1. The capital of the bank is to be compounded of specie, of public
stock, and of Treasury notes convertible into stock, with a certain
proportion of each of which every subscriber is to furnish himself.
The amount of the stock to be subscribed will not, it is believed, be
sufficient to produce in favor of the public credit any considerable or
lasting elevation of the market price, whilst this may be occasionally
depressed by the bank itself if it should carry into the market the
allowed proportion of its capital consisting of public stock in order to
procure specie, which it may find its account in procuring with some
sacrifice on that part of its capital.
Nor will any adequate advantage arise to the public credit from the
subscription of Treasury notes. The actual issue of these notes nearly
equals at present, and will soon exceed, the amount to be subscribed
to the bank. The direct effect of this operation is simply to convert
fifteen millions of Treasury notes into fifteen millions of 6 per cent
stock, with the collateral effect of promoting an additional demand for
Treasury notes beyond what might otherwise be negotiable.
Public credit might indeed be expected to derive advantage from the
establishment of a national bank, without regard to the formation of its
capital, if the full aid and cooperation of the institution were secured
to the Government during the war and during the period of its fiscal
embarrassments.
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