The Journal of Banking
by William M. Gouge,


Vol. I., No. 20,
Philadelphia,
Wednesday, March 30, 1842.


Banking History.

We continue in the present number, pages 313-320, the history of the great revulsion occasioned by the operations of the banks in general, and of the United States Bank in particular, in the years 1819-21.  Our sufferings in these present times are, as yet, hardly to be compared with what was endured in those days.  But what we are yet to suffer, remains to be seen.

When paper money banks are in what is commonly regarded as an orderly condition, that is, paying specie, as they are at present in Great Britain and New England, they produce evils which never yet have been adequately described.  When they are in a state of suspension, they produce other evils, which we need not attempt to depict, as every man south of New York, feels them in his business.  But the evils which they produce when regularly paying specie, or when in a regular state of suspension, are as nothing when compared with the calamities they cause by efforts at resuming and sustaining specie payments, especially if those efforts are ill timed and ill directed.  Some of these disastrous effects may not be felt immediately, but they will come to a certainty.  And then perhaps the people will see, that the welfare of the public would have been promoted, by gradually winding up the banks, instead of endeavoring to rebuild the old system of fraud and iniquity.


The Revulsion.

How far the present revulsion is to proceed, and how long it is to continue, no man can tell.  The revulsion which began in 1818-19, cannot be said to have been over, as regards all parts of the country, sooner than 1828.  But that was a revulsion which succeeded an inflation of the paper bubble in blowing up which the capital and credit of the people of the United States only had been employed.  In producing that inflation, which reached its height in 1836, the capital and credit of all Europe as well as of America, were brought into play.

As action and reaction are equal in morals as in physics, we ought to expect the present revulsion to exceed the former in the same proportion that the expansion of 1836 surpassed that of 1818.  Happily for us, Europeans are to share the losses with us.  They own large amounts of our bank stocks, our State stocks, and our internal improvement stocks.  In the former revulsion, the only losses they sustained, were through non-payment of commercial debts.

Happily for us, also, the country is now much more able to bear a revulsion than it was in 1818-19.  That came upon us only three years after we had come out of an exhausting war.  This comes on us after we have been for twenty or thirty years in the enjoyment of peace.  Yet diseases seem sometimes to be violent in proportion to the strength of the subject they attack.  The writhings of a giant when in convulsions are frightful.

Thus far the revulsion has, at least in Philadelphia and its neighborhood, taken a different direction from what it did in 1818-19.  Then it was felt most severely by holders of real estate.  Now it is felt most severely by holders of stocks.

When the former revulsion was at its height, the credit of the United States Government was so good, that its six per cents. readily brought 104 in the market.  Already is the credit of the United States Government reduced so low, that its six per cent.  Treasury notes (securities which are more easily negotiable than stocks) are below par.

Then the credit of the State Governments was good.  Now all the State Governments to the south and west of New York, four or five only excepted, are bankrupt.

The present revulsion will probably be felt most severely in the disorders it will produce in the financial affairs of the States and the General Government, and through them in the affairs of the people generally.  It will be well if we escape from our present difficulties, without entailing on the rising generation the curse of a paper money issued by the authorities of the different States, or perhaps by those of the United States.


The Times.

William H. Crawford, who was Secretary of the Treasury during the period in which the effects of the former bank revulsion were most sensibly felt, in one of his reports to Congress, described many parts of the country as having not only an unsound circulating medium, but not a sufficiency even of that.  As like causes produce like effects, they who have studied the history and principles of paper money banking, will experience no surprise on learning that such is now the condition of some parts of the Union.  A respectable farmer in Illinois, writes to us that he has not seen five dollars of any kind of money in the last three months.  The Frankfort Yeoman speaks of money as being scarcer in many parts of Kentucky than it had been for very many years.  And Mr. Piper, a member of the Virginia House of Delegates, gives the following statement of the condition of affairs in that ancient Commonwealth.

