Nor is it to be overlooked that there exists a chain of necessary
dependence among these institutions which obliges them to a great extent
to follow the course of others, notwithstanding its injustice 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 deposits, is not merely on
others in its own vicinity, but on all those which connect it with the
center 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 everywhere, with very few exceptions, 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 cities is not found
in the laws of their organization, but in those of trade and exchange.
Pages:
643
644
645
646
647
648
649
650
651
652
653
654
655
656
657
658
659
660
661
662
663
664
665
666
667