15422. Banks in New York (New York, NY)

Bank Information

Episode Type
Suspension → Reopening
Bank Type
state
Start Date
October 16, 1857
Location
New York, New York (40.714, -74.006)

Metadata

Model
gpt-5-mini
Short Digest
7294bbfd

Response Measures

None

Description

Multiple articles describe the widespread suspension of specie payments by banks in New York in October 1857 as part of the nationwide panic, and later accounts state banks resumed/specie payments by December 1857. This is a collective episode (many New York banks), not a single-bank run; cause is macro/systemic (panic following failures such as Ohio Life & Trust).

Events (2)
1. October 16, 1857 Suspension
Cause
Macro News
Cause Details
Part of the nationwide financial panic of 1857 (failures such as Ohio Life & Trust, heavy market contraction) that led New York banks collectively to suspend specie payments.
Newspaper Excerpt
The suspension of specie payments by the Banks generally ... all the Banks in that city have suspended.
Source
newspapers
2. December 1, 1857 Reopening
Newspaper Excerpt
the banks were enabled to resume in December. ... the panie continued about fifty days, until the middle of October, 1857, when all banks suspended ... When the banks suspended relief cause of course. Confidence gradually returned, money flowed into business channels, prices improved, and the banks were able to resume in December.
Source
newspapers

Newspaper Articles (9)
1. October 16, 1857 Evening Star Washington, DC
Article from Evening Star, October 16, 1857

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# THE BANK SUSPENSIONS IN BOSTON. The bank presidents, at their meeting on Wednesday afternoon, adopted the following preamble and resolutions: In considering the course taken by the banks this morning, in suspending specie payments, we are led to the conclusion that it was not a matter of mere expediency, growing out of the fact that the banks of New York, Philadelphia, Baltimore and other important cities had set them the example, but a measure of irresistible necessity—a necessity imposed on them not merely or principally on their own account, but most especially for the protection of their numerous debtors. It is obvious that the banks could not continue specie payments without calling on their debtors to pay in specie; and, although the great mass of them are in possession of a large property, their inability to pay in specie is certain, and an attempt to enforce it would end in ruin. In their fall, all the laboring classes of the community must be involved. They would be thrown out of-employment, and their families thrown out of daily bread. It is to avert these consequences that these measures have been adopted. The committee recommend, therefore, the adoption of the following resolutions: "Resolved, That the present system of daily settlement between the banks in the clearing-house shall be continued under such modifications as the clearing-house committee shall deem advisable. "Resolved, That there shall be a return to specie payment at as early a period as possible." The resolutions were unanimously adopted.