"The pecuniary embarrassment that now pervades every portion of the Commonwealth, threatening ruin and disaster to all classes of society, is a fact as notorious as it is deplored.  But however greater or however grievous this calamity may be in other sections of the Commonwealth, from various and peculiar circumstances it presses with accumulated violence and intensity on the south-western portion of Virginia.  The intelligence received from every part of that country by every mail that reaches this city, discloses a scene of suffering, of anguish, and distress, that can scarcely be imagined.

"From the total absence or entire destitution of a circulating medium of any kind, money has ceased to be the standard of value of any thing.  And instances are of constant and daily occurrence of valuable property being sold under execution for considerably less than what is sufficient to pay the officer's fees;  leaving the unfortunate debtor bereft of his property --perhaps his only horse or his only cow, by which he was able to procure a subsistence for his family;  and leaving the debt not only undiminished in any degree, but even greater than it was at first.  Nor is this state of things confined to any particular class of citizens, but with a few individual exceptions it extends itself to all classes of the community."

Let no man be surprised if this should be the condition of affairs in many parts of the country.  It is but the necessary consequence of revulsions in our banking system.

To supplant paper money gradually by specie, would be an easy task, if the proper measures were taken in the proper manner, and at the proper time.  But bank revulsions deprive the people of the currency to which they have been accustomed, and cause the specie which is in the country to be hoarded more closely than ever.  When every thing is falling in price, and every man is afraid to trust his neighbor, gold and silver come to be regarded as, if not the only profitable, the only safe investment.  The daily trade is then (forced sales excepted) reduced to what is necessary to supply daily consumption.  Many of those engaged in the preparation of fabrics to supply a future demand, are consequently deprived of employment;  and distress pervades every portion of the community.


"The Science of Currency."

In every man's notions of currency, there is more or less of truth, and probably in every woman's also.  And it is very well that it is so, as otherwise neither man nor woman could go through with his or her daily business.

Go to your fish women on Market street wharf, and offer to her a one dollar note of the Berks County Bank.  "Sir," she will tell you, "notes of that bank will not pass now."  Display to her then the contents of your pocket book, and let her have her choice of Indiana, or Illinois, or Alabama, or Georgia paper.  "Sir," she will say, "I know nothing about the notes of those distant banks.  Please to give me a city note."  You offer to her a Moyamensing note, or, peradventure, a Penn Township.  "Sir," she will tell you.  "those notes were very good a short time ago, but they are now below par.  Please to give me a note on one of the other city banks."

Go then to your broker on Third street.  His knowledge of currency exceeds your fish woman's.  He knows the price that Illinois, and Indiana, and Alabama, and Georgia notes bear in the market, and will give you current funds in exchange for them.

Next step into the warehouse of a merchant, not of a well read, reflecting, intelligent merchant, but one of that numerous class of traders whose mental vision is bounded by the four walls of their own counting houses.  He has to make a remittance to New York, and you will find that he has that knowledge of exchanges which will enable him to make the remittance at the least cost possible.

Then, enter one of our paper money banks, and converse with the cashier, and you will find that his knowledge of the rates of exchange, foreign and domestic, and of the easiest and cheapest way of making remittances, excels the merchant's exactly in proportion to the amount of transactions of this kind that be has daily or weekly to perform.

You wonder, perhaps, to find people of so little general intelligence, so very knowing on this particular subject.  You ought not to wonder at it.  They could not carry on their business without it.  Bills of exchange are commodities, and it requires no more intellect to deal in them, than in cotton or in sugar.  Perhaps it requires less.

Enter into a closer conversation with these people, and you will probably find that though their notions of money as a mere circulating medium are as correct as may be, they have no notions whatever of money as a standard of value, and as a measure of value;  or, if they have any, they are as crude and as vague as possible.  Your fish woman will tell you, perhaps, that "gold and silver have no intrinsic value, inasmuch as they cannot be either eat or drunk."  Your merchant will tell you, "that there is not gold and silver enough in the world to serve the purposes of money," and your broker and your banker will unite in affirming this declaration.

