The banks of New York, their dealers, the clearing-house, and the panic of 1857..

Front matter

A Veteran Specie Clerk.

THE BANKS OF NEW-YORK,

THEIR DEALERS, THE CLEARING HOUSE,

Chapter I

Intbodttction— Number of Banks, and their Managers and Clerks— "What Banks Represent— "What a Bank is— The New York System— How a Bank is organized, and by whom managed — Technical and Slang Terms.

Chapter II

The Pbesident— His Legal Relations to the Bank— Should be a Man of Education and superior Character— The Board of Directors Transacting Business — Offerings for Discount — Rambling Conversations— The Artistic Diversions of Mr. Marks — Discounting Paper, and Discussions of Character— Narrow-minded Directors — Operations in Sugar — Directors Crotchett and Buttonwood — Adjournment—Director Miller pays a Note of $10,000— Two Characters of a President in contrast — Personal Habits of Dealers enquired into— Commercial Agency Reports — Great Influence of the President — Examining Collateral Notes — Jonas Marks (confidential)— Claims of Directors conflicting with the Rights of Dealers— A Particular Friend in Trouble.

Chapter III

The Cashieb — His Special Duties — Power of Appointing and Removing Him — Not Subordinate in Everything— The Correspondence— A Tight Market— Receiving New Accounts — Personal Solicitation— Mr. A. "Won't submit to such Treatment" — In Debt to the Clearing House — Eiting — The Cashier in a state of Siege— Mr. Sweatem's Expostulation— Mr. Boyle in a Rage— A Great House Saved— Complaints of Dealers— The Right Character for a Cashier— Two Hundred Thousand Dollars Stolen.

Chapter IV

The Paying Telle*— His Duty, Bonds, and Salary— Custody of the Vault, and Keeping of the Key— Desk Arrangements — Sends Exchanges to Clearing Houso —Certifying and Paying Checks — Certification Check-list — Peculiarities of Checks — Careless Habits of Merchants — Ingenious Forgery Detected — Losses never Discovered— A Successful Forgery of $10,000— Classification of Accounts — Impositions on the Teller— Samuel Filibuster Overdraws his Account— Identifying Indorsers— Certifying Checks in Advance of the Deposit— Various Inci-

vii

Vlll CONTENTS.

dents — Ignorance of Bank Usage — How Alexander Jones may cheat — The Failure of Skarem & Co.— The Teller's Proof— Cheating by Certification— A Narrow Escape.

CHAPTER Y.

The Deposit Teller — His peculiar Duties, and the Forms of his Account- Books — Forms of Exchange and Proof-list — Of what Deposits consist— Abel Dodge deposits kiting Checks, and then fails— The Teller has great Influence in determining the Character of the Business— Detection of Spurious Bills- Rapid Counting — Claims for Differences— Disputes— Improved Discipline— A Thousand Dollars Short — The Teller appealed to by the Cashier — Causes Accounts to be closed — How he corrects the Errors of Dealers — A Poor Shoemaker waiting for a Deposit

Chapter VI

The Note Teller— Classes of Notes— Form of Collection Note-Book— Adding Cash Checks from Morning Letters— Paying Notes, and saving Tickets— Errors of Note-makers — The Wrong Person served — Various Incidents.

Chapter VII

The Discount Clerk— The Difference between Interest and Discount— Offering of Notes for Discount— Examples— Transcription of Records— Discount Ledgers — Proof of Accounts — Dealers calling, after a Board Session, to know what luck— The manner in which they are affected by Disappointment— Terribly Tight Times— Mr. Axletree— A Fraud.

Chapter VIII

The Note Department— Notes the great Instruments of Commerce— The Collection Register— Consequence of wrong " Timing" of Notes— Page of Register and Tickler— Custody of Notes.

Chapter IX

The Book-keeper — His necessary Qualifications — The Alphabetical Arrangement of Accounts— Balancing Accounts— Answering the Paying Teller's questions from memory — John Brown gets a Notice, and proves that Alexander Jones ought to have had it— A Fraud— Scale of Apportionment for a Ledger.

The Runneb — Prepares the Bank Notices for Distribution— Collects Sight Drafts, &c— Serving Notices— Difficulty of always finding the right Man— Collects Information, and imparts it to the Officers— Serves as Talesman on a Jury.

Chapter XIV

The Pobteb— The Keys of the Bank Building in his Custody— General Duties- Counting Coin— His Skill in Detecting Counterfeits— The Old-fashioned Pouch —The Cashier in a pet, because Donaldson won't stay in two places at the same time— Messenger to other Banks— Is the Bank's Letter Carrier— Reports Delhi not taken— Assists the Paying Teller— Tries the Door, to be sure that it is locked —Appointed to the Dignity of Specie Clerk— Long and honorable Career of the Bank Porter— A Yeteran in the Service— The Gold Spectacles.

