"We have supposed a case which may have no parallel in the present day; but it is not without an example. The Ayr Bank, which failed before Adam Smith published his 'Wealth of Nations,' gave an amazing stimulus to the industry of the county of Ayr. The landowner who subscribed £1,000 to the capital of the bank, drew out the same sum in its notes, and five times as much as an advance to his account. Houses were built, plantations