You wonder, perhaps, that people who know so much about money in one of its functions, should be so very ignorant of it in other respects.  But you ought not to wonder at it.  Your grocer weighs out your coffee and your sugar to you with great accuracy: but does he know any thing of the deep philosophy that is connected with weights and measures ?  If you should tell him that any given mass of matter, whether of coffee or sugar, or gold or iron, sustains an alteration in weight, every time it is carried a certain distance above or below the level of the sea, he will probably listen to you with doubt, or, if he takes you at your word, he will thank his stars that so much science is not requisite for weighing out coffee and sugar.

It is so with the broker, the banker, and the mere merchant.  Their special concern with money is as a circulating medium, and not as a standard or measure of value.  And as success in business depends much less on acquaintance with scientific principles, than on an accurate knowledge of details, it is to the acquisition of this latter knowledge that they devote all their attention.  And so successful are they in acquiring this knowledge of details, that the ablest writers on money that ever lived, Sir Isaac Newton, John Locke, Adam Smith, or Jean Baptiste Say, would, if brought into competition with the least intelligent of our brokers and bankers, prove very unequal to them in the noble art of "turning a penny."

The mischief of it is, that those people whose business compels them to acquire a knowledge of practical details, because they know something about money, suppose they know every thing.  They are ignorant of the fact that there is A SCIENCE OF CURRENCY, or a regular system of truths relating to money and its substitutes, and that this science, in order that it may be acquired, must be studied diligently as other sciences are.  With their knowledge of details, which in its kind is admirable, they connect some of the vaguest notions possible in regard to money in some of its most important functions, and every man who does not agree with them in opinion, is, in their view, a mere theorist.

We beg not to be misunderstood.  There are many merchants, many brokers, and many bankers, who have a competent knowledge of The Science of Currency.  But they have acquired a knowledge of this science, as they have acquired a knowledge of other sciences, by study.  They did not get it by intuition.  Neither did they get it by practical attention to the details of their business.  In bringing this science to its present state of perfection, many of the finest minds in the world have been employed, and the experience of many countries and many ages has been brought into requisition.  To see the whole extent of truths which have thus been brought together, and, what is of great importance, to see them in their proper connection, is impossible without a study of the writings in which they are to be found.


The Bank of Hamburgh.

The Bank of Hamburgh, Germany, is merely a bank of deposit;  but is found to answer an exceedingly and extensively useful purpose in facilitating commercial transactions.  The money deposited with it, lies in its vaults.  The person who has a thousand marks standing to his credit on the books of the institution, knows that he actually has so much silver in its cellar, and that the figures under his name in the folio of the bank ledger, are actually represented by bullion, and that he can obtain the amount at a moment's notice.  While a bank thus constituted cannot, evidently, afford any interest to those having money deposited with it, it is plain that its deposits consist of only the unemployed capital of the city, and such amounts as are required for wholesale transactions, and transferred from the accounts of one merchant to those of another.  A certain sum is paid by those who have the privilege of keeping an account with the bank, and the amount of this is regulated by the number of folios that are required to be written in the books of the establishment during a twelve month.  The rate is understood to be a dollar for each folio.  A small amount is also charged for warehouse rent, on each sum deposited.  The bank derives an additional income from dealing in exchanges.

The Bank of Hamburgh has been in existence for more than two hundred years;  and no doubts have ever been raised as to the fidelity of its management.  When the French captured Hamburgh, they plundered the Bank, but afterwards they restored to it its treasure.


The Bank of Amsterdam.

This Bank, like the Bank of Hamburgh, was merely an office of deposit and transfer, not a bank of issue and discount.  Of the amount of the treasure possessed by it, various conjectures have been made.

When the new Stadthuys was erected, the bank office was removed into a large vault in that magnificent structure; "where," says Sir Wm. Temple, in his Observations on the United Provinces, "is the greatest treasure, either real or imaginary, that is known any where in the world;  and whoever is carried to see this bank, shall never fail to find the appearance of a mighty, real treasure, in bars of gold and silver, plate, and infinite bags of metals, which are supposed to be gold and silver, and may be so for aught I know.  But the Burgomasters only having the inspection of the bank, it is impossible to make any calculation or guess what proportion the real treasure may hold to the credit of it."

