JOURNAL OF BANKING, CURRENCY, AND FINANCE.

THE BOSTON AND NEW YORK STOCK MARKETS.

We have a double purpose in publishing the following communication in this department of the Merchants' Magazine at this time. In the first place we wish to record our high appreciation of the labors of Mr. JOSEPH G. MARTIN, which have been for several years sedulously devoted to the preparation and publication in various forms, correct information pertaining to every description of stocks, in New England, and in the second place renew the suggestions made in our letter to the editor of the Boston Transcript, touching the New York stock market. We are inclined to think, that as the first edition of Mr. Martin's valuable work is nearly exhausted, it would be well for some competent and reliable person in New York, familiar with the operations of the stock market in the last mentioned city, in connection with Mr. Martin, to combine the two works in one volume, which would form a permanent and valuable standard for present and future reference.

THOMPSON, WINDHAM CO., CONN., March 1st, 1856. DEAR SIR-The inclosed slip I cut from the Boston Daily Advertiser. I have for some years taken the Merchant's Magazine, and also the Banker's Magazine, and with pleasure I notice your commendatory remarks respecting Martin's Stock List, &c. Upon their first appearance I addressed a note to Mr. Homans, of the Bankers Magazine, suggesting that a similar publication with Martin's List, for the New York Market, would sell all over the country, and inquired whether he would not undertake to compile one for the profit, that the public interest might be promoted by the reading of it. Cannot you think of some one in New York who would easily compile from the different sources, easily accessible, such a work. Yours respectfully, FREEMAN IIUNT, Esq.

WM. H. CHANDLER.

We give the "slip referred to in Mr. Chandler's letter, as "cut" from the Boston Daily Advertiser :—

"MARTIN'S TWENTY-ONE YEARS IN THE BOSTON STOCK MARKET.-We copy with pleasure, the following testimonial, from Freeman Hunt, Esq., editor of the Merchants' Magazine, in favor of Mr. Martin's valuable History of the Boston Stock Market :

"OFFICE MERCHANTS' MAGAZINE, New York Feb. 6, 1856.

"TO THE EDITOR OF THE TRANSCRIPT:-In a brief notice of the February No. of the Merchants' Magazine, you say, you are glad to observe that Mr. Hunt appears to duly appreciate Mr. Joseph J. Martin's valuable tables of the Boston Stock Market,' &c. I certainly do appreciate them very highly, and regret that a notice I had prepared, expressing my opinion of the value of Mr. Martin's exceedingly useful and interesting tables, was crowded out of the last number of my magazine. I regret that we have no gentleman connected with stock operations in New York, disposed to devote the same degree of fidelity and industry to the preparation of a similar view of the New York Stock Market. The pamphlet of Mr. Martin contains in a nut-shell' a vast amount of useful and interesting matter on all topics falling within its scope. Very truly yours,

FREEMAN HUNT.

"We understand that the cdition is nearly exhausted, and that the work will not be reprinted. Mr. Martin has had some copies bound in a convenient style for preservation, which can be obtained at his office, No. 10 State Street."

CONDITION OF THE BANKS OF KENTUCKY, FROM 1851 TO 1856,

JANUARY 1, 1855.

295,482 2075,092 2,870,574

337,485

213,467

218,106

73,805

10,343,988 8,628,946 4,149,541 4,421,264 12,405,171 16,826,436 8,317,090 2,577,633 2,196,624 343,981

10,404,822 12,634,533 4,610,016 5,312,563 15,638,209 20,950,772 2,541,778 2,555,882 2,522,692 347,955

SOCIETIE GENERALE DE GREDIT MOBILER.

The following account of the "Credit Mobilier," at Paris, is translated from a new Manual of the Funds, published in Paris.

The Societie Generale de Credit Mobilier is a joint-stock company, (societie anonyme,) authorized by decree of Nov. 18th, 1852. Social capital 60,000,000 francs, in 120,000 shares of 500 francs each, entirely paid up, payable to bearer. Offices, 15 Place Vendome, Paris. Duration of the society ninety-nine years from Nov. 18, 1852. Its operations consist :

1. In dealing in all kinds of public securities, and securities of companies, particularly those of railways, canals, mines, and other public works, established or to be established.