2. October 16, 1857 New Orleans Daily Crescent New Orleans, LA
Article from New Orleans Daily Crescent, October 16, 1857

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New Orleans Money Market. CRESCENT OFFICE, No. 70 Camp street, Thursday Evening, Oct. 15, 1857. The Infernal panic which was started yesterday in our mids without any just cause, without reason, without a shadow ( foundation, reached and attained its culminating point to-day Whatever the consequences may be, we have the sincere gratit cation of announcing that the following Banks stood the ru and promptly complied with every demand until the usual her of closing, say Citizens' Bank, the Canal Bank, the Bank Louisiana, the Louisiana State Bank, the Southern Bank, the Bank of James Robb. The NewOrleans Savings Institution, street, was dense crowded at an early hour. It met all obligations according contract, and by 12 o'clock there was not a person present. Th was cheering. The Mechanics' and Traders' Bank opened, as went on in its regular business, with the exception of redeemin its circulation. So did the Union. The Bank of New Orlea was enjoined at the suit of one of its Directors. This is singnir very singular, and shows a want of nerve and sagacity in management. We desire to hear no more of such finances. a Bank's own Directors have no faith in its management, th surely it is time to close. There has been entirely too mu haste in this movement. At a quarter past 2 o'clock yesterd the Bank closed its doors. A short time afterwards it was p tested at the request of one of its Directors on a note of five hu dred dollars. In the name of God, is this the kind of harmo that ought to prevail among twelve managers of a Bank WI is the public to understand from it? Fortunately for the go of our commercial community this spirit does not prevail amo the majority of our Bank Directors. If it did, we might 1 adien to the prosperity of our city. We learn that the Mechanics' and Traders' Bank and t Union Bank will go on as usual with their business. The Pro ident of the Union Bank is absent. If, however, some for R creditors will push matters to extremes, jeopardizing t interests of the whole, then on them be the consequence. T Banks in question will recover, if allowed to proceed. The e t culation of the two together does not reach $900,000, and t porte fewilles are considered good. To suppose that the occurrences of the past two days . et tend to destroy confidence in the future is not warranted. y X consider the crisis is now past ; that the worst has been realize n and although we may expect a tight money market for son days longer, yet the decided action of the New York Banks 1 evil or for good, has tended to relieve the general anxiety, a d the telegraphic advices, received to-day, if they are to credited, give us to understand that an improvement has alrea taken place in New York. All the Banks in that city have 1 suspended. We learn from Mobile that the Banks in that et have BO thought of suspending. This augurs well, but it wor of have been highly gratifying to us to have had it to state that re our own Banks had manfully stood up to the pressure. as There was also a run on the Bank of Commerce, of which t sa patriarchal Jacob Barker is chief manager. It met the r on fearlessly, and paid with the same promptitude as the Bank e Louisiana. There were no other important movements duri the day. er Of course there is not much to be said of the paper mark st There were some shaves, the greatest of which was a $50 Ba of Louisiana note ing sold to a broker on Canal street at $ 50. and a $5 note of the Southern Bank of Alabama being 80 for $3. We aliude to these merely to show what a pauie will i There was nothing done in exchange. The telegraph advis of sales of sterling in New York this morning at 105, but this on a reduced standard of currency or value. It will be some ti of W before we have any similar quotation to note in this mark CWe, however. confidently believe we shall get to work again two or three days, unless our moneyed institutions get into ad snarl among themselves, which we fervently hope they v avoid. erThe following is the memorial of the Banks of the city Philadelphia to the Legislature of At a meeting of the Board of Presidents of the Banks of city of Philadelphia, held on the 3d day of October, 1857, in following preamble and resolutions were unanimously adopt and directed to be forwarded to the Honorable the Senate a the House of Representatives of Pennsylvania. Whereas, The banks of this city, in consequence of the effe of the sudden and universal severity of the financial crisis wh has overtaken the country, have been reluctantly compelled suspend the payment of specie for the notes and obligatio 18notwithstanding every effort has been made by them to av such necessity and whereas, the mercautile, manufacturi as agricultural and all other classes of our citizens are greatly e 17 barrassed by the existing condition of things, towards whi under existing circumstances, it is not in the power of the bar Pto afford such relief as the exigencies of the community requi in consequence of heir laboring under the forfeitures and per les ties of the act of 1850 and other acts and, whereas, it is esdesire of the banks to resume the payment of specie at esearliest practical period, and to do what they can towards storing the currency to asound and healthy condition. and in a meantime assist the business portion of the community. wh all objects cannot be carried out unless the Legislative forfeitu and penalties are temporarily suspended. Therefore, Resolved, That in order to enable the banks of this city, H, of this Commonwealth, to resume the payment of specie at ion earliest practicable period, and in the meantime render such sistance as may be within the power of the banks to the mere iz: tile and business community, it is essential that the penalties ow forfeitures imposed by the act of 1850, and other acts be 1 porarily suspended. are Resolved. That in the event of the failure of the banks to tain from the Legislature relief from the forfeitures and per ties under which they at present labor, their remains no alter tive for them but that of going into liquidation, a measnre wh they are most desirous to avoid, on account of its disastrous LE fluence on the community and the banks. ess Signed by order of the Board of Presidents. J. B. MITCHELL, Chairma mp 1y JOHN JORDAN, JR., Secretary. Philadelphia, Oct. 3, 1857. C. Some days since it was reported that the banking house of 15 E. Culver, Louisville, had suspended payment. It appe however, before the suspension, the following guarantee made for the benefit of depositors. Y. The guaranty which we publish below confirms the er om confidence existing on the part of the depositors with our fell citizen, William E. Colver. We have heard of no apprehen of a run upon this bank but this guaranty, procured in a 8 time by a friend of Mr. Culver, makes assurance doubly sur RT LOUISVILLE, October 1, 185 ing We, the undersigned, agree to guaranty the depositor in William E. Culver, in the payment in full of their dema y against said Culver, on account of money deposited with hir We have entire confidence in his ability to meet all dema REAMES THOMPSON, AMES GUTHRIE,