Anderson, in his History of Commerce, in commenting on this passage, says, "it is generally taken for certain by all others who have written on this bank, that there is either cash, or bullion, or spare jewels, lodged in the vaults of the Stadthuys, equal to the amount of the whole credit of the bank."

A French author, referred to by Alldridge in his Universal Merchant, made the total of treasure possessed by the bank, 400 million guilders, which sum is swelled in the Amsterdam edition of the same work to 800 or 900 millions.  The first sum is equal to 180 million dollars, the second to 320 millions or 360 millions --an enormous amount of treasure, certainly, to be collected in one place.

Davenant seemed to be well assured, that the amount was at least 36 millions sterling;  and from 30 to 30 millions sterling, or from 145 to 174 millions of dollars, is the sum generally agreed upon by writers.

In our Inguiry into the Principles of the American Banking System, Chapter IV, we have said, speaking of the Bank of Amsterdam, "Millions of money which the merchants had deposited in its vaults, were lent by the Bank to the East India Company, and to the provinces of Holland and West Friesland.  The fact was long kept secret, but was discovered when the french entered Amsterdam in 1794."

In making this statement, we were governed by the common historical authorities.  But it is proper to state what we have lately learned from a highly respectable merchant, whose business has occasionally called him to Holland.  He got the confidence of the burgomasters, and they, in referring to these historical statements, mentioned that it would not be politic openly to contradict them, but denied that they were true.  They affirmed that on the approach of the French, the money was secretly removed from the Bank, and such entries made in the books as to induce their invaders to believe, that it had been surreptitiously loaned.  They laughed at the success of their stratagem.

The gentleman from whom we have this statement, firmly believes it to be true.  And Alldridge, in an edition of hit Universal Merchant, published in 1797, adduces a good many arguments to show that the Bank of Amsterdam was always faithfully conducted.  Some of his remarks we give below.

"The transactions of this bank are said to be confined within the real amount of treasure which it possesses, or, in other words, that for all the credit which is given in the books, it retains a correspondent value in bullion or coin.  But on this point there has always existed a diversity of opinions and conjectures, and though not ascertainable but by those who are in the immediate management, yet it is almost universally believed by those persons who have the greatest interest in the credit of the bank, and the best opportunity to scrutinize.  This belief is also confirmed by some corroborative circumstances which I shall here mention.

"In every political revolution, the promoters always endeavor to stigmatize their predecessors with corrupt or unfaithful practices: but this charge does not appear to have been ever exhibited against the persons in the management of the bank, in any of the convulsions to which the city of Amsterdam has been exposed.

"When the French army was at Utrecht in the year 1672, and threatened the reduction of Amsterdam, the bank continued to pay every demand that was made upon it with promptitude.  Many of the pieces of coin which were then brought out of the treasury, bore the evident marks of injury by the fire which happened in the town house soon after its erection.

"These facts confirmed the public in the opinion which they had previously entertained, of fidelity in the successive directors of the bank.  These directors are the four reigning burgomasters for the time being, who are changed every year;  each successive set receiving the treasure from their predecessors, after a strict comparison of its real value with the correspondent value of it in the books.  As this form is conducted with all that solemnity which a sacred oath, a regard to character, and the general importance of the transaction demands, I think we may safely conclude that the public opinion is well founded."

In another passage, Alldridge says, "whenever a deposit is withdrawn, it is always delivered in the bag in which it was originally deposited."  A practice like this, was admirably adapted for insuring fidelity in the management of the trust.


Obituary.

Within the last year we have, in Philadelphia, lost, by death, three of the best of our Political Economists.

