48 G. S. CALLENDER 



least a year and often more. The capital required to supply 

 this demand not only did not exist in these new states, but 

 it could be supplied to only a limited extent from older slave 

 states, since slavery prevented that accumulation of capital 

 which would have taken place in a free community possessing 

 the same favorable economic conditions. 



The planters of this region had therefore to attract capital 

 from the north and from Europe; and for this purpose the 

 credit of individual planters or of such corporations as could 

 be formed in a new country was as inadequate as it was in 

 northern states to secure funds for canals and railways. 

 Nothing was left but to make use of public credit to supply 

 this deficiency; and every new slave state in the south from 

 Florida to Arkansas established one or more banks and 

 supplied all or nearly all of their capital by a sale of state 

 bonds. Many of the banks were known as " property banks," 

 and were designed especially to furnish loans to planters. 

 The business of all of them consisted in providing the capital 

 for producing and marketing the cotton and sugar of this 

 region. Thus in the southwest, where nature already pro- 

 vided an adequate system of transportation, the state banking 

 enterprises formed the counterpart of the internal improve- 

 ment movement of the north and east, 



