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Hamilton LS to Bank of New York Advising That Collectors Will No Longer Receive Its Notes |
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Secretary of the Treasury Alexander Hamilton informs President Gulian Verplanck (1751-1799) and the directors of the Bank of New York, an institution he helped to found in 1784, that collectors of three New York and New Jersey ports would no longer receive their bank’s notes in exchange for specie. Those port collectors were John Lamb (1735-1800) of New York City; Henry Packer Dering (1763-1822) of Sag Harbor, on Long Island, New York; and John Halstead (1729-1813) of Perth Amboy, New Jersey.
ALEXANDER HAMILTON.
Manuscript Letter Signed, to President Gulian Verplanck and Directors of the Bank of New York, April 15, 1793, [Philadelphia, Pennsylvania]. 1 p., 7¼ x 8⅞ in.
Inventory #27438
Price: $19,000
Complete Transcript
Treasury Department April 15th 1793
Gentlemen
The Collectors of New York, Sag-Harbour and Perth Amboy having been instructed to discontinue after the 1st of June next, to receive, and exchange for specie, the cash notes and Post notes of the Bank of New York, I have thought it proper to communicate this arrangement for your information.
With respectful consideration
I have the honor to be
Gentlemen / Your Obedt Servt
Alexander Hamilton
The President Directors & Co
of the Bank of New York
Historical Background
When Hamilton became Secretary of the Treasury in September 1789, he obtained short-term loans to conduct the federal government from two of the nation’s largest banks—the Bank of New York and the Bank of North America. In part to service these loans and also to control the amount of gold and silver coin (“specie”) available for use by the government, Hamilton occasionally ordered the collectors of duties at the nation’s ports to accept as payment the notes issued by these and other state banks. The Treasury then took the collectors’ notes to the same banks and received specie in exchange.
After helping to bring the financial crisis of 1792 under control, Secretary Hamilton informed the collectors to stop accepting notes from the Bank of New York as of June 1, 1793. Through this brief letter, he informed the president and directors of the Bank of New York of his decision. This decision allowed the Bank of the United States to play a larger role in the national economy and provide an increasingly stable national currency. Congress had authorized the first Bank of the United States in February 1791, and the bank began operating later that year in Philadelphia. Although it did have branches in multiple states and could lend money to the federal government, it did not set monetary policy or regulate private banks.
Hamilton was one of the original organizers of the Bank of New York and served as one of its directors from 1784 to 1788.
Condition
Small tear at left edge repaired with cellophane tape on verso; expected folds.
