THE FARMERS' REGISTER. 



333 



conimodiiive in iIio.«p places. And thus it is as 

 ea?v, nnil is as iiiiicli a reixular hnsine?s, (or our 

 merchanis to make paynionts in Enniand, where 

 an American bani< note never finds its way. as in 

 New York, where they sometimes are sent, and 

 would often cjo, if in jrnod and deserved credit at 

 home. Thus, (or distant payments, or transmis- 

 sion, it must he admitted that bank paper is not at 

 ail neces^arv, nor even ihe most convenient means 

 (or ren)iMance. 



For payments and transmissions hel ween neiL^i 

 boririiT t()U'n>', as Kichmond, and Norlblk, or Pe- 

 tersbur<r, l»ank notes or hank checks are now used 

 as most convenient ; hut the same mijihi he near- 

 ly as well e/fecied, il" 'here was not a bank of cir 

 culation existinu. A ceriificateof the deposiie oC 

 money in a bank merely of deposite and discount, 

 in one oC these towns, w. uld serve lor transmis- 

 sion to another just as well as a bank note. And 

 all thai would he necessary would be to pay a 

 very small premium to the banks as compensation 

 for negotiating tliese exchanges ; and, when re- 

 quisite, the banks would have to settle with each 

 other the genera! balance upon a multitude of 

 such transactions, carried on through a considera- 

 ble time. Such transmissions of payments to and 

 fro would, in the general, nearly balance eai h 

 fiiher ; so that there would in (act he rarely any ba- 

 lance necessary to be remitted in specie. And for 

 conducting such transactions the banks would be 

 well compensated by receiving amounts so small as 

 scarcely to ex<;eed the value of the postage and 

 the risk, in sending a bank note by mail. 



XXIII. Savings'' banks, or banks of deposite and 

 discount only. ' 



Besides certifii-ates of depositee, or credits for 

 deposites on Ihe books of a bank, there would be 

 oiher means (i^r convenient payments and dis- 

 tnnt transmissions, in the certificates of deposiies 

 in savings' banks. These carry interest, and there- 

 fore are more valuable to be retained by holders 

 than certificates of deposiie in other banks; and 

 would be an acceptable medium of payment wher- 

 ever the character and responsibility of the bank 

 had become known. 



Thus, for all purposes of distant transmission, 

 and for which bank paper money is usually 

 spoken of as indispensable, and for which, indeed, 

 that currency does not serve well, and is not now 

 generally used, there would be much better 

 facilities in bills of exchange. And for payments 

 nearer home, and especially for small sums, cer- 

 tificates of deposite would offer as convenient, 

 safe and cheap a medium as now exists, or could 

 be possible to obtain. But it may be objected, 

 that this would be merely laying aside one kind of 

 paper curreney, (bank notes,) to resort to another, 

 in certificates of deposite. Even if this were 

 true in the fullest sense, it would furnish no just 

 ground of objection for the most thorough advo- 

 cate for metallic currency. For the change 

 would be from a paper currency of unknown, un- 

 limited, and unlimitable quantity— not the repre- 

 sentative of specie, and impossible to be redeemed 

 in specie —to a paper currency, necessarily limited 

 narrowly by force of circumstances, (if indeed 

 entering into circulation,) of certificates of de- 

 posite, of which each one is the evidence not 

 only of a sound and fully and quickly responsible 



debt£)r to pay it, but also evidence of as much 

 real money being in existence, in the bank or else- 

 where. If all the coin of a fully supplied coun- 

 try were thus deposited and retained in banks, 

 and certificates of the deposites were issued, 

 and used exclusively for the circulation of the 

 whole country, these certificates could, in the 

 first instance, only amount to as much as the coin 

 actually in deposite ; and each paper obligation for 

 a dollar would have a specie dollar in existence, 

 and ready to redeem it. But if deposites of coin 

 thus made, instead of being retained in a mere 

 bank of deposite. were all used in discounting 

 business notes at short time, as is done hv savings' 

 banks, (or banks uniting th" op 'rations of discount 

 and deposite, and not of circulation,) and further, 

 if all the interest-bearing certificates of these de- 

 posites were used as money, and entered as such 

 into general circulation, then, it is true, there 

 would be a creation of additional currency, and 

 so far an evil in one aspect. But, at the utmost, 

 there could be only a doubling of the amount, by 

 issuing an equal sum in paper of so much of the 

 former specie currency, as there were certificates 

 of deposite for that entered into actual circulation, 

 and became part of the general currency ; and 

 this could not extend far, as is manifest, because 

 such interest-bearing certificates, though very 

 convenient for particular payments and settle- 

 ments, would not be convenient for, nor often 

 used as currency ; but would be held as other 

 scrip, or certificates of stocks, yielding regular 

 profits, '['herefore, it may be safely inferred, that 

 the slight and transitory applications of interest- 

 bearing certificates of deposite to the purposes of 

 money, although (as in all other cases of paper 

 money) so far substituting and causing the ex- 

 portation of some amount of specie, would not 

 do so extensively; and that this injurious opera- 

 tioii would be more than counterbalanced bv the 

 great public convenience of so perfectly safe and 

 responsible a paper currency, or evidences of 

 debt convertible at all times to money, as these 

 certificates would furnish. Indeed, no paper evi- 

 dences of debt could possibly be more safe, con- 

 venient and nrofitable, and certainly convertible 

 to specie, upon the stated rules and engagements 

 of the bank, provided the law rigidly enforced the 

 perfect accountability of the bank at all times, 

 and uiider all circumstances. 



If, then, banks merely of deposite and discount 

 were only to be allowed by law, and the danger- 

 ous privilege of creating and issuing paper money, 

 (in notes exempted from hearing interest,) were 

 altogether withheld from them, the safe and be- 

 neficial operations of banking might be carried to 

 any extent that the trade of the country required, 

 W'ithout legal restriction or limitation of action, 

 and with entire safety to creditors of the banks, 

 to the banks themselves, to the currency, and to 

 the public interests. And the certificates of de- 

 posites, bearing such uniform interest (say 5 per 

 cent.' as the rule of the bank fixed, with the 

 sanction of law, would serve excellently well for 

 temporary investments of spare funds ; and also 

 as partial and convenient substitutes for money, 

 and so far forming a part of the currency, for re- 

 mittances, or other payments. But, while serving 

 so Avell and so conveniently for payer and receiver 

 in transactions for which paper currency is bet- 

 ter than metallic, this kind of paper never could 



