Of this debt, about five hundred millions is held abroad, or on foreign account. The residue, making nearly twelve hundred millions, is held among the citizens of the country. It is obvious, from this state of fact, that the solvency of the country depends on the solvency of merchants and individuals. It is private credit which at last sustains the whole fabric. The $250,000,000 of railroad bonds will be easily paid, and double as much more, if the individuals who have subscribed railroad stocks can make good their subscriptions in cash. It is undoubtedly true, however, that a great deal of railroad stock has been subscribed on the idea that money can be borrowed, lands sold, and property realized at advanced prices. A rising market, increased supplies of gold, and a prudent conduct of business, will enable stockholders to pay their subscriptions; but it is evident that in the extension of credits now apparent, there must be great prudence in the conduct of business. "Make haste slowly," is an ancient maxim which contains much practical wisdom. We have seen no attempt (and ours is only an attempt,) at solving the problem of general indebtedness, which we have undertaken above. We believe that the first five classes of debt described above, are very nearly correct. The last is the one which presents the greatest difficulty, and we can only say as to that, we have not overrated it. If the above statement be correct, the entire indebtedness of the country is about 20 per cent on the entire value of property in the nation. RESOURCES AND LIABILITIES OF THE BANKS IN CONNECTICUT. We give below an abstract from the Bank Commissioners' Reports for each of the last 17 years-that is, from 1837 to 1853, inclusive: ABSTRACT FROM THE BANK COMMISSIONERS' REPORTS FOR THE LAST SEVENTEEN YEARS. Loans and Years. 1837.... 1838. 1839. 1840. 1841. 1842. 1843. 1844. 1845... 1846. 1847. 1848. 1849. 1850. 1851 1852. 1853. Capital. Circulation. $8,744,697 $3,998,325 $15,715,964 8,754,467 1,920,552 12,302,631 8,832,223 3,987,815 14,942,779 8,878,245 2,325,589 12,950,572 8,873,927 2,784,721 13,866,373 8,876,317 2,555,638 13,465,052 8,580,393 2,379,947 12,914,124 8,292,238 3,490,963 14,472,681 8,359,748 4,102,444 15,243,235 8,475,630 4,565,947 15,892,685 8,605,742 4,437,631 15,784,772 8,726,381 4,891,265 16,808,829 8,985,916 4,511,571 16,947,002 9,907,503 5,253,884 19,122,209 10,575,657 6,639,834 21,999,949 12,509,807 7,118,625 25,226,502 825,379 20,552,493 25,226,502 13,950,944 11,217,630 32,098,899 1,259,872 25,833,850 32,098,899 From the foregoing tables it will be seen that there are fifty-five banks in the State, including five organized under the General Banking Law of the Legislature of 1852, with an aggregate capital of Aggregate Surplus Fund. Aggregate Deposits, April 1, 1853. Total..... upon which the circulation of the banks of the State is predicated. $13,950,944 50 1,182,953 88 4,421,667 93 $19,555,566 31 The Bank Commissioners, who have personally visited and examined all the banks in the State, in accordance with the requirement of the statute, believe them to be in a sound condition; and, though the failure of the Eastern and Woodbury banks caused, for a time, suspicion to rest upon them, the trying time has passed, and we trust that general confidence is restored, and that they will again resume that high standing which they have so long and deservedly maintained. In addition to the quarterly returns, the commissioners obtained from the books of the banks, on or about the 1st of November, 1852, a statement of their condition at that time, in regard to the items embraced in the following table : 24,520,098 21 10,347,945 1,015,839 38 1,853,000 At that time the loans and discounts, and the circulation of the banks of the State, were higher than they had ever been before, but they have since been considerably increased. CIRCULATION. The great demand for Connecticut currency at the West, within the last few years, has had the effect to introduce a new feature into the banking business of the State. The Commissioners allude to the practice of loaning to parties the bills of the banks, at rates varying from three to six per cent per annum, the borrower guarantying their redemption in the same manner as if they were his own obligations. The bills so loaned are marked in such a way that they are readily detected at the counter of the bank, and at once returned to the borrower, who redeems them. This is called "protected circulation," and amounted in November last to $1,353,000. It is believed to be far above this sum at the present time. It must be apparent that this system cannot be called legitimate banking. It places the bank resorting to it in a critical condition in case the borrowing party fails to redeem, according to the terms of his contract, and a large amount of their circulation is thrown back upon them at a time when they are not prepared to meet it. Such a case has occurred within a limited period, and had it not been that the collateral security held by the bank was of such a nature that it was immediately convertible into cash, their embarrassment would have been severe, especially as the circumstance occurred at the time of the