s last report: 'It
was only when the United States notes, having been made a legal tender,
were diverted from their legitimate use as a currency, and made the
basis of bank circulation, that the great increase of the latter began.'
At the present depreciation of these treasury notes, it is better for
the banks, by one third, to redeem their circulation in these notes,
rather than in specie; and they need keep only one dollar of treasury
notes for three of bank circulation. This is the policy forced upon the
banks by Congress. But the more redundant and depreciated this currency
becomes, the easier will it be for the banks to provide the basis of
redemption, and expand their circulation in the ratio, like that of
specie, of three dollars of bank currency for each dollar of treasury
notes held by them. Thus it is that the enlarged issue of treasury notes
necessarily increases the bank circulation, in the ratio of three to
one, and thus also, that the circulation of bank and treasury notes
becomes redundant and depreciated. Under such a policy, every bank then,
however loyal its stockholders or officers, becomes a citadel, whose
artillery bears with more fearful effect upon the Government than all
the armies of the rebellion. This will soon become obvious, and the
odium will rest upon the banks, their officers and stockholders. But the
real responsibility will be with Congress, who, by such a system will
have arrayed the banks in necessary and inevitable hostility to the
Government. Such, we all know, is not the intention of Congress; but as
this result will necessarily flow from their measures, upon them, in the
end, will fall the terrible responsibility of the disaster. It is this
appalling condition of our finances that gives the rebellion its only
hope of success, and invites foreign intervention. But if Congress will
adopt the policy of the Secretary, they will render certain the triumph
of the Union, and the rebels, from despair and exhaustion, must soon
abandon the contest.

We have seen how dreadful is the disaster which the banks would bring on
the country by pursuing the present system, and how terrible the odium
to which they would be subjected. But now let us look at the result, if
the plan of the Secretary is adopted. The new banks would become fiscal
agents of the Government. Their circulation would be uniform, furnished
by the Government, and based on U. S. stocks, the principal and interest
of which would b