it as his opinion "that the
banks of Pennsylvania were in a much sounder state than before the
suspension, and that the resumption of specie payments, so far as it
depends on their situation and resources, may take place at any time."

On February 28, 1838, Mr. Gallatin's committee made a further report
showing that the liabilities of the New York banks had been reduced more
than twelve millions and a half, or fifty per cent., and asserting that
with the support of the community and the state authorities they could
resume on an equal footing on May 10. This declaration was welcomed with
great satisfaction by a general meeting of the citizens of New York. On
April 11 the general convention again met in New York. The Philadelphia
banks declined to attend. A letter from Mr. Woodbury promised the
support of the Treasury Department. A committee of one from each State
was appointed, which recommended the first Monday in October as the
earliest day for a general resumption. The convention could not,
however, be brought to fix upon so early a day, but finally fixed upon
January 1, 1839, and adjourned. The New York banks would have accepted
July 1, 1838, but this being refused they resumed alone on May 10, and
the force of public opinion compelled resumption by nearly all the banks
of the country on July 1.

The terrible contraction was fatal to the United States Bank of
Pennsylvania, which after a vain struggle closed its doors in October,
1839, and carried with it the entire banking system of the Southern and
Southwestern States. Although in no way similar to the semi-governmental
institutions which preceded it, yet, from its similarity of name and
identity of location, its disastrous failure added to the blind popular
distrust of its predecessors, which narrow-minded politicians had
fostered for their own selfish purposes. Fortunately the sub-treasury
plan of Mr. Woodbury supplied the need of a safe place of deposit which,
since the refusal of Congress to renew the charter of the old bank, had
been sorely felt.

In 1838, on the foundation of the Bank of Commerce under the free
banking law of the State of New York, the presidency of it was first
tendered to Mr. Gallatin. The directors of this bank were among the most
distinguished financiers of the city, and its object was to provide a
conservative institution with sufficient power and capital to act as a
regulator upon the New York banks. Profit to the stockholders was
se