The first of these in the order of mortality, was James Ronaldson.  He departed this life on the 29th of March, 1841, aged 72 years.  From the year 1792 or 1793, he was active in his opposition to the paper money system, endeavoring, by conversation, by occasional publications in the newspapers, and by small pamphlets published at his own expense and gratuitously distributed, to inculcate the true doctrines of money and of credit.

The next was Philip H. Nicklin.  He died March 2d, 1842, aged 56 years.  He was the first to give the American public an edition of Say's Political Economy.  He was also the publisher of Vethake's Political Economy.  And in various ways, by his pen and his purse, he contributed to the diffusion of the principles of a science which he justly regarded as the most important of the secular branches of knowledge.

The third was Condy Raguet.  He died March 20th, 1842, aged 58 years.  As a writer on currency, banking, and other branches of Political Economy, he has been known to the public for nearly thirty years.  Some passages of a report which he made to the Senate of Pennsylvania in 1820, will be found in our present number, commencing on page 313.  Other extracts from the same report, will be found in No. 16, pages 253-5;  and in No. 17, page 266; and in No. 18, page 286. On page 252, in No. 18, will be found an extract from another report he made to the same body in 1821.

---[Condy Raguet and William Gouge were the originators of the Independent Treasury concept.]

Of late years he has been the most zealous and the most industrious of all the Political Economists of the United States.  No less than four journals were established by him with a view of diffusing a knowledge of this science, namely, The Examiner and Journal of Political Economy, The Free Trade Advocate, The Banner of the Constitution, and The Financial Register.  As Editor of the Philadelphia Gazette, which post he occupied for some time, he opposed the schemes of folly which are now involving our State in ruin and disgrace.  He also published a valuable treatise on Banking and Currency, and a volume of Essays on Free Trade.

As the opponents of the present banking system are not unfrequently denounced as a "detestable set of loco-focos, agrarians, levellers, destructives, infidels and atheists," it may not be amiss to give some further account of the three gentlemen whose deaths are above recorded.

With Mr. Ronaldson and Mr. Raguet our intimacy was very close and of many years' duration.  Our intimacy with Mr. Nicklin was not of so long standing, but it was sufficient to enable us to appreciate the excellent qualities of his head and his heart.

The partiality of private friendship might be supposed to affect any testimony we might bear in their favor.  We shall, therefore, refer to the citizens of Philadelphia generally: and we believe they will, without distinction of party or opinion, units in declaring that these three gentlemen were among the most worthy of our citizens.

Mr. Ronaldson was a great friend to the useful arts, and spent much time and much money in endeavoring to bring them to perfection among us.  With this object in view, he paid several visits to Europe.  He was the first to introduce into the United States the important art of type founding;  and to several other useful arts, he gave so much encouragement at their commencement, as contributed in no small degree to their successful establishment.  He did not confine his attention to the different branches of mechanics and manufactures, but labored much also for the improvement of agriculture by introducing various new species of plants into the country.  By his industry, intelligence and economy, he acquired an ample estate.  By his will, after making suitable provision for his relatives, he distributed as much perhaps as fifty thousand dollars, in legacies of from 500 to 4000 dollars, among widows and others in the circle of his friends.  But he acted true to his principles, in leaving nothing to corporations, ecclesiastical, scientific, or charitable;  except a small legacy to the Franklin Institute, of which he was one of the founders: and another to the Philadelphia Cemetery Company which owed its establishment to his exertions.  He had seen too much of the abuses of corporate trusts to be willing to place confidence in any of them: and all he left to the Franklin Institute was the amount of a bond for 500 dollars due by it to him;  and to the Cemetery Company certain lots in their burying ground.  Peculiar circumstances induced him to make these trifling exceptions in favor of these two associations.

Though Mr. Ronaldson, in the practice of the Christian duties, excelled many who are very loud in their religious professions, he was not formally connected with any ecclesiastical body.  But Mr. Nicklin and Mr. Raguet were among the lending laymen in their respective churches: Mr. Nicklin in the Protestant Episcopal Church, and Mr. Raguet in the New Jerusalem Church.

