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INDIANA UNIVERSITY STUDIES 



western bankers at Cincinnati, it was decided to begin specie payments 

 again, April 20, 1817. Already at a meeting of the directors of the 

 Vincennes Bank February 20, 1817, it had been decided to pay 

 gold and silver for all their own notes presented." President Ewing 

 notified Secretary Crawford of this action on April 3."^ 



Accordingly on the 7th of May Secretary Crawford directed 

 the receiver to deposit the pubhc funds in the Bank if it agreed 

 to the conditions. These conditions were: a guaranteed deposit 

 of $75,000 and notice of treasury drafts; a monthly statement of 

 the public account; a monthly bank statement, together with a 

 list of the Bank's debtors; and the acceptance as cash of all money 

 received at the land office — the receiver of the land office to accept 

 only such money as was directed by the Bank, The Bank promptly 

 accepted the conditions, which were fair, and cashier Blackford, 

 soon to become a distinguished judge, wrote on the 19th of June: 

 ''We are now engaged in receiving the deposits from the receiver on 

 account of the sale of public lands, which will be completed in a 

 few days." 



The directors of the Bank of the United States at a meeting 

 October 31, 1817, expressed their ''earnest desire" to Mr. Craw- 

 ford that he dispense with the services of all the state banks north- 

 west of the Ohio.^o The warning was followed up; early in Feb- 

 ruary, instructions were sent to the receiver at Vincennes from the 

 branch bank at Louisville to receive no western notes except thote 

 of the State Bank of Kentucky. Such a storm of protest, politi- 

 cal and commercial, followed this high-handed conduct of the Bank 

 of the United States that the order was soon modified. 



The new arrangement relieved the Bank of the United States 

 of the responsibihty for the depository banks. Money was de- 

 posited, as before, but to the credit of the Bank of the United 

 States for the use of the United States. The deposit bank was to 

 have the use of all money deposited for two months. If at any 



" Am. Sta. Pa., Fin., IV, 713. At this meeting there were present Nathaniel Ewing, President; 

 John D. Hay, Charles Smith, EUas McNamee, William Jones. Benjamin ' Parke, John Johnson, 

 Isaac Blackford was cashier. 



28 Jbid. 



29 A7n. Sta. Pa., Fin., IV, 525. 

 Am. Sta. Pa., Fin., IV, 821. 



" Hay to Senator Taylor, February 24, 1818: "If these instructions are to be permanent it will 

 cause great inconvenience, as it is impossible for settlers to got their monej. changed under 20 per 

 cent. Few entries are being made. People come here from the South and East and cannot get 

 their money changed and have to go back without purchasing." Am. Sta. Pa., Fin., V, C5. 



3" See Am. Sta. Pa., Fin., V, 65, 68; IV, 854, 874, 571, 588. Langdon Cheeves, who succeeded Jones 

 as president of the Bank of the United States, said the custom of receiving these bank notes as cash 

 nearly broke the bank. Some of them were worthless, or proved so, on others it took time to realize 

 and the bank lost the use of its money. 



