States. No. 14.-Statement exhibiting land concessions by acts of Congress to States for canal purposes from the year 1827 to August 1, 1866. Date of laws. Statutes. Page. Name of canal. Total no. of acres granted. 1,439,279 3, 1845 5 731 200,000 July July 3, 1866 Printed laws, a. 92........do.. do.. .do. 200,000 100,000 THE THREE PER CENT. LEGAL TENDER CERTIFICATES. In obedience to the law of 2d March last directing the issue of these securities to the amount of 50 millions for the redeeming of compound notes, Mr. McCulloch has published the requisite notice, and is now giving out the certificates in exchange for the October and December compounds, the aggregate of which will probably absorb the whole issue. It is very much to be regretted that the Secretary did not earlier announce this intention; for, perhaps, he might have diminished the shock which the money market suffered from the sudden locking up of 13 millions of greenbacks at a critical moment, in the New York Sub-Treasury! Nothing can more impressively illustrate the varying sensitiveness of the money market than the events of the past few days. The withdrawal of greenbacks and compounds during the month of August was heavy, but it failed to make the slightest ripple on the stagnant surface of the money market. A month later Mr. McCulloch acted as if he thought he could still with the same impunity withdraw greenbacks from the circulation. He ventured to lock up a few millions, but no one knows how many millions because the Treasury balance published daily puts together in one aggregate with the greenbacks on hand, national bank notes, compounds and even gold certificates, as well as redeemed Seven-Thirties. It is enough to know that large amounts of greenbacks were daily taken out of the circulation and stored away in the government vaults. In nine days the withdrawal was arrested, and the reverse process began, and seems to have continued with little interruption ever since. But it was too late. It was a critical time. The money market had received the shock, and the mischief was done. The Treasury balance has since been depleted from 133 millions to 107 millions, but to little purpose, so far as the move. ments of the loan market are concerned. For yesterday money was extremely active, and indeed by some persons was declared to be more stringent than at any previous time since the flurry set in. The truth probably is that the worst of the pinch was over several days ago in the money market itself, but the resulting effects at the Stock Exchange are only partially developed. These effects are various. At first there was a general fall in the more mercurial securities, government bonds standing firm. The next phase was a reactionary rise in the former, while the latter fell, and are still falling, to the great injury of holders of Five-Twenties and other bonds throughout the country. Do we then suppose that the fall in Governments is due solely to the monetary pinch? By no means. There are other well-known causes at work, and the speculators are very busily exaggerating them. But those causes, we think, would not have had the depressing power they have-they would perhaps have had no such power at all-had not public confidence received that unhappy previous shock through the money market, which we regard as the chief bringer-on of the existing depression. It has been rumored about that some of the speculative advisers who were most anxious that Mr. McCulloch should tighten the money market towards the close of September, set before themselves as the end of their scheme a fall and a subsequent rise in gold. If this were so the object has been accomplished. Gold has been down to 1421, but has risen again above 145. These persons are also credited with the desire to put down railroad and government securities. Here also they have not failed. Railroad shares, before they "touched bottom" and rallied again, suffered some 6 or 8 per cent. depreciation, and government bonds, though previously so low in comparison of their intrinsic worth, are down 3 per cent., and appear to be going lower. This fall in securities has, no doubt, given an impulse to speculation, has attracted money into the pockets of the money lenders, and has ripened a rich harvest for operators in stocks and in gold. But what real solid good has it conferred upon the country? Or, rather, who can measure the evil which so sharp a monetary spasm may not have done? We repeat now, as we said last week, that there is an entire absence of evidence that Mr. McCulloch had an idea that any such mischievous consequences were imminent. He had, it must be believed, no design or intention to produce such disasters. But if they have really been induced, and if they are the effects flowing directly from the causes specified, then it is of the gravest moment that the truth should be pointed out in so distinct and luminous a way, that a similar error may never be made again by Mr. McCulloch, or by any future Secretary of the Treasury, or by any other official having power to increase or diminish the currency, when the fall drain sets in from the West. Now, with regard to the certificates. They will bear the uniform date of 15th October, and will be of the denomination of $5,000 and $10,000. Almost the only questions, however, which the public care to ask about these securities, are, will they give ease and steadiness to the money market? Will they undo the evil that has been caused? The most conflicting opinions prevail on these points. Almost all parties agree, however, that the certificates will afford temporary relief if they put an end to the feverish suspense and incertitude as to the action of the Treasury, which is at present regarded as the chief disquieting force in operation. Besides this, however, the certificates will doubtless place the banks in an easier position by enlarging the amount of floating paper available for bank reserves. Of the 50 millions of October and December compounds which will be transmuted into certificates, a part only are held by the banks. The rest are in the hands of private individuals, and the aggregate, when exchanged, will pass into the banks and make these institutions more easy in point of reserve than they have been for some time. So confident are some persons of experience that this will be the way in which the certificates will work, that they predict the issue of 50 millions more as a consequence of the efficiency with which they will perform the functions for which they were authorized by Congress. REFORMS IN THE NATIONAL BANKS. The closing of the Croton National Bank of this city a few days since, and the troubles in some other institutions of equally small importance in various parts of the country have produced no prejudicial influence whatever outside of a very narrow circle. These events have rather a reassuring than a depressing effect. For they show that the Internal Banking Law is so vigorously administered that the weak members of the sisterhood of banks must be strengthened or they will be re moved. Nor is there