3. October 21, 1857 Nashville Union and American Nashville, TN
Article from Nashville Union and American, October 21, 1857

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COMMUNICATED WHAT SHALL BE DONE? In the present deranged state of the currency, resulting from the suspension of specie payments by the Banks generally, and particularly in our own S ate, we often hear the question asked: What shall be done?" True financial policy consists in adopting our me isures to our means and to the circumstances with which we are surrounded. The suspension of the Banks in New York, Boston, Philadelphia, Charleston and New Orleans, left no alternative to the Bank of Tennessee, consistent with her duty to the people and the State, but to suspend also. No one doubts her ability to resume whenever the Banks at the large commercial ports shall return to specie payments. Then let the Legislature sanction the suspension for the present, but prohibit the Bank from charging more than half to one per cent. in the sale of exchange on any place in the United States. This would prevent exhorbitant rates being demanded for exchange, during the period of suspension and compel them to resume cash payments with the Banks of our sister States. The Bank should be required to pay specie on all its notes under five dollars, and, after resumption, to issue no note that is not payable at the place of issue. Extend the benefits of the act to all the Banks in the State, Stock as well as Free. Provided that no Bank shall be entitled to any of the provisions of the act, that does not pay to its depositors on demand in current funds, (such as are received by the Bank of Tennessre,) and make satisfactory arrangement with that Bank for the reception, and short periodical redemption of its notes. No difficulty, it is confidently believed, would be experienced by the solvent Stock and Free Banks, im making such arrangement. Of the Union and Planters' Banks it is useless to speak. Their circulation is small and they are in strong positions. In the daily exchanges they are usually the creditor Banks. The Banks of smaller capital might make the arrange ment by a deposit of State Bonds or other collaterals by the discount of a portion of their Bills of Exchange, of which it is said they all have plenty, or by the deposit of a portion of their coin. The ability of the suspended Banks would thus be tested. Uniformity in the currency of the State, in ordinary transactions, and with the Banks produced, & large amount of Bank notes now uncurrent would enter into immediate circulation. Confidence, to a great extent, would be restored, and pecuniary embarrassment alleviated. The Banks that failed to pay depositors, or make the required arrangement with the Bank of Tennessee, in - days (15 or 20 would be sufficient,) should be put into liquidation. No time should be fixed by the Legislature for resumption. Desirable as is that event, it must depend upon circumstances beyond the limits or control of the State, which no man now can foresee. The produce of the country must besent to market, and the indebtedness, to a considerable extent, not only in this, but in other States, paid off before that should be attempted, or can be safely accom plished. The provision in regard to the sale of exchange will compel them to pay specie when the Banks of the other States resume. The right to Legislate in regard to all the Banks, or to wind them up, should be expressly reserved to any subsequent Legislature. This would give time for discussion and reflection, and for 8 thorough reformation of the Banking sysA MERCHANT. tem of the country. TAINSON

