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CHAPTER XIV.,

NATIONAL BANKING.

1. The present banking system was established by an act of Congress in 1863. The plan is quite different from any before in use, and commends itself to the whole country by the stability it gives to the currency in use in the transaction of its business, and the security it furnishes against loss of values common under the old systems. They are managed by private parties and corporations, apart from the government, but under a certain degree of supervision, and by its authority. By the act referred to any number of persons not less than five may associate themselves together for the purpose of banking, by compliance with the following conditions :

2. First : They must, under their hands and seals, make a certificate which shall specify

1. The name assiuned by such association.
2. The place where its business is to be conducted.

3. The amount of its capital stock (which cannot be less than $50,000), and the number of its shares.

4. The names of its shareholders, and the number of shares held by each.

5. The time when such association shall commence business.

6. A declaration that said certificate is made to enable such persons to avail themselves of the advantages of this act.

3. This certificate must be properly acknowledged before some competent person, and must be sent to the comptroller of the currency in the Treasury Department, to be recorded and kept by him. When this, and all other acts which the law

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requires, has been done by the association, the comptroller of the currency gives them a certificate under his hand and official seal, to that effect, and that they are authorized to commence business. This constitutes the association a corporation. They have the right to make and use a common seal, and have all the rights, and are liable to all the responsibilities of ordinary legalized corporations; and may exist not to exceed twenty years from the passage of this act. Every shareholder is made personally liable for the debts of the association or bank, to the amount of the par value of his stock.

4. In order to secure the holders of bills issued by these banks, they must deposit with the Treasurer of the United States, United States bonds bearing interest to an amount not less than one-third of the capital stock paid in. These bonds are safely kept by the Treasurer. The comptroller of the currency then issues to the bank an amount of bank notes equal to the amount of bonds thus deposited, less ten per cent. In case the bank should fail to redeem its circulating bills, its bonds are sold, and with the proceeds the comptroller of the currency redeems them, or orders them to be paid at the United States Treasury. The bonds held by the Treasurer as security for the redemption of the bills issued by the association, must be transferred to him in trust; thus giving him entire control of them in case it becomes necessary to sell them in order to redeem the bills of any association which may have failed to pay them on demand.

5. This act has brought a great number of banks into existence, besides organizing most of the banks formerly existing under State laws under this system; so that we have a nearly uniforın system of banking all over the United States. The bills of these banks pass in any part of the country, which was not often the case formerly. In case the bank should be mismanaged, or fail to pay for any cause, there is ample security for their redemption deposited in the United States treasury, where they will be paid on presentation.

6. The bill-holder is also better protected against manter

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feits than he was under the old system ; for all the bills issued by these associations are engraved by the government, and the plates and dies on which they are printed are kept by the comptroller of the currency in the Treasury Department. The engraving is done in the best possible manner, and it is exccedingly difficult to counterfeit them. Besides this, they all have the imprint of the seal of the Treasury on their face, and are numbered and countersigned by the treasurer and register. With all these guards and precautions, we have the best paper currency ever used since the establishment of the government.

7. This act necessarily threw upon the Treasury Department a great increase of labor, and in order to provide for it a separate bureau was created, which is denominated the bureau of currency, the chief officer of which is called the comptroller of currency. He acts under the general direction of the Secretary of the Treasury. This bureau is charged with the execution of this and all other laws that may be passed by Congress respecting the national currency. The comptroller of the currency is appointed by the President and Senate, has a deputy, receives a salary of $5,000 per year, holds his office five years, has an official seal, gives bonds to the amount of $100,000, aná takes and subscribes the oath of office prescribed by the Con. stitution and the laws. His duties are numerous and

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very responsible, he having hundreds of millions under his care.

The terın national banks, given to these institutions, and national currency to the bills they issue, were given from the fact that they were organized by an act of Congress, and that the security for the redemption of their bills consists exclusively of national bonds; no other securities will be taken.

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1. The United States government belongs to its people. Those people own property estimated at upwards of thirty billions of dollars. The public lands belonging to the government are between one and one and a half billions of acres. Besides, the public domains contain gold, silver, iron, coal, and a large number of other mineral deposits, chiefly in regions worthless for agricultural purposes, of unknown, but ascertained to be, at least, a very great quantity - enough to make all its present inhabitants millionaires if (besides paying the debt) their value could be divided among them. The capacity of the country for production is very far beyond what is drawn from it now. The future will probably increase it a thousand fold, for we are yet a new people, and in the act of settling ourselves to the work of development.

