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the the of our portion bank ing state, of this on account to cred their great it, not but agagements, even suspension how of resorted to. such course that the confidence and good the community can be preserved, and, in the sequel, the best interests of the stitutions themselves promoted. New dangers to the banks are also daily disclosed from the extension of thatsystem of of which they are the pillars. Formerly our foreign commerce was principally founded on an ex change of commodities, including the precious metals, and leaving in its transactions but little debt. Such not now the case. Aided by ties afforded by the banks, mere credit has become too commonly the basis of trade. Many of the banks themselves, not content with largely ating this system among others. have usurped the business while they impair the stability of the mercantile com munity they have become borrowers instead of lenders; they establish their agencies abroad they deal largely in stocks and merchandise they encourage the issue of State securities until the foreign market is glutted with them and unsatis fied with the legitimate use of their own capital and the exercise of their lawful privileges, they raise by large loans additional means for every variety of speculation The disasr attendant on this deviation from the former course of business in this country, are now shared alike by banks and individuals. to an extent of which there is perhaps no previous example in the annals of our country asa willingness of the foreign lender, and a sufficient export of our productions to meet any necessary partia payments, leave the flow of creditundist appears to be prosperous; but assoon checked by any hesitation abroad, or by any inability to make payment there in our productions. the evils of the system are disclosed. The paper currenev which might serve for domestic purposes, is useless to pay the debt due in Europe. Gold and silver are therefore drawn. in exchange for their notes, from the banks. To keep up their supply of coin, these institutions are obliged to call upon their own debtors, who pay them principally in their own notes, which are as unavailable to them as they are to the merchants to meet the foreign demand The of calls of the banks, therefore, in such emergencies, necessity ceed that demand, and produce corresponding curtailment of their accommodations and of the currency, at the very moment when the state of trade renders it most inconvenien: to be borne. The intensity of this pressure on the community is in proportion to the previous liberality of credit and consequent expansion of the currency forced sales of property are made at the time when the means of purchasing are most reduced, and the worst calamities to individuals are only at last arrested, by an open violation of their obligations by the banks.a refusal to pay specie for their notes, and an imposition upon the community of a fluctuating and depreciated currency These consequences are inherent in the present system. They are not influenced by the banks being large or small, created by National or State Governments. They are the results of the irresistible laws ot trade and credit. In the recent events which have so strikingly illustrated the certain effects of these laws, we have seen the bank of the lar. gest capital in the Union, established under a National charter, and lately strengthened, as we were authoritatively informed, by exchanging that for a State charter, with new and unusual privileges-in a condition too,as it was said, of entire soundness and great prosperity- merely unable to resist these effects, but the first to yield to them. Nor is it to be overlooked that there exists a chain of necessary dependence among a these institutions which obliges them, to great extent, to follow the course of others, notwithstanding its justice to their own immediate creditors, or injury to the particular community in which they are placed. This dependence of a bank, which is in proportion to the extent of its debts for circulation and deposites, is not merely on others in its own vicinity, but on all those which connect it with the centre of trade. Distant banks may fail, without seriously affecting those in our principal commercial cities: but the failure of the latter is felt at the extremities of the Union. The suspension at New York in 1837 was every where, with very few excep. tions, followed, as soon as it was known that recently at Philadelphia immediately affected the banks of the South and West in a similar manner. This dependence of our whole banking system on the institutions in a few large citics, is not found in the laws of their organization, but in those of trade and exchange. The banks at that centre to which currency flows,and where it is required in payments for merchandise, hold the power of controlling those in regions whence it comes, while the latter possess no means of restraining them so that the value of individual property, the prosperity of trade, through the whole interior of the country, are made to depend on the good or bad management of the banking institutions in the great seats of trade on the seaboard. But this chain of dependence does not stop here. It does not terminate at Philadelphia or New York. It reaches across the ocean, and ends in London, the centre of the credit system. The same laws of trade which gave the banks in our principal cities power over the whole banking system of the United States, subjects the former, in their turn, to the money power of Great Britain It is not denied that the suspension of the New York banks in 1837, which was followed in quick succession throughout the Union, was produced by an application of that power and it is now alleged in extenuation of the present condition of so large a portion of our banks, that their embarrassments have arisen from the same cause. From this influence they cannot now entirely escape, for it has its origin in the credit currencies of the two countries it strengthened by the current of trade and exchange, which centres in London, and is rendered almost irresistible by the large debts contracted there by our merchants, our banks, and our States. It is thus that an in troduction of a new bank into the most distant of our villages, places the business of that village within the influence of the money power in England It is thus that every new debt which we contract in that country, seriously affects our own currency, and tends over the pursuits of our country its
