MUTUAL BANKING. 



abandon all claims to novelty or originality as regards our own 

 scheme for a Mutual Bank. We think it very probable that our 

 theory dates back to "the project published in London in the year 

 1684:" but we affirm nothing positively on this head, since we are 

 altogether ignorant of the details, not only of the provincial project, 

 but also of the original London plan. We have no information in 

 regard to these matters, except that which is now submitted to the 

 reader. 



Our author says, on a subsequent page: 



"In 1739, a great part of the Province was disposed to favor 

 what was called the land bank or manufactory scheme; which was 

 begun, or rather revived, in this year, and produced such great and 

 lasting mischiefs, th.at a particular relation of the rise, progress 

 and overthrow of it may be of use to discourage any attempts of the 

 like nature in future ages."— ("History of Massachusetts," vol. ii., 

 352). 



It appears that after an interval of twenty-five years, the land- 

 bank scheme rose once again above the surface of the political and 

 financial waters. Governor Hutchinson says that this scheme pro- 

 duced "great and lasting mischiefs." Let us see what these "mis- 

 chiefs" were: 



"The project of the bank of 1714 was revived. The projector of 

 that bank now put himself at the head of seven or eight hundred 

 persons, some few of rank and good estate, but generally of low 

 condition among the plebeians, and of small estate, and many of 

 them perhaps insolvent. This notable company were to give credit 

 to £1.50,000 lawful money, to be issued in bills; each person to mort- 

 gage a real estate in proportion to the sums he subscribed and took 

 out, or to give bond with two sureties: but personal security was 

 not to be taken for more than £100 from any one person. Ten direc- 

 tors and a treasurer were to be chosen by the company. Every 

 subscriber or partner was to pay 3 p(>r cent interest [per annum] 

 for the sum taken out, and .'5 per cent of the principal;* and he that 

 did not pay bills might pay the produce and manufacture of the 

 Province at such rates as the directors from time to time should 

 set: and they [the billsj should commonly pass in lawful money. 

 The pretence was, that, by thus furnishing a medium and instru- 

 ment of trade, not only the inhabitants in general would be better 

 able to procure the Province bills of credit for their taxes, but 

 trade, foreign and inland, would revive and flourish. The fate of 

 the project was thought to depend on the opinion which the (len- 

 eral Court should form of it. It was necessary, therefore, to have a 

 house of representatives well disposed. Besides the 800 persons 

 subscribers, the needy part of the Province in general favored the 

 scheme. One of their votes will go as far in elections as one of the 

 most opulent. The former are most numerous; and it appeared 



•Thus the whole principal would be paid up in twenty years. 