Mr. Nicklin was a member of the Missionary Board, a trustee of the General Theological Seminary, a delegate to the General Convention of the Church, and a member of the Standing Committee (or Bishop's Council, as it is popularly called) of the diocese of Pennsylvania.  The Banner of the Cross, and the Episcopal Recorder, both published in this city, bear the highest possible testimony in favor of his talents, his piety, and his usefulness.  His pastor, the Rev. Dr. Dorr, minister of Christ Church, and Rev. Dr. Doane, the Bishop of New Jersey, concur in declaring that he was, on theological subjects, the best read layman they ever were acquainted with.  This, however, is but feint praise, compared with what these gentlemen say of Mr. Nicklin's moral character.

Mr. Raguet was one of the gentlemen who was most active in organizing the New Jerusalem Church, in the United States.  He was a member of their first General Convention, which was held in this city in the year 1817, and we believe he was the originator of the call for that convention.  Of many subsequent Conventions he was a member, and in various ways he labored for the diffusion of the doctrines of a Church, of the truth of which he was most firmly convinced.  He died in great peace, and left a particular request that if his friends took any notice of his life or of his death, they would declare, as from him, that whatever ability he had had to discharge his duties to society, and that whatever there was worthy of approval in his conduct and character, he owed to his belief in the Christian religion, as set forth in the writings of Emanuel Swedenborg.

To those who know nothing of the writings of Baron Swedenborg except from common report, it may seem strange that so close a reasoner as Mr. Raguet was on all questions of Political Economy, should have embraced a system which they have been led to believe is nothing but a collection of the wildest vagaries of the imagination.  If he erred here, he erred in company with many other men of good general intelligence.  In proportion to their numbers, the New Jerusalem society in Europe and America, embraces more literary and scientific men than are to be found in any other religious communion.  Connected with "the visions" in Swedenborg's writings, there is a very deep system of religious philosophy, taking in whole circle of moral, intellectual, and physical nature.  Whether the system is false or true, is to be judged of after careful and candid examination, and not from common report.  We are not to be understood as expressing any opinion of its truth or falsity.

Mr. Raguet was originally a merchant.  By the revulsion of 1818-19, he was suddenly reduced from affluence to poverty.  It was his own experience in part that opened his eyes to the true nature of our paper money system.  He started in life with the opinion so common among merchants, "that our banking system is all right in principle, and that the evils it produces are all owing to errors in its management."  We need not say to what extent inquiry and observation compelled him to modify this opinion.  His own writings show it.

After the expiration of his term of service as a Senator of Pennsylvania, Mr. Raguet was appointed Consul at Rio Janeiro, and subsequently Chargé d'Affaires at the Court of Brazil.  His situation here during the latter part of the time, was a very trying one.  The Brazilians searched for vessels, captured our ships, impressed our seamen, and imprisoned our citizens.  They perpetrated against us nearly all the offences for which we, in 1812, went to war with Great Britain.  In vain did Mr. Raguet protest against these outrages.  The government at home (Mr. Adams being then President, and Mr. Clay Secretary of State) did not send a single ship of war to that station, nor did he receive from them a single line of instructions.  Under these circumstances, no course was left to him, but to transfer the seat of negotiations to Washington.  He accordingly embarked for the United States, and the Brazilian Authorities, seeing from this bold movement that they would no longer be permitted to trample with impunity on American rights, immediately despatched Mr. Rebello after him to make the proper concessions to the United States Government.

The usage of all Governments is, when a diplomatic agent is compelled in the discharge of his duty to leave his post, to give him another of at least equal dignity.  This act of justice the Administration then in power neglected to perform to Mr. Raguet: and we regret to add, that the Administration which succeeded it, failed to remedy the wrong he had sustained.

