Studies in American History 
53 
thirds, and a trip down the Ohio to New Orleans had been 
reduced from thirty or forty days to six or sevenJ 
Kentucky’s total population in 1810 was 406,511. By 1820 
she had 564,644, which gave her sixth rank in the Union. 
Of this population, 434,644 persons were white, 2,759 free 
colored, and 126,732 slaves (an increase of more than 57 per 
cent in the number of slaves since 1810) More than 500,000 
persons lived on farms or in village settlements. Even at 
this early time, a sort of landed aristocracy was developing 
in the Blue Grass section and in the older parts of the state. 
Many farmers had plenty of slaves, their farms were well 
cultivated, often they had coaches that were built at Lexing- 
ton at a cost of $1,000 or more, and they led an easy pioneer 
life. Farm products prior to the panic in 1819 brought un- 
heard-of-prices. Common wool sold at 50 cents a pound, hemp 
was $80 a ton, and flax $15 a hundred pounds. Kentuckians 
had a widespread mania, often to the disadvantage of home 
manufacturers, for wearing the best English-made clothes. 
Lexington, with a population of 5,271, was then the largest 
city in Kentucky. Town lots there sold in speculative times 
at prices nearly as high as those in the large cities of the 
East. Even in Louisville, a smaller town, lots sold for as 
much as $30,000 an acre during this time of speculation.® 
Stocks and bonds were unknown, and speculation was chiefly 
in real estate. Recorded deeds show that lots in the small 
villages of Shepherdsville, near Louisville, and Carrollton sold 
on time payments at New York and Philadelphia prices. Un- 
fortunately, the most active speculators were men of small 
means, and they traded almost wholly on a credit basis. 
The people of Kentucky, being far removed from eastern 
cities, understood little of complex financial problems, and 
at times when speculation abated and hard times appeared 
near they clamored for more banks and more circulating 
medium. These measures seemed easy enough to accomplish, 
since only corporate seals and paper mills were necessary 
then to start banks. 
The first banking institution in Kentucky was incorporated 
^Robert M. McElroy, Kentucky in the Nation’s Histcyry (New York, 1909), 377, 378. 
® Lewis Collins, History of Kentucky (2 vols., Covington, 1878), I, 29. 
® William E. Connelley and E. Merle Coulter (Judge Charles Kerr, ed,). History of 
Kentucky (5 vols., Chicago and New York, 1922), II, 593, 594. 
^'^John Mason Brown, “The Old and New Court” (a paper read before the Ken- 
tucky Bar Association, June 22, 1882), Durrett MSS., 20. 
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