Plan (1816), pp. 39, 40. Cp. Barker, Private Banking (1819), p. 18. ' Bollman, Plan, p. 39. A national bank, with branches throughout the country, which should rediscount the commercial paper of other banks, enjoy a monopoly of note issue, and have dealings only with the government and with the local banks, was outlined in con- siderable detail in Hunt's Merchants’ M agazine for 1856. See E.Y. C., “A System of National Currency,” xxxiv, 20 ff. 5 Lawrence, ‘Bank of the United States,” North American Review (1831), xxxii, 558; Anon., “The Public Distress,” American Quarterly Review (1834), xv, 525, 526; Anon., 4 New Financial Project (New York, 1837), pp. 20, 2I. § “The Public Distress,” American Quarterly Review (1834), xv, 525.

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