2. It may issue its own bonds (ses propres obligations) equal to the amount of the sum employed in purchasing or subscribing for shares.

3. It sells or pledges every kind of share, or bond, or obligation, or exchanges them for others.

4. It offers for all kinds of loans, cedes or sells them, and all kinds of public works.

5. It lends on public funds, on the deposit of shares and other securities, and opens correct credit accounts on the deposit of any of these various obligations. 6. It receives money on accounts current, &c.

7. It undertakes the business of companies, to pay their dividends, and generally does all their business.

8. It takes charge on deposit of all titles to shares in these various enterprises. All other operations are prohibited.

It is expressly understood that it never deals in time bargains. After the complete employment of "social" funds of the company, the obligations created by it may amount to ten times its capital, or six hundred million francs. The aggre gate amount of the deposits received on accounts current, and the obligations created for a less time than a year, are not to exceed the double of the capital realized.

The affairs of the company are administered by a council of fifteen; an executive committee of five administrators executes the decisions of the council. The general meeting takes place in April. It is composed of two hundred largest shareholders. A quorum may be formed by forty members representing the tenth part of the social capital. Each member of the assembly has as many votes as he has multiples of forty shares, but is never to have more than five votes. Every year's accounts are closed on December 31st.

The net profits are thus appropriated :-five per cent as the interest of the capital of the shares subscribed; five per cent on the reserve, which is not to exceed two millions of francs. The surplus belongs, one-tenth to the administrators; nine-tenths to be distributed among the shareholders. The two first years gave the two following results :

Consequently, the shareholders received for the year 1853 interest at five per cent on the capital paid up, besides a dividend of twenty-five francs, or, calcu lating the average of the periods of paying up the capital, 13.40 per cent; and for the year 1854, 25 francs as interest of capital at five per cent, and 34 franca as dividend, say 59 francs, or 11.80 per cent on the capital paid up. The highest and lowest prices of its shares were, in

The high price in 1852 (1,785 francs) was the price of the shares first issued, the owners of which had a right to receive the shares of the second and third issues at par. The advantage of this was estimated at 755 francs, reducing the price deprived of this advantage for comparison with the price at subsequent periods to 1,030 francs. The shares yesterday were 1,570 to 1,585; the day before they were done at 1,540 francs.

The administrators of the company are-Messrs. Isaac Perriere, Chas. Mallet, Adolphe d'Eichthal, Benois Fould, De Aburoa, Ernest Andre, H. Biesta, G. des Arts, Duc de Gulliera, Frederic Grienenger, Comte de Morny, Emilie Periere, Baron Leiller, Casimar Salvador.

Its great peculiarities are found in its undertaking all business of all kinds of companies, especially those to carry on public works, and its making advances on all kinds of shares. New companies are brought out under its auspices, and it is considered a passport to success that it takes up a company.

The London Economist, in view of the very great misapprehension and alarm which prevails, and which has been excited as to the real character of some of the modern banking establishments in Paris-especially that of the CREDIt Mobilier, the CREDIT FONCIER, and the CREDIT MARITIME, thus contrasts them with English Banks:

"These erroneous impressions have been caused mainly by those establishments being, according to the acceptance of the term in this country, erroneously called banks. Banks in England are establishments which have little capital compared to the extent of their obligations. The chief funds with which they trade are composed of deposits, and in case of banks of issue, of notes in circulation. For example, the deposits of the five joint-stock banks in London, amount alone to more than £29,000,000, while their actual capital paid up is only £2,966,332: that is, the capital is equal only to ten per cent of the liabilities for money in deposit with them. And whether the liabilities of such banks consist only of deposits or of deposits and notes in circulation, as a rule the whole are payable on demand. It is therefore obvious that establishments having such enormous obligations payable on demand at any moment, cannot, without being guilty of the greatest imprudence, lock up their means in mortgages, or any other investment of a permanent character, but must confine themselves to securities which can be easily converted at all times, such as exchequer bills, public funds, and in the discount of commercial bills of a moderate date, which are daily falling due, and furnishing the means of paying any demands that may arise. The ruin which spread among our country banks in 1825, was chiefly owing to the neglect of this plain rule; they had largely invested their means in landed securities, and when a run came upon them they had no means of immediately converting them. Many of the Colonial banks have been ruined from a similar cause, viz.: making extensive advances upon plantations and other real property. At last it has become a settled canon in banking, that the only securities which ought to be taken are such as by their nature are at once and at all times marketable and convertible, though it may be at a loss.