Chapter XV

Presents— No Favor in Banking between the Officers and the Dealers ; or if so, from the latter to the Bank— Presents have a bad Influence, and lay the basis for Fraud— Anecdotes— Practice of Geobge Cubtis, Esq., late President of the Continental Bank.

Chapter XVI

Bank Discipline— Source of the fears of Bank Officers with respect to Fraud- Plans of Gamblers— The profitable occupation of Leisure Hours— A System of Daily Reports.

Chapter XVII

How to Tbansact Business with a Bank— Short Rules and Recommendations.

Chapter XVIII

The Clearing House.— The Old Plan of making Exchanges— The Porter's Settlement—Irritations and Impositions— Origin of the Clearing House— Constitution of ditto — The Rooms — The Daily Routine— Forms of the several Tickets used — An amazing Amount of Work done in Six Minutes — The Time saved —Extraordinary Skill of the Settling Clerks— Clearing House Proof— Method of Discovering Errors— Scale of Fines— Specie Certificates and Easy Settlements—Reclamation for Differences, how Settled— Summary of Work Saved over the Old Method— The Records— Their Great Value and Use— A Clear Principle in Banking demonstrated— Limiting Influences— The Weekly Statements—The Quarterly Statements good for nothing before the Clearing House was organized — Improvement in the whole System of Banking brought about by the Clearing House— The Result of Five Years of Trial— The Expenses of the House— The Admirable System and Order of its Accounts— Tables, illustrated by a Financial Chart, for the Guidance of the Bank Board— The first Proposal for a Clearing House.

CONTENTS.

Chapter XIX

The Panic— A General Sketch— Gradual Eeduction of Loans for Four Years— The Failure of the Ohio Life Insurance and Trust Company, and its Effect on the Weekly Statements — A great Change wrought in one Day — The Eeduction of Loans not caused by the withdrawal of Deposits— The Fluctuating Part of the basis of Bank Loans considered — The Steadiness of the Bank Deposit — Contrast in the Fall of Securities in two periods — The Final Blow — Cause of the Panic— The Influence of the Specie Settlements of the Clearing House— An Alleviation — The Chart — Separate Expansion cured, but Harmonious Expansion allowed — Measurement of Expansion by Specie Eeserve — Proportion of Specie recommended— An Exception— The Difficulties of Bank Government- Incompetent and Dishonest Officers — The Independents List of Failures — "What the Panic Developed — Personal Credit the Cause of Fluctuation — Bank Currency — No Connection between Loans and Circulation — Bank Note Eedemption — Objections and Errors — Trade in Bills — Will Suspension occur again? — A Financial College— Anomalies in the Banking System — The Ox goring the Bull— Practical Absurdities— Notions about Gold— Its exact office — Causes of its accumulation in New York.

ILLUSTKATIONS.

PAGB

1. The Specie Clerk op the Union Bank,— Frontispiece.

2. The Board op Directors discounting Notes, ..... 31 8. The artistic Diversions of Mr. Marks, 33 .

4. The President examining Collateral Notes, 61

5. Just Elected, 70

6. Mr. A. won't submit to such Treatment, 82

7. The Cashier caught by the Button-hole, 84

9. Mr. Kight down, 88

10. The Cashier in a State op Siege, 90

11. Mr. Sweatem's final Argument, 91

12. A bad Bank Statement, 93

13. The Paying Teller and his Customers, 144

14. A tight Day at the Discount Desk, 199

15. Consolation— Better fare than at the Discount Board, . . 209

16. Outside— Two per Cent a Month, 210

17. Inside— The Consequences op Two per Cent a Month, . . 212

18. The Bunner on a fruitless Search, 249

19. Matthias, Porter op the Bank op the State op New York, , 264

20. Father Cole, 269

21. An old-fashioned Friday's Settlement, . . ... . 294

22. Plan op the Clearing House Booms, 303

23. The Clearing House Manager in his Pulpit, .... 806

24. Making the Daily Exchange, 307

25. A Ton of Gold, 315

■26. The Specie Clerk with Half a Million in his Pocket, . . 816

27. Financial Chart, 336

28. Wall Street on the Day op Specie Suspension, .... 846

29. A "Kun" on a Bank, 861

80. The Financial Chart reduced, 367

81. Diagram of Currency and Loans, 380

32. The Bank Circulation, 884

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W A number of the Illustrations in this Volume were executed, under the instructions of Mr. Hereick, at the New York School of Design for Women.

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THE NEW YORK BANKS.