4. October 29, 1857 Fayetteville Observer Fayetteville, TN
Article from Fayetteville Observer, October 29, 1857

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FAYETTEVILLE, TENN: Thursday Morning, October 29, 1857 The Financial Alarm. The present severe stringency in the money market in all the principal cities throughout the United States has led to a panic in some quarters which, in our deliberate opinion, is the most ungrounded alarm with which a people were ever visited. This stringency has been brought on by the failure of the Obio Life and Trust Company and the Banks and Brokers connected with it, which has precipitated the fall of a few houses, that were probably tottering before. The failures have generally been connected with the stock operations. The panic seized the banks, and in the city of New York alone they contracted their circulations a. bout $9,000,000 in less than one month in the midst of the fall trade. The very few failures that have occurred only demonstrate how solvent and sound are mercantile men and commercial affairs. Upon this condition of affairs, the Philadelphia Press pertinently and truthfully remarks: What do we find throughout the country to justify, then, the alarm which pervades the community at the present time! In all the South the people are rich and fully able to pay their debts. In the West, where speculation was said to be heaviest, failures are few and unimportant. The crops are abundant. The interests of agriculture are not embarrassed. The great staples, which form the basis of our foreign exchange, are abundant and high valued. We have a large basis of specie, which can only be shipped abroad under an easy money market, Our accumalations from California are rapid and timely. Then why have we such a panic! Is it wholly because men fear; because they dread a general crash! A general crash is impossible; because the general interests are not only healthy, but absolutely wealthy. Railroad stocks have fallen to that point where the universal conviction endorses them as first-rate investments, Commercial failures below this are SO many reliefs to the market; S0 that a8 we see public affairs, they can be no worse and must soon mend. But no have a panic, and a panic is a practical bankruptey of all interests. It creates and keeps alive the distrust of the neighbor; it withdraws capital from every pursuit; it forces a general depreciation of stocks, notes, bonds, and real estate; and, above all, it places bardworking business men at the mercy of a few moneylenders, who have the power to absorb the earnings of years in a few days, The credit and character of years are not lightly to be sacrificed. Honorable merchants will yield fortune without blinking to preservereputation. Conditions are nothingmoney must be obtained, and thus the business man is placed wholly in the power of the money man. This is the fruit of a panic-a :

5. October 31, 1857 New Orleans Daily Crescent New Orleans, LA
Article from New Orleans Daily Crescent, October 31, 1857

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New Orleans Daily Grescent. THE COMMERCIAL DEPARTMENT. New Orleans Money Market. Friday Evening, Oct. 30, 1857. CRESCENT OFFICE, No. 70 Camp street, } The movements to-day in both commercial and financial circles are hardly worthy of recording. Some few transactions in exchange were consummated, but the change in business for the week offers no new feature for remark. The private telegraphic dispatches do not encourage us to hope that large operations in exchange can be realized for the present. Many parties in New York are waiting to learn the effect in England of the suspension of the Banks in New York. The steamer to leave Liverpool, to-morrow, the 31st inst., (the Arabia) will bring the results. If the London discount houses shut down on American bills of exchange, it will not be unexpected. The present feeling, regarding sterling exchange, may be in part attributed to this expectation. The discount line of our Banks seems to be the great object for remarks at this moment. As we have before observed, all this community has to do is to restore the coin drawn from the Banks and relief will follow. We do not suppose that any one will deny that if the Citizens' Bank had not been ruthlessly assailed and depleted of its coin, but what it would at this time be discounting at the rate of half a million of dollars per week, and purchasing and selling exchange correspondingly. Out of the many millions of dollars invested by this Bank in exchange, not a dollar up to this time has been lost. If the public desire to know why the Banks at this time are 80 chary, and so very strict in exchange transactions, we can in part relieve the prevailing feeling. The sterling exchange purchased in September, based on cotton at much higher prices than now ruling, say at from 101@105 is in great jeopardy. To this may be added the great difficulty of selling exchange in New York. There are 80 many bills offering in that market, based on flour and grain, and the wants of importers of foreign merchandise, SO restricted that a very moderate amount of bills answer all purposes at this time. Our general paper market is a blank, a perfect blank. We are rapidly approaching that spoch when will be manifest how small an amount of money will answer for daily, social and commercial requirements. We do not learn of any sales or negotiations of paper whatever. In exchange there were sales of sight on New York at 5 per cent. discount, payable in currency, and 41/4@4/2, payable in gold. There were some sales of sterling at 92@94. Francs we quote at 6.10@6.50. As for sixty days sight on New York, we have not met an individual this week who has alluded to such a thing as a time bill on a suspended city. The telegraphic dispatches to-day brought some very queer accounts. One was quoting sterling at 106@107, without any affixture, and another the same figure, but with the affixture nominal. Then another dispatch says that the Persia brought out a large number of certificates of deposit, made by the Bank of England. Well, though a paper expedient, this may answer, and if such certificates have actually been received, they will be available-they will of course purchase cotton and breadstuffs. They are reported to be held at 7@8 per cent. premium. If they are forwarded here for investment, the question will be, can our factors use them as coin? though they will not command any such figures as asked. This is a paper currency we do not much approve. It pertains too much of the post note system of the Bank of the United States in 1838-'39. There has been 80 little done in stocks and bonds this week that we are forced to omit quotations. A sale of 30 shares Bank of Louisiana at 120, and a resale of Jackson Railroad Stock at an advance is all we learn. There is nothing doing in uncurrent money, nor in land warrants. Some few land warrants have been offered without meeting buyers. Everything relating to uncurrent money is nominal. The Mint is receiving all that offers for recoinage. There have been no further receipts of coin since Wednesday. The steamer Philadelphia has not made her appearance-consignees begin to feel some anxiety regarding her. Possibly she may have been detained at Havana, awaiting the arrival of the steamer from Aspinwall.