When, therefore, we heard of banks with large capitals, and authorized to contract huge obligations for the purpose of making advances upon land for its improvement, upon merchandise abroad and at home, and to lock up their funds in

shares of railways and other joint-stock companies as proprietors, we are naturally disposed to shudder for the censequences of any unusual pressure which might lead to the discredit of such establishments; and this alarm has been increased when we have known that the capital of a single establishment consisted of sixty millions of francs, and that it was empowered to contract obligations by borrowing to the extent of no less than £24,000,000.

"These establishments are, however, in their real character entirely different from English banks, and their obligations are of a nature so essentially opposite, that what English banks could not do, without great danger, these banks may do, not only with impunity but beneficially. In place of trading upon means which are payable on demand like the English banks, these particular establishments in Paris trade only upon capital paid up, and upon money borrowed upon bonds or 'obligations,' which are repayable only over a period of ninety years.

"For example, the Credit Mobilier has a capital of sixty millions of francs, (£2,400,000,) actually paid up. It has the power to issue bonds or obligations to the extent of ten times the capital, or £24,000,000, repayable by means of an annual sinking fund in ninety years, with interest. Such an establishment may be well or ill managed, it may be successful or the reverse, its proprietors may make or lose money, and those who hold the bonds may, in the event of ill success, find that there is not enough to meet their demands finally; but there can be no sudden run or demand made upon it for the repayment of the obligations it has incurred. If it provide for the interest of the bonds and the small annual sinking fund, its obligations are fulfilled, and its creditors at no time can ask more. In point of fact, therefore, unlike those banks which hold deposits and circulate notes, these establishments have nothing to apprehend of inconvenience from any sudden pressure upon the money market. It is plain, therefore, that the same rule does not apply as to the selection of their securities. They may lock up their capital, and borrow money in any description of security or undertaking, provided only it gives a good annual return, so as to enable them to pay their interest, dividend, and sinking fund. In the case, however, of the Credit Mobilier, although the whole of the capital has been paid up, the managers have not as yet exercised their power of issuing obligations to any extent whatever. They recently intended to do so, but in consequence of the pressure upon the money market, they relinquished the design. At present, therefore, they trade only upon their actually paid-up capital.

"Again, the Credit Foncier is of the nature of a land bank, or a land drainage company. It has a capital of thirty millions of francs, (£1,200,000,) of which £600,000 is paid up. The directors have issued bonds or obligations, repayable by a sinking fund in a specified number of years. Their liabilities, also, are not of a nature payable on demand, and therefore they can with safety lend their funds to the landowner and others for permanent improvements, so long as the security is good, and they receive upon the principal of the drainage loans, annual payments equal to the interest and sinking fund.

"It will thus be seen that the establishments of which so much has been said, and about which so much apprehension has been felt, in the event of a panic, are of a character which makes them independent of monetary pressure. No doubt there is a great scope for good or bad management, for losses or for gains. The proprietors may find their shares at a discount or at a premium, as their funds are ill or well invested, and the bondholders may find that they hold good or bad securities, as the money lent is profitably employed or otherwise. All these risks attend those like all other trading concerns, but they are free of the peculiar risk of banks of issue and deposit, which renders it incumbent upon them to limit their investments to securities which are immediately convertible.

"The great danger of such banks as those of the Credit Mobilier and Credit Maritime is, that by embarking large capitals in new undertakings they stimulate speculation unduly, give rise to companies and transactions which the legitimate wants of the country do not require, and thus, although they may not ultimately lose themselves, they are indirectly the cause of great losses to others, and of such an artificial and momentary expansion of trade as to promote monetary and artificial embarrassment; and there can be no doubt that such has been the case to a