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 possession of the public mind. It was regarded as a good thing to have, but too good to use. A specie dollar was regarded as an excuse for its owner to print and circulate from three to twenty paper ones, but it was not regarded as having any other use. The withdrawal of the specie basis from an inflated paper was no doubt a serious blow to the whole fabric, but, if the paper had not been redundant the transfer of specie to the West could only have forced an importation of so much more. This superstition about specie also prevented any demand upon the banks for specie for any purpose. Such a demand was regarded as a kind of social or business crime. Hence the "convertibility" of the notes was a polite fiction. The second point worth noticing is that the bank advocates continually talked about "the credit system" when they meant the system of issuing credit bank notes; and they grew eloquent about the advantages of credit, as if those advantages could only be won by using worthless bank notes and not by lending gold or silver or capital in any form.

We are not yet, however, at the end of the political acts which threw the money market into convulsions. The opposition succeeded, in the summer of the presidential election year, 1836, in passing an act to deposit with the states the surplus over a balance of five millions in the Treasury on January 1, 1837. The amount was thirty-seven millions. This sum was scattered in eighty-nine deposit banks all over the country. Its distribution was, therefore, controlled by local pressure and political favoritism, not by the needs of the government (for it did not need the money at all) or by the demand and supply of capital. The banks had regarded it as a permanent deposit and had loaned it in aid of the various public and private enterprises which were being pushed on every hand at such a rate that labor was said to be drawn away from agriculture so that the country was importing bread stuffs. It was now to be