failure of the Eastern and Woodbury Banks, when an unusually large amount of their ordinary circulation was returned for redemption. As it was, their credit received a shock from which it has not yet entirely recovered. The system of protected loans and issuing on deposits, has given the banks facilities for making large dividends. And for the past few years investments in bank stocks have been so profitable as to induce almost every capitalist to purchase such stocks at large premiums, and to withdraw all loans upon other safe securities, where the legal rates only were obtained. Thus every business man is at the present time compelled to borrow of banks, when formerly loans were obtained from individuals. And it may be questioned whether the general interest and prosperity of the State is not injured by the absorption of so large an amount of capital, which, if invested in the various industrial pursuits, would be productive of more real wealth and general prosperity. The power given to banks by their charters, of maintaining a circulation equal to "fifty per cent over and above the amount of capital stock actually paid in, and the moneys deposited for safe keeping," we would suggest should be modified so as to deprive them of issuing upon the strength of their deposits. Deposits are indebtedDess. Circulation is also indebtedness. Thus, to maintain a circulation upon deposits, is simply to build up one species of indebtedness upon the basis of another—a proposition which cannot recommend itself to our approbation. The fact that only three banks in the State have resorted to their deposits as a basis for circulation, would indicate that no more fitting time than the present could be fixed upon to put a stop to the system. POSITION OF THE BANKS OF ENGLAND AND FRANCE IN 1852-3. As great interest attaches just now to the late changes and actual position of the Banks of England and France, we subjoin a detailed statement of the more important variations which have taken place in the two establishments, since the beginning of September, 1852, when the drain upon both appears to have commenced. The returns of the Bank of England include the payment of the half-yearly dividends in the English funds. It will be observed, that the position of the Bank of France has undergone serious alterations within the last few months, and that the future returns of this establishment must be watched with increased attention. The Bank of England has, simultaneously, suffered a diminution of resources, but in a far smaller propor tion, and chiefly for the legitimate purposes of Commerce. The metalic reserves of both establishments, it will be observed, were nearly equal, which is a singular coincidence. CONDITION OF THE BANKS OF NEW ORLEANS. STATEMENT OF THE BANKS IN NEW ORLEANS ON THE 26TH OF JUNE, 1853. BANKING SYSTEM OF NEW HAMPSHIRE. The Governor of New Hampshire, in his last annual Message to the Legislature of that State, thus refers to the condition and character of the Banks: "The present Banking system of the State is sound and popular. The Banks of deposit, discount, and circulation, to the number of thirty-three, with an aggregate capital of $3,226,000, all paid in, are in the hands of honest, responsible, and accommodating financiers, rendering them safe to the public and remunerative to the stockholders. They are well distributed to the different sections of the State, and so located as to accommodate the business operations of the community. Their stocks are diffused among all avocations, individuals holding but small quantities, the policy being to have all interested in them who have money capital more than they require in their ordinary business, even if but small in amount. The Savings Institutions, or Banks of Deposit and Loan, are sixteen in number, and have an aggregate capital of $2,132,218. The management of these institutions is judicious, as far as can be ascertained from the reports of the bank commissioners; they seem to be confided to good hands, and are performing their important functions with a steadiness and fidelity which entitle them to the undoubting confidence of the depositors. It will be perceived from the foregoing, that in our business operations we have money capital through our banks, to the amount of $5,358,212, by which to aid credit and facilitate exchanges, and to this might be properly added the average deposits in our banks of deposit, discount, and circulation. GOLD COINED IN ENGLAND, FRANCE, AND UNITED STATES. GOLD COINED IN THE UNITED KINGDOM IN THE 50 YEARS ENDING 1850. SILVER COINED IN THE UNITED KINGDOM IN THE 50 YEARS ENDING 1850. In the 1st period of 40 years, ending 1840.. 1847. 1850. £11,203,215 1,254,394 £15,871,550 £280,052 364,518 94,710 GOLD COINED IN THE UNITED STATES IN THE 50 YEARS ENDING 1850. In the 1st period of 40 years, ending 1810..... 2d 66 £5,647,328 £141,183 SILVER COINED IN THE UNITED STATES IN THE 50 YEARS ENDING 1830. In the 1st period of 40 years, ending 1840. GOLD COINED IN FRANCE IN THE 50 YEARS ENDING 1850. SILVER COINED IN FRANCE IN THE 50 YEARS ENDING 1850. In the 1st period of 40 years, ending 1840.. SUMMARY OF GOLD AND SILVER COINAGE IN THE 50 YEARS ENDING 1850. |