To William Seton
April 4th 1792
My Dear Sir
The post of this day brought me a letter from you.1 I am pained, beyond expression, at the picture you and others give me of the situation of my fellow Citizens—especially as an ignorance of the extent of the disorder renders it impossible to judge whether any adequate remedy can be applied.2
You may apply another 50 000 Dollars to purchases at such time as you judge it can be rendered most useful.3 The prices may be 20/ for 6 per Cents 12 for three’s and 12/6 for deferred. The law4 & the object require that it should be known you purchase for the public. I shall by the next post send an Official authorisation.
I have doubt however whether it will be best to apply this immediately or wait the happening of the crisis which I fear is inevitable. If as is represented a pretty extensive explosion is to take place—the depression of the funds at such a moment will be in the extreme and then it may be more important than now to enter the market in force. I can in such case without difficulty add a hundred thousand Dollars probably a larger Sum. But you who are on the spot being best able to calculate consequences I leave the proper moment of operating to your judgment. To relieve the distressed and to support the funds are primary objects.
As it may possibly become adviseable for the Bank to receive payments in Stock from embarrassed persons, it may not be amiss that you should know as a guide That there are at this moment orders from a respectable Dutch concern to purchase 6 Cents at 24/ if bills can be sold at par. Of this I have the most unequivocal evidence. This is a proof that foreigners will be willing to give that price.
I presume your greatest embarrassments arise from the contracts to pay and deliver not yet at issue. Is it possible to form any conjecture of their extent?
P. S. I will thank you for a memorandum, in confidence, of how much remains unexpended in Bank of the sums which have been passed to the Credit of the Commissioner of Loans5 at different times,
William Seton Esqr.
ALS, Bank of New York, New York City; copy, in the writing of Seton, Hamilton Papers, Library of Congress.
1. Letter not found.
2. This sentence refers to the financial crisis in New York City in the spring of 1792. See William Duer to H, March 12, 1792; H to Duer, March 14, 23, 1792; Philip Livingston to H, March 24, 1792; H to Livingston, April 2, 1792; Philip Schuyler to H, March 25, 1792; Robert Troup to H, March 19, 1792.
3. H previously had authorized Seton to “purchase on account of the United States at par to the extent of Fifty thousand Dollars” (H to Seton, March 25, 1792). For authorization of further purchases of Government securities, see “Meeting of the Commissioners of the Sinking Fund,” April 4, 1792.
4. A proviso regarding sinking fund purchases in Section 2 of “An Act making Provision for the Reduction of the Public Debt” reads as follows: “Provided, That the same be made openly, and with due regard to the equal benefit of the several states” (1 Stat. 186 [August 12, 1790]).
5. John Cochran was commissioner of loans at New York.