From William Seton1
[New York] 6 Feby 1792
My dear Sir
I have delayed answering your very kind Letter of the 24th till I could have a more ⟨detailed⟩ knowledge of what was going on. Col Duer tells me he has however written you2 in the mean while. Every Interest is rushing by the phalanx of opposition with our Legislature to grant them a Charter3—and it is impossible yet to judge whether they will carry their point or not. The Committee have reported that the prayer of the Petition ought to be granted.4 Our friends are preparing a Counter Petition to the House, & mean to propose to borrow from the State on Interest all the money they have which will be 1½ Millions.5 Could we bring them to consent to this, it would effectually prevent their giving the Charter to the others—however should all our efforts be in vain & this heterogeneous mass get into Motion—it will then be more essentially necessary that the Bank of the U S. & this Institution be upon the most confidential footing—for unless we unite against this Host, the 36 acting & operating & at varience might produce a general bankruptcy. From appearance the Bank will soon get into operation here. Coallition or not, it is of the utmost consequence that we should draw together in every point— otherwise their Speculation will play upon us both, & may drain us of every shilling of Specie. From what I can observe of their intentions, they are aiming at an accumulation of large deposits in the Bank—which we must check by not allowing them any discounts—& watch the funds of payments they have to make to us. I feel the highest satisfaction in being permited to be confidential with you on these subjects, I shall therefore open everything to your advice, and I must candidly say that unless our Directors will act with decided firmness and that we receive from you every possible support, when their Bank is to be set agoing, the consequences may be fatal to us. The Balance on ⟨–⟩ the Bank of the U. S. is 176453—this sum no doubt they will depend upon to receive in Specie—& can do us no harm—but if the balance due the Treasurer of 232,000 was to be drawn for & exported in Specie also—together with the opposition balance that will absolutely be drawn from us—then it would become scarce—& would oblige us to send to Phila. the National Notes we have for exchange in Specie. We have now 230,000 Dolls. of them, & this week & the next the last Amsterdam Bills will be paid for, probably all in that Paper as they amount to 205,000 Dolls more. The fact is we have actually in Specie in the Vaults better than 600,000 Dollars & the balance due us on Discounted Bills is 2,500,000 Doll’s—which is full double the amt of all we owe on Deposits. Our Circulating Notes is a trifle only—yet if our Deposits are called for, more suddenly than we can call in our Discounts much temporary Distress must ensue. It is therefore of great consequence to us as well as to the Bank of the US. that the paper we have of theirs should be set against what we owe them & the Public—that neither may be forced to an ⟨interchange⟩ of Specie.
ADf, Bank of New York, New York City.
1. Seton was cashier of the Bank of New York.
2. Letter not found. William Duer had resigned as Assistant to the Secretary of the Treasury in April, 1790, to return to private business. He soon became one of New York’s biggest and most flamboyant speculators.
3. This is a reference to the efforts of various groups in New York City to obtain a charter for a new bank. See H to Seton, January 18, 24, 1792; Seton to H, January 22, 1792; and Philip Schuyler to H, January 29, 1792.
4. On February 4, 1792, “Mr. [Nathaniel] Lawrence [of Queens County], from the committee to whom were referred sundry petitions, praying for the incorporation of a bank, by the name and stile of the President, Directors and company of the State Bank, reported … That the committee are in possession of the draft of a bill, which fully delineates the objects of the petitioners; and contains also certain propositions for opening canals, and effecting that internal navigation which is at present contemplated as so highly interesting to the prosperity of the State.…” The bill was introduced and read the first time (New York Assembly Journal, 1792 description begins Journal of the Assembly of the State of New York. Fifteenth Session (New York, 1792). description ends , 49).
5. On February 9, 1792, the president and directors of the Bank of New York resolved that “… if the legislature of the State of New-York shall think proper to authorize their Treasurer, to place upon loan to individuals and bodies corporate any of the money belonging to the State the directors … agree … to allow therefor such interest as the State may require, not exceeding six per centum per annum …” (New York Assembly Journal, 1792 description begins Journal of the Assembly of the State of New York. Fifteenth Session (New York, 1792). description ends , 64).
6. Seton is referring to the New York branch of the Bank of the United States, the Bank of New York, and the proposed “Million Bank.”