ssion from one
place to another. But this may be mainly supplied by bills of exchange,
so as to prevent any great displacement of actual coin. Two places
trading together balance their dealings, for the most part, by their
mutual supplies, and the debtor individuals of either may, instead of
cash, remit the bills of those who are creditors in the same dealings;
or may obtain them through some third place with which both have
dealings. The cases would be rare where such bills could not be
obtained, either directly or circuitously, and too unimportant to the
nation to overweigh the train of evils flowing from paper circulation.

From eight to thirty-five millions then being our proper circulation,
and two hundred millions the actual one, the memorial proposes to issue
ninety millions more, because, it says, a great scarcity of money is
proved by the numerous applications for banks; to wit, New York for
eighteen millions, Pennsylvania ten millions, &c. The answer to this
shall be quoted, from Adam Smith (B. 2, c. 2, page 462), where speaking
of the complaints of the traders against the Scotch bankers, who had
already gone too far in their issues of paper, he says, 'Those traders
and other undertakers having got so much assistance from banks, wished
to get still more. The banks, they seem to have thought, could extend
their credits to whatever sum might be wanted, without incurring any
other expense besides that of a few reams of paper. They complained
of the contracted views and dastardly spirit of the directors of those
banks, which did not, they said, extend their credits in proportion to
the extension of the trade of the country; meaning, no doubt, by the
extension of that trade, the extension of their own projects beyond what
they could carry on, either with their own capital, or with what they
had credit to borrow of private people in the usual way of bond or
mortgage. The banks, they seem to have thought, were in honor bound to
supply the deficiency, and to provide them with all the capital
which they wanted to trade with.' And again (page 470): 'When bankers
discovered that certain projectors were trading, not with any capital
of their own, but with that which they advanced them, they endeavored
to withdraw gradually, making every day greater and greater difficulties
about discounting. These difficulties alarmed and enraged in the highest
degree those projectors. Their own distress, of which this prudent and
necessa