6. December 13, 1857 Nashville Union and American Nashville, TN
Article from Nashville Union and American, December 13, 1857

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Bank of Commerce, NASHVILLE, TENN, Dec. 12th, 1857. THE stockholders of this Bank have placed the assets la the hands of a Trusteetor the purpose of winding If up; those in debied to the Bank will please call and pay up as their indebtness falls due. The note holders will please send in our notes. as early as possible. and receive in return the notes of the Bank of Tennessee The individual depos. ites in this Bank have been banded over to IRC, and Ihereby pledge my individual liability for them and the money is rea y when called for. JOHN D JAMES. P. S.-There is a rumor in circulation in Nashville that W. H Gordon & Co., purchased a check in New York from the Bank of Commerce, and that A telegraphed to New York 10 stop the payment. This is false. the Bank had but one check to go 10 protest and was protested because tife Gold was demanded after the suspension of the Banks ID New York which was promptly taken up with the dımages when it returned. dec 13-15

7. January 23, 1858 Nashville Union and American Nashville, TN
Article from Nashville Union and American, January 23, 1858

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COMMUNICATED. # THE BANK OF TENNESSEE AND ITS MANAGEMENT. As there has been much said against the Bank of Tennessee and its present able and distinguished head, and little or nothing in favor of them, something on that subject, it is hoped, may not be considered improper. The suspension of specie payments by that bank has been condemned by some. To this it may be replied, that most of the best managed and soundest banks int he United States have suspended-banks over which men of the highest grade of mercantile integrity, honor, and punctuality, preside; men whose whole lives, public and private, like that of the head of the State Bank, are examples of justice and good faith to all men. Every well-informed man in the community knows that the suspension of cash payments by the State Bank was a matter of indispensable necessity, resulting from surrounding circumstances, and not a matter of choice, with a view to make a profit thereby to the State, by the injury to the holders of its million and a half of notes. A suspension by the State Bank, singly and alone, would, in most conceivable cases, have brought disgrace on its managers; but the State Bank is only one of 400 in the United States, the largest portion of which, and all at the great commercial centres, New York, Philadelphia, New Orleans, &c., have suspended. It is not necessary here to attempt an elucidation of the causes which have led to this result. A succession ef good crops and the high prices of our staples, Australian and California gold, and a general spirit of speculation and extravagance, engendered by a variety of causes, and aggravated by multiplication of banks, and by injudicious and indiscriminate loans, and the arbitrary displacement of masses of specie by the Eastern wars, must be regarded as amongst the most prominent causes which have produced the present difficulties throughout the whole commercial world. Under the operation of the general spirit of the times, the Legislature of Tennessee (an interior agricultural State, the trade of which consists almost entirely of the purchase of dry goods, groceries, &c., and the sale of raw produce) has put in operation upwards of forty banks, competing with each other for business, and pushing their notes into circulation-the pittance of specie required by the statutes not being sufficient, even if on hand, to meet an unfavorable state of exchanges, much less a panic. The banks at the great commercial centres, New York, Charleston, Savannah, New Orleans, and Philadelphia, in this state of things, had suspended. What was the State Bank to do under such circumstances? It