New-York, March 10, 1784.
My Dear Sir:
In my last to you I informed you that a project for a land bank had
been set on foot by Mr. Sayre, as the ostensible parent; but that I
had reason to suspect the Chancellor was the true father. The fact has
turned out as I supposed, and the Chancellor, with a number of others,
have since petitioned the Legislature for an exclusive charter for the
proposed bank. I thought it necessary, not only with a view to your
project, but for the sake of the commercial interests of the State, to
start an opposition to this scheme; and took occasion to point out its
absurdity and inconvenience to some of the most intelligent merchants,
who presently saw the matter in a proper light, and began to take
measures to defeat the plan.
The Chancellor had taken so much pains with the country members,
that they all began to be persuaded that the land bank was the true
Philosopher’s stone that was to turn all their rocks and trees into
gold; and there was great reason to apprehend a majority of the
Legislature would have adopted his views. It became necessary to
convince the projectors themselves of the impracticability of their
scheme; and to counteract the impressions they had made by a direct
application to the Legislature. Some of the merchants, to effect these
purposes, set on foot a subscription for a money bank, and called upon
me to subscribe. I was a little embarrassed how to act, but upon the
whole I concluded it best to fall in with them, and endeavor to induce
them to put the business upon such a footing as might enable you, with
advantage, to combine your interests with theirs; for since the thing
had been taken up upon the broad footing of the whole body of the
merchants, it appeared to me that it never would be your interest to
pursue a distinct project in opposition to theirs; but that you would
prefer, so far as you might choose to employ money in this way, to
become purchasers in the general bank. The object, on this supposition,
was to have the bank founded on such principles as would give you a
proper weight in the direction. Unluckily, for this purpose, I entered
rather late into the measure: proposals had been agreed upon, in which,
among other things, it was settled that no stockholder, to whatever
amount, should have more than seven votes, which was the number to
which a holder of ten shares was to be entitled. At an after meeting
of some of the most influential characters, I engaged them so far to
depart from this ground, as to allow a vote for every five shares above
ten.
The stockholders have since thought proper to appoint me one of the
directors. I shall hold it till Wadsworth and you come out, and, if you
choose to become parties to this bank, I shall make a vacancy for one
of you. I inclose you the constitution, and the names of the President,
Directors, and Cashier.
An application for a charter has been made to the Legislature, with
a petition against granting an exclusive one to the land bank. The
measures which have been taken appear to have had their effect upon the
minds of the partisans of the land bank.
The affairs of the bank in Pennsylvania appear to be in some
confusion. They have stopped discounts; but I have no apprehension that
there is any thing more in the matter than temporary embarrassment from
having a little overshot their mark in their issues of paper, and from
the opposition which the attempt to establish a new bank had produced.
Yours affectionately,
A. Hamilton.
J. B. Church, Esq.