any prospect that this vigor will be relaxed. On the contrary, some further improvements in the law are demanded for the stability of our financial system, and for the safety of those great public interests with a view to which the banks exist and are endowed with their special privileges. Few real friends of the banks will object to such an improvement, for instance, as we contended for last week in the redemption of the National Bank notes in New York. We are glad to see that the newspapers are beginning to agitate this measure of reform, for which there is so urgent a pressure of public opinion that its enforcement is a mere question of time. Some well-informed men are so sanguine as to affirm that it will be adopted by Congress at the ensuing session. This opinion is ably advocated by the Washington Intellig encer, which on the 2d October, made upon the subject the following very pertinent observations: Cur "The projects before Congress last winter in reference to the modifications of the national Bank system entirely failed, and they will, no doubt, be revived at the coming session. The experience of the last few months has enjoined the necessity of some modification of the system. The recent prostration in the money market, the sudden rise of the rate of interest, and the fall in stocks may be ascribed in a great measure to the want of a uniform mode of reducing the national bank issues. rency was abundant everywhere in the summer when it was not wanted; but in the fall, when wanted for moving the crops, and other business operations, it became scarce. The Comptroller of the Currency recommended to Congress, as a measure that would meet this and other difficulties appertaining to the present system, a plan for the redemption of national bank issues at some one or more central points. The Committee on Banking and Currency reported a bill for that purpose, which was not acted upon, and, meanwhile the banks in the interior manifested much op. position to it. It is now contended that such provision for redemption New York would give elasticity to the currency, rendering it abundant for all occasions when the activity of business should require it. Now it is abundant for speculation, at a low rate of interest, at seasons when it is not wanted for regular business. The inequitable distribution of the national bank currency is another source of evil and has given rise to much complaint in the South and West. The opposition to the banking system has been manifested in some quarters upon this ground alone, and strong combinations will at some time be made against it, unless the defect be remedied. Several remedies were proposed in the last Congress, but not adopted. An increase of the currency for the purpose of effecting a more equitable distribution was recommended on one hand, and another proposition was made to scale the shares allowed to the North and East and distribute this excess in the South and West." Those who are opposed to reforms in our banking law urge that it is unsafe to confer so much financial power as the National Bank Act places in the hands of certain officials of the Government. This argument might be valid if no such institutions as our 1,600 National banks had been organized, and if no such law had ever been passed to collect the banks of the country into one great organized community. But having so organized these banks, the country is bound to make the sys tem under which they act as perfect and as safe as possible. Our banks may object to various requirements of the law. Some may find irksome the searching reports exacted of them as to their condition at the close of every month, every quarter, and every half year. Others may be restless under the obligation to keep on hand 15 or 25 per cent. of legal tenders as reserve. And a third class may find fault with what they call the inquisitorial visits of the official Examiners, who periodically investigate and report to Washington the state of their business as it appears on the face of the bank books. But these objectors must remember that a bank is not a close corporation. It is a public institution. It plays an important part in the monetary machinery of the country. Its functions are not primarily to make money for its owners, but to fulfil certain high functions with a view to the public, good. That public good requires that our banks should act under the fullest light of publicity. Such is the demand where a bank does a simple banking business of receiving deposits and making discounts or loans. But when, as has been usual in this country, the banks are permitted to issue notes to circulate as money, the need of publicity is infinitely in creased. If a bank fails now, its failure interests a vast multitude of persons scattered far and wide through the country. Hence the safeguards and preventions against bad banking need to be all the more efficient and large. It will be remembered that at the spring session of the Legislature of this State, the objections to National banking were discussed in connection with a proposed "enabling act" to permit our city and State banks to withdraw from the National organization, and to bank under State laws. This law was passed 20th April, 1867, and as it is of some special interest at the present moment, we copy its chief provisions as follows: SECTION 1. Whenever any banking association, organized and doing business under the act of Congress, shall dissolve its organization as such national banking association, it shall be lawful for a majority of the directors of such dissolved organization, upon the authority in writing of the owners of two-thirds of its capital stock, to execute the certificate of association required by section sixteen, chapter two hundred and sixty, laws of eighteen hundred and thirty-eight of this State. SEC. 2. Upon the execution and proof, of acknowledgment of such certificate, as required by section sixteen, aforesaid, which certificate shall further declare the authority derived from the stockholders pursuant to the provisions of the first section of this act, and upon filing a copy thereof in the office of the superintendent of the bank department, with proof that the original is duly recorded in the office of the clerk of the county where any office of such banking association shall be located, such association shall be held and regarded as a banking association under and in pursuance of the laws of this State; and there upon all the assets, real and personal, of the said dissolved national banking association, shall immediately, by act of law, and without any conveyance or transfer, be vested in and become the property of such State banking association; and the directors of the dissolved organization at the time such dissolution, shall be the directors of the association created in pursuance hereof, of until the first annual election of directors thereafter. SEC. 3. Nothing in the banking laws of this State shall be construedas requiring any banking association or individual banker to issue circulating notes.—Laws of 1867 Chap. 475. |