. Financial history of the United States . conditions were not sosettled, the results were less fortunate. Under the free bank-ing system inaugurated in 1839 there were nearly 60 failures;but of these one-half were in the first five years. It was dur-ing this period that there was developed in this State the planof basing issues upon deposits of approved securities, a planwhich was subsequently utilized in the establishment of thepresent national banking system. In the Western Stateslosses by bad banking were greater; in Indiana 51 of thefree banks and private institutions failed between 1852
. Financial history of the United States . conditions were not sosettled, the results were less fortunate. Under the free bank-ing system inaugurated in 1839 there were nearly 60 failures;but of these one-half were in the first five years. It was dur-ing this period that there was developed in this State the planof basing issues upon deposits of approved securities, a planwhich was subsequently utilized in the establishment of thepresent national banking system. In the Western Stateslosses by bad banking were greater; in Indiana 51 of thefree banks and private institutions failed between 1852 and1857, with a serious loss to note-holders as well as to othercreditors. On the other hand the State bank of Indiana,as well as that of Illinois, was conservatively managed andpresents an interesting illustration of the possibihty of soundlocal banking. A notable example of banking in its worstform may be found in the annals of Michigan; tricks were $700,000000 $ 600,000000 $500,000000 $400,000000 $ 300,000000 $ 200,000000 $ 100,000000. t 18+0 1845 1850 1355 1860 1863 No. IV. —LOCAL BANK STATISTICS, 1834-1863. §112] Local Banking, 1837—1861. 261 employed to deceive the official bank commissioners as to theamount of specie on hand; the same boxes or bags of speciewere quickly transferred from one institution to another, toperform a continuous service of reserve. In the words of thecommissioners, gold and silver flew about the country withthe celerity of magic; its sound was heard in the depths ofthe forest, yet, like the wind, one knew not whence it came orwhither it was going. In one instance it was found that thealleged box of specie showed a stratum of gold and silver butall beneath was nails and glass. With the best intentions itwas hard to keep in order the Western banks in remote sectionsor on the frontier. The question of the right of a State to establish under itsown control a bank with power of note issue was finallydecided by the Supreme Court under the influenc
Size: 1246px × 2005px
Photo credit: © Reading Room 2020 / Alamy / Afripics
License: Licensed
Model Released: No
Keywords: ., bookcentury1900, bookdecade1900, booksubjectfinance, booksubjectt