From the time of his return from Brazil, Mr. Raguet was chiefly employed in editing various journals of Political Economy, till within a few years of his death, when he was appointed President of the Atlantic Insurance Company of this city.  It was a point of conscience with him, to make the discharge of the duties of any station to which he was appointed, his object of primary concern.  From this time, consequently, the duties of his office, and those of President of the Chamber of Commerce, and other honorary posts which he filled, occupied most of his attention.  But he did not abandon his favorite studies. --Much of his leisure out of office hours was employed in writing essays for the public papers intended to elucidate various questions of Political Economy.  He never meddled with personal politics !

To some, an obituary notice may at first seem out of place in such a periodical as the Journal of Banking.  But when they reflect on the deep interest Messrs. Ronaldson, Nicklin and Raguet, took in the question, and the length of time they labored for the advancement of such objects as we have in view, they will see that our Journal would be incomplete without some notice of their lives and labors.

The friends of sound currency and sound credit have, moreover, borne too long in silence the reproach of being "a miserable set of loco-focos, disorganizers, radicals, levellers, destructives, agrarians, infidels, and atheists."  We must, at least when our leading men die, be permitted to vindicate their memory from such aspersions.

If our limits would allow us to give at length the various testimonials respecting James Ronaldson, Philip H. Nicklin, and Condy Raguet, that have appeared in different political, religious, and scientific periodicals, they would be found fully to sustain all that we have said of their excellence of conduct and of character.


Bank Failures.

In this number we have to record the failure in Philadelphia of the Penn Township Bank, the Mechanics, the Manufacturers & Mechanics, and the Moyamensing.  In the interior of Pennsylvania, of the West Branch Bank at Williamsport, the Berks County Bank at Reading, and the Northampton Bank at Allentown.

At New Orleans, of the Merchants, the Improvement, the Atchafalaya, the Orleans, and the Exchange Bank.

In Illinois, of the State Bank of Illinois at Springfield, and of its numerous branches in different parts of the State.

And in New York of the Clinton County Bank.


Bank Defaults.

Mr. Simon (O'Callaghan, paying teller of the Atchafalaya Bank at New Orleans, has proved to be a defaulter to a large amount, --according to report from one hundred and fifty to two hundred thousand dollars.

He has gone off, it is said, with Mr. Edward Yorke, late president of the Exchange Bank, and purchaser of the Merchants' Bank, who is said also to be a defaulter to a large amount.

Mr. Thomas L. Budd, clerk of a bank at Nashville, Tennessee, has been convicted of embezzling its funds, and making false entries in its books, and sentenced to five years imprisonment.

From the statements in the western papers, there seems to be no longer any doubt that Mr. William McK. Ball, late cashier of a branch of the Real Estate Bank of Arkansas, is a defaulter.  He threatened, as our readers may recollect, to visit with signal punishment those who had brought this charge against him;  but it appears that he has made his final escape to Texas.

Mr. Hosea Levis, former cashier of the Schuylkill Bank of this city, has left Texas, and is now on his way to Louisville, to give testimony in a case which is intended to decide the question whether the Schuylkill Bank or the Northern Bank of Kentucky is to be responsible to those who purchased certificates of the stock of the Northern Bank of Kentucky, fraudulently issued in this city.  It is thought the testimony of Mr. L. will be very interesting, and that it will throw on others part of the censure which he has hitherto had to bear alone.


Pennsylvania.

Delegates from about sixteen of the country "relief banks" met at Lancaster about two weeks since, and passed resolutions declaring that they were, by the provisions of "the relief act," exempted from the operations of the "resumption law."  They agreed, however, to pay out silver for the purposes of small change, and some of them have since effected at least a nominal resumption on all demands payable at sight.

Country relief notes, which are bought by our city brokers at 20 and 25 per cent. discount, are said to be paid out by the State Treasurer at par;  and the public creditors are forced to take them or take nothing.

A correspondent of one of the papers, affirms that the movement for immediate resumption has operated in a manner very different from what was intended by some of those who were apparently most desirous of a return to specie payments.  He says, the object they really had in view was to coerce the banks that did not accept the law, into the issue of a new batch of "relief notes;"  and he declares that the floating debt of the State amounts to six million dollars !  Surely there is some mistake here.  The committee of the House of Representatives reported a bill for the issue of only 1,800,000 dollars of circulating script.