was bound to pay near $100,000 in gold in the city of New York, on the first day of January last, either directly or contingently. A previous legislature had authorised a sale of the State stock in the Union and Planters' Bank, withs a view to increase the capital of the State Bank and to pay a debt of $125,000, due on matured bonds. That stock was not sold and the bank had to meet the debt out of its profits. It was paid. It had to pay interest on State bonds ($150,000.) It did pay it. It was responsible on endorsed bonds of railroad companies. It had to be in readiness to meet that interest to save the State from dishonor in the contingency of a failure of any railroad to meet the demand. One company did fail and the bank paid $12,000, and did save that road and the State from dishonor. The bank furnished gold in the city of New York for the whole of the railroad payments in lieu of State paper. All these liabilities, direct or contingent, it was bound to be prepared to meet in discharge of duties imposed on it by previous legislatures. To meet these and other liabilities, the bank had $2,000,000 in bills falling due at the commercial centres in suspended banks. The door by which it was expected to obtain gold was closed, and the only resource left was to collect in gold a portion of the notes discounted for the citizens of Tennessee, to wit: $1,600,000, to meet the metallic demand in New York and elsewhere. Just so certain as the bank had continued to pay specie in the midst of the circumstances by which it was surrounded, just so certain would every dollar of its cash have been drawn from it by brokers, as an article of traffic, shipped and sold where banks had suspended, and where it would have commanded a sufficient premium to make its shipment a profitable speculation; and just so certain would the bank have been left without the means of doing business, the people in some measure without a circulating medium, the State dishonored, and the president of the bank declared unfit for the position he occupies. Although suspended, it has paid out in gold $200,000 to those who needed it, yet did not obtain it as an article of traffic. It has furnished a large amount of exchange at one per cent, when it could at the market rates have exacted larger amounts. It has discharged all the obligations imposed on it by the State. It has been enabled to sustain its circulation, so as (like the Bank of England) to lighten the blow on the debtor interest to some extent, inflicted by a sudden reduction of the currency from, say $3,000,000 to $4,000,000; and its notes will now pay all domestic debts at par, and purchase all property, real or personal, at cash prices. It may be asked, did not the Bank of Tennessee contribute, by its management, to the suspension which now exists? To this, it is replied, that there is nothing to be found in the conduct of the bank to sustain in the slightest degree such a charge. It is evident from the past history of the bank for the four years under which it has been under the direction of its present vigilant directory, and its present condition, that there has been a consistent effort to avoid such an increase of its circulation and such injudicious loans, not based on the produce of the country, as would lead to imprudent and heedless speculation and indebtedness. It is well known to the author of this communication, as well as to many other persons, that the sagacious President of this bank has been predicting the present state of things, and that he has held the bank in a condition to meet the crisis which has come, as well as it could readily be done consistently with the duty imposed on it of supplying the community with circulation and answering in other respects the purposes of its creation. The amount of its circulation for the last four years, since Colonel Johnson has been at its head, is as follows: irculation 1st July. 1854 $2.471.830