We are very rich, if all our resources are taken into account, yet we are in debt. In five years from the commencement of the civil war the public debt had run up from less than one hun. dred million dollars to over two billion seven hundred millions. This we began to reduce at once, for as a nation we do not like to be in debt; and it was, December 1st, 1873, a little over two billion one hundred and fifty millions. The debt is, indeed, a trifle compared with our vast national property; but we do not wish to sell our property at a loss, nor disturb the regular course of business ; so it stands to be gradually paid in the regular course of things, as we find it to be convenient. It is a vast sum, but gives more trouble by reason of the

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desire and determination of the people to pay it soon, and
sacrifice no property, than from any inability to meet it.
The statement of the Public Debt are for each fiscal

year
ending June 30th: and from 1869 they are given with the
accrued interest less the cash in the Treasury and the Railroad
Bonds.
THE PUBLIC DEBT OF THE UNITED STATES,

In Each YEAR, FROM 1791 to 1878.

TERS

ople

hirty

and

791. .75,463,476.52
1782

77,227,924.66
1793. 80,352,631,04
1791. 78,427.404.77
1795. .80.747,587.38
1796. .83,762,172.07
1797. 82,061,479.33
1798 79,228,529.12
1799. .78,408,669.77
1800. ..82,976,294.35
1801. 83,038,050.80
1802. 80.712.632.25
1803

77,054,686.30 1801 86,427,120.88 1805.

82,312.150.50 1806, -75,733.270.66 1897 69.218.398.64 1898 65,196,317.97 1809

57,023,192.09 1810. -53,173,217.52 1811, -48.005,587.76 1812. - 45,209,737.90 1813. -55,962.827.57 1814, .81,487.846.94 1815: 99.833,660.15 1816. .127,331,933.74 1817 ,123,491.965.16 1818 ..103,466,633.83 1819. ...95,529,648.28 1878.... 2,035,786,831.82

1820. 1821 1822 1823. 1824. 1825.. 1826. 1827 1828. 18:29. 1830. 1831. 1832 1833. 1834. 1835. 1836. 1837. 18:38 1839 1810. 1841 1842. 1813. 1814. 1815. 1816. 1817. 1818.

91,015,566.15
.89,987,427.66
93,516,676.98
90,875,877.28
90.269,777.77
83,789,432.71
81,051,059.99
73,987,357.20
67,475,043 87
58,421.413.67
48,565,406.50
39,123,191.68
24.322.235.18
.7,001,032.88
-4,760.081.08

351,989.05

291.089.05 1,878,233.55 -4,857.660.46 11,983,737.53 .5,125,077.63 -6,737,398.00 15,028,486.37 27,203,450.69 24,748,188.23 17,093,794 80 16,750,926.33 38,956,623.38 48,526,379.37

1819. 64,704,693.71 1850. ..64,228.238.37 1851. 62,560.395.26 1852 65,131.692 13 1853. 67,340,628.78 1851. 47.242,206.05 1855. 39,969,731.05 1836. 30.963.909.64 1857

29.060,386.90 1839

44.910.777.66 1859. .58,754.699.33 1860. .64.769,703.08 1861. 90,867,828.68 1862.. .514,211,371.92 1803... 1,038,793.181.37 1861... 1,740,690.489.49 1865.... 2,680,647.869.74 1866... 2.773,236,178.69 1867 2,678,126,103.87 1868.

2,611,687,851.19 1869. 2,489,002,480.58 1870. 2,386,358.599.74 1871.... 2.292.0:30,834.90 1872.. 2,191.486.343.62 1873... 2,147.818.713.57 1874.... 2,143,088.241.16 1875.... 2,129.688,726.32 1876.... 2,099,439,314.99 1877.... 2,060,158.223.26

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11.

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SIXES OF 1861.-Dated 1861, and redeemable in twenty years from January 1st and July 1st of that year. Interest six per cent. in gold, payable semi-annually-January 1st and July 1st. These Bonds were issued in three series : Under Act February 8th, 1861, $18,415,000; dated variously in 1861. Under Acts July 17th and August 5th, 1861, $50,000,000; dated November 16th, 1861. Under Acts July 17th and August 5th, 1861, in exchange for 7-30's, $139,317,150; dated November 16th, 1861, Under Act March 3d, 1863, and principal made especially payable in gold coin, $75,000,000; dated June 15th, 1864. Total issue, $282, 732,150.

FIVE-TWENTIES OF 1862.-Commonly termed Old Five-Twenties, dated May 1st, 1862
Redeemable after five years, and payable in twenty years from date. Interest six per
sent. in gold, payable the first of May and No mber. Issued under Act February 25th,
1802, $514,771,600.

FIVE-TWENTIES OF 1864.-Dated November 1st, 1864. Redeemable after five, and pay.
able in twenty years. Interest, six per cent. in gold, payable 1st of May and November,
Issued under Act March 30, 1864 (principal specified as payable in gold), $3,882,500. Issued
Ander Act June 30th, 1864, $125,561,300. Total issue, $129,443,800.

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