Bills to impose additional taxes have been reported, and are talked about, but are not passed into laws.  As a former tax bill, which was, according to calculation, to have yielded by a certain period 500,000 dollars, produced but thirty thousand, it is evidently much easier to legislate about revenue than to collect it in Pennsylvania.  And as the most the State will receive for tolls and taxes will be in its own depreciated bills of credit, it will be destitute of available means for paying to foreign creditors the interest on the funded debt due in August next.

Under these circumstances it is not surprising that the stock of the State should be daily falling in value, and that some cases have occurred of five per cents. being sold at 35 for 100 paid.  As the claims of the contractors and laborers on the public works were, in February last, postponed to make room for the claims of the holders of stocks, why should not the claims of the holders of stocks be postponed in August next, to make room for the claims of the contractors and laborers ?  Yet the holders of State stocks ought not to sacrifice them.  The State's rail-roads and canals will ultimately be transferred to them, and these, though they hardly pay expenses when under the management of officers of Government, may become productive when under the control of a company.

Petitions have been sent to the Legislature from both the eastern and western parts of the State, to pass an act "to prohibit brokers from shaving the relief notes!!"  This, our readers will say, shows little knowledge of the nature of circulating credit.  What will they say when we tell them that a bill intended to coerce a circulation of relief notes at par, was not long since introduced into our House of Representatives, and actually received the votes of 37 members of that honorable body !


Philadelphia.

We mentioned in our last, that on Monday, March 14th, our banks should have resumed specie payments, according to "Act of Assembly."  But they did not resume on Monday, nor on Tuesday, nor on Wednesday, nor on Thursday.

Nor did some of them so much as attempt to resume, for they found they could not stand "the runs" that were made upon them, not for specie, but to exchange one bit of paper for another.  The Penn Township broke, and then the Mechanics, the Manufacturers, and the Moyamensing.  They had, in the aggregate, a capital of 2,500,000 dollars.  Add this to the capital of the United States Bank, the Girard, the Pennsylvania, and the Schuylkill, and it makes a total of $46,250,000.  In old times, banks used to break in Boston, in New York, and in Baltimore;  but no instance occurred of a bank failure in Philadelphia till Mr. Levis, by his superior financiering, caused the Schuylkill Bank to stop payment.

The Banks which now remain are the Philadelphia, the Commercial, the Farmers and Mechanics, the North American, the Northern Liberties, the Southwark, the Western, the Kensington, and the Germantown, having in the aggregate a nominal capital of about seven million dollars, but a real capital of only one-third or one-fourth of that amount if the price their stock bears in the market is any test of its value.

These nine banks resumed specie payments on the 18th and 19th of March, and their conduct has been imitated by all the banks in the State of Delaware, (five in number, or nine if their branches be included,) by six banks, it is said, in West Jersey, and by about fifteen in the interior of Pennsylvania.

It is almost unnecessary, we presume, to say that we look upon such a resumption as this, as one of the effects of the paper money disease.  Had a different method been adopted, hundreds of thousands of dollars might have been saved for the noteholders, hundreds of thousands for depositors, and hundreds of thousands for those widows, orphans, and others, who have invested their little all in bank stock.  But, as was observed in our last number, no instance is on record of a paper money system being reformed.  In all countries into which it has been introduced, the enormity has gone on increasing till it has exploded.  And this resumption may only hasten a general explosion, which, according to the signs of the times, is not far distant.


Bank of the United States.

The case of Nicholas Biddle, Joseph Cowperthwaite, and John Andrews, accused of a conspiracy to defraud the stockholders of the Bank of the United States, was brought before a Judge of the Court of Common Pleas, on a writ of habeas corpus.  After a full hearing, the Judge refused to discharge them, chiefly, as it would appear, on technical grounds.  They then had their case brought by writ of habeas corpus before the Judges of the Court of General Sessions, who have not, as yet, given their decision.