8. April 6, 1858 Richmond Enquirer Richmond, VA
Article from Richmond Enquirer, April 6, 1858

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crisis. The suspension of specie payments in Baitimore, Philadelphia and New York, has just shut out Virginia capitaliste from their own specie, and, in the teeth of this recent experience, a large additional Amo nt is to be sent, by legislative authority, the vaulte of Baltimore, there to await another drop of e dead-fall. Again. If there be any advantage to be gained for Virginia, by thus stocking Baltimore with our specie, why does the General Assembly discriminate between the two sorts of Banks? Why are the independent Banks alone permitted to enjoy this pre cious immunity of choice between Richmond and Baltimore? Is it intended by this means to enable them to supplant their competitors? Or, is this scheme nothing more than a decoy duck, employe, to Jure the independent Banks to certain bankruptcy, by breaking down their credit at home, while it of fers the promise of enhancing their credit abroad? Another question. Is the State of Virginia to take the notes of these independent banks n payment of taxes? Is the State Treasury, as well as the citizen, obliged to send drafts to Baltimore, there to collect specie for public diabusements? So we interpret the late act of the Legislature. A previous Legislature degraded State credit by establishing a Virginia State Treasury brokerage at New York. The present act establishes another at Baltimore. We beg leave to explain to our readers, that we were not advised of the obnoxious features of this act, previous to its passage. Had we been so advised, we would not have failed to warn the public of the impending stroke. The bill was hurried through without mature consideration-scarcely - with an attempt at debate. In the House of Delegates, it pass. ed without 8 division, and many members of the House were ignorant of its provisions. The evil is now past present remedy. We have nothing left us but to regret an act of unwise legisla tion, and endure the consequences of another effort to provincialize Virginia. This is all. But this all is more than enough. It is noxious to State enterprise. It is degrading to State credit. It is bitter 88 gall to State pride.

9. May 31, 1876 New-York Tribune New York, NY
Article from New-York Tribune, May 31, 1876

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too great an expansion of credit. D bts in all forms became excessive. The railway system had been largely extended upon borrowed capital. There had been excessive importations of foreign goods. The banks loaned too much of their funds on stocks. bonds, and other securities that could not be readily converted into money to meet checks of depositors. The Ohio Life Insurance and Trust Company. which had a large branch office in the City of New-York, was completely loaded down with unavailable securities, and on the 25th of August, 1857, failed with very large liabilities outstanding This was the starting point of the panic. Distrust very soon be came general. Confidence was destroyed. It was soon ascertained that too much floating capital had been converted into fixed capital. Call loans were called in. A large part of the hun reds of millions of stock and bonds that bad been created during the previous 10 years proved to be unavailable. Wall-st. and the Stock Exchange necame greatly excited. A large number of the members of the Board of Brokers were onable to respond to their call loans, and failed. Stocks 10:50 per cent. At the hight of the panic New-York Central Railroad stock sold down to 48, Illinois Central Michigan Central, and Rock Island at about 30, Michigan Soathern at 5. Money WA 80 stringent that bankers were unable to borrow currency on gold bullion: the Michigan Southern sold at 10 per cent. guaranteed stock at 50, and the Michigan Central. an eight per cent mortgage bond, at the saide price. The panie continued about fifty days, mitil the middle of October, 1857. when all banks suspended specie payments. The system of redemption of bank-notes then in force by the Suffolk Bank 111 Boston, an the Metropoltan Bank in New-York, operated unfuvorably. This mode of requiring redemption of the interior bank currency which was sent in packages to these banks, and teen burried back again to the interior, frequently in the same packages, greatly accelerated the paine. Finally the banks in New York, by common consent, ceased sending home good currency and finally look the secured currency of the State of New-York, and made is a basis for Clearing-House Certificates which had an important influence in stop ing the panic and restoring confidence When the batiss suspended relief cause of course. Condidence gradually returned, money flowed into business chabbels, prices improved. and the banks were enabled to resume in December. THE CIVIL WAR. At the breaking out of the Rebellion in 1861, the Government of the United States had no national institution to resort to, like the Bank of England or the Bank of France, for aid to sustain the Union army and navy. It had only a barren sub-treasury, which in every effort of the Goverument to make loans was known to be antagonistic to the customary commercial operations of the State banks. Two important loan acts were passed at the extra session of Congress in July and August, 1861, authorizing a loan of $250,000,000. The Hon. Salmon P. Chase, Secretary of the Treasury. in his report in December, 1861, stated that there were about 1,600 local banks, and that the value of the then existing bank-note circulation depended upon the laws of 34 States and the character of