his exertions, or the high unimpeachable integrity of his character, that may distinguish him among his fellow citizens; as well on account of the many and continuous demands upon the general funds of a large number of these institutions for mere speculative purposes, that are generally permitted to anticipate their resources, as also, perhaps, from the general character of the population, operating to his prejudice-the extreme hazard and apprehension of eventual loss to these institutions, in conceding a pecuniary indulgence of this kind to parties, of whose real circumstances, as in the instance of four-fifths of the trading community of the United States, there is no possible means of ascertaining; and who, in the case of any accidental failure, or bankruptcy, are encouraged by so many legal opportunities of defrauding creditors, and alike these institutions, of whatever money ad vances they might perchance have made to them.

It is, perhaps, to these circumstances combined, that we may trace the necessity which has to some extent called forth, as a principal auxiliary in the internal trading of America, this numerous class of money brokers, or "shavers," to whom the retail or intermediate dealer is so often compelled to resort, without that he has assumed the only other course, to enable him to carry on his business, assisted by occasional discounts, by ensuring the indorsement on his notes, of some known capitalist, or influential merchant connected with some one of these banking concerns, for which he usually pays

66 SHAVING" ESTABLISHMENTS.

471

him a per centage on the amount, according to the extent or nature of the collateral security he may place in his hands. So often engrossed are the funds-the entire issueable means of these establishments-bespoke in advance of their usual days of discount, by secret negotiation, and for private and selfish uses of this kind, apart from every legitimate trading necessity, that the best and most unexceptionable commercial paper is frequently uncertain of being received by them, when offered in the customary mode of business. mode of business. We have known an instance, and in the year 1836, (when there was scarcely any limit placed to the wild and extravagant increase of bank discounts,) and that we believe to be descriptive of many others of daily repetition that occur, where first-rate paper, and for a limited amount, received in the ordinary course of mercantile dealing, and bearing the indorsement of the most unexceptionable wholesale houses, not only of acknowledged solvency, but of large admitted capital, in short, of the first and most respectable mercantile and shipping firms of the city of New York, with scarcely two months to run out their time, refused to be discounted at eighteen, comprising at the time, nearly the entire of the New York city banks, from the circumstances of the party presenting the notes, being perhaps a stranger, or from a neighbouring or adjoining state, and because there was no other or secondary object to secure, in conceding to him the accommodation, or any other inducement, beyond his mere

personal convenience, and the usual legal interest of 7 per cent, to which the banks of this state were restricted in their discounts. We have afterwards known this party to take the same paper to Wall Street, (the Lombard Street of New York, and usual whereabouts of the money-changers of this city), as his next alternative, and where, though no breath could be raised, or the shadow of a suspicion attach to the security, which was every way unexceptionable and of the highest character, required to pay two per cent per month on the entire sum, for the residue of the time the notes had to run, before reaching maturity, or else, to forego altogether their being discounted.

Public rumour has very often, and we apprehend with some degree of justice, connected many of these "shaving" establishments, in near association with certain of the New York, and other country banks throughout the several states; and where the pressing necessities of the resident citizen, as of the casual stranger, have been taken advantage of, and oftentimes made to yield to the insatiate avarice of the monied vampires, that are to be found in reasonable abundance in this city, as throughout every other intersection of the Republic. The legal premium of 7 per cent, is insufficient to satisfy the craving for inordinate profits of some of these institutions; while the notes of the establishment, the re-issues of former dates are transferred from their counter to some neighbouring money broker's office, conducted in its various ramifications, in the

CONNECTED WITH PUBLIC BANKS.

473 name of some apparently disconnected party, for the better avoidance of public scrutiny, and of concealing the very reprehensible conduct of the banking concern, to which it is allied.

The mode of proceeding in these "shaving" concerns, generally evinces a clear and extraordinary aptitude-a cunning and near calculation in the manner of extorting inordinate gain, from the frequent and unexpected exigencies of the many applicants amidst a large commercial community, for pecuniary accommodation; and will perhaps explain the suddenly accumulated wealth of those, who have neither soul nor conscience to restrain their rapacity, or their habitual oppression, under many exacting and trying circumstances.

Very considerable profits are also amassed by these brokers, in the purchase and sale of uncurrent money, the issues of distant banks at a frequently large discount. These notes are often carried by travellers, or transient persons, to the Atlantic cities, to meet their necessary expenses on the way, and on which they are sometimes compelled to lose, from five, to twenty-five per cent, in afterwards exchanging for local, or current money. But a large proportion of this depreciated currency is actually imported from the interior, or inland states-introduced into the large commercial cities of the seaboard, by the brokers themselves, under a well understood arrangement with the country bank, of whose issues this paper belongs. A large amount of these notes, are from time to time forced into circulation, by means

of the parties who are constrained to seek discounts at these offices, and who are generally required to accept of a certain proportion of these securities, at their nominal, or declared value in payment, as one of the conditions under which they can receive any accommodation whatsoever. After a lapse of some days, and their passing to other hands, probably at a discount, they are again tendered to the broker, who again receives them at a further depreciation, limited only to whatever he may consider to be the necessities of the party, who may now present them to him, to renew the work of plunder by their re-issue, as opportunities may present of doing so.

The loss and inconvenience, as well as the vexation they occasion to the community, is incalculable. But there appears no way of avoiding the difficulty. Should the state of New York, for instance, prohibit their introduction from other states, or proscribe their circulation, these states as a consequent, would immediately retaliate upon New York, and carry on a war of non-intercourse, or of commercial reprisal, that would probably retort with most severity upon the latter state.

Though the law of New York has for several years past interdicted the banks within its jurisdiction, from issuing notes for any lesser amount, or denomination than five dollars, still, are one, and two dollar bills, of the banks of other, especially of the eastern states, in extensive circulation; supplying the stead of a metallic currency, which they have