To the existence of banks of _discount_ for _cash_, as on the continent of Europe, there can be no objection, because there can be no danger of abuse, and they are a convenience both to merchants and individuals. I think they should even be encouraged, by allowing them a larger than legal interest on short discounts, and tapering thence, in proportion as the term of discount is lengthened, down to legal interest on those of a year or more. Even banks of _deposit_, where cash should be lodged, and a paper acknowledgment taken out as its representative, entitled to a return of the cash on demand, would be convenient for remittances, travelling persons, &c. But, liable as its cash would be to be pilfered and robbed, and its paper to be fraudulently re-issued, or issued without deposit, it would require skilful and strict regulation. This would differ from the bank of Amsterdam, in the circumstance that the cash could be redeemed on returning the note.
When I commenced this letter to you, my dear Sir, on Mr. Law's memorial, I expected a short one would have answered that. But as I advanced, the subject branched itself before me into so many collateral questions, that even the rapid views I have taken of each have swelled the volume of my letter beyond my expectations, and, I fear, beyond your patience. Yet on a revisal of it, I find no part which has not so much bearing on the subject as to be worth merely the time of perusal. I leave it then as it is; and will add only the assurances of my constant and affectionate esteem and respect.
[6] The real cash or money necessary to carry on the circulation and barter of a State, is nearly one-third part of all the annual rents of the proprietors of the said State; that is, one-ninth of the whole produce of the land. Sir William Petty supposes one-tenth part of the value of the whole produce sufficient. Postlethwait, voce, Cash.
[7] Within five months after this, they were compelled by the necessities of the war, to abandon the idea of emitting only an adequate circulation, and to make those necessities the sole measure of their emissions.
DEAR SIR,--Your favor of October 18th has been duly received, and I learn with great pleasure the progress you have made towards an establishment on Columbia river. I view it as the germ of a great, free and independent empire on that side of our continent, and that liberty and self-government spreading from that as well as this side, will ensure their complete establishment over the whole. It must be still more gratifying to yourself to foresee that your name will be handed down with that of Columbus and Raleigh, as the father of the establishment and founder of such an empire. It would be an afflicting thing indeed, should the English be able to break up the settlement. Their bigotry to the bastard liberty of their own country, and habitual hostility to every degree of freedom in any other, will induce the attempt; they would not lose the sale of a bale of furs for the freedom of the whole world. But I hope your party will be able to maintain themselves. If they have assiduously cultivated the interests and affections of the natives, these will enable them to defend themselves against the English, and furnish them an asylum even if their fort be lost. I hope, and have no doubt our government will do for its success whatever they have power to do, and especially that at the negotiations for peace, they will provide, by convention with the English, for the safety and independence of that country, and an acknowledgment of our right of patronizing them in all cases of injury from foreign nations. But no patronage or protection from this quarter can secure the settlement if it does not cherish the affections of the natives and make it their interest to uphold it. While you are doing so much for future generations of men, I sincerely wish you may find a present account in the just profits you are entitled to expect from the enterprise. I will ask of the President permission to read Mr. Stuart's journal. With fervent wishes for a happy issue to this great undertaking, which promises to form a remarkable epoch in the history of mankind, I tender you the assurance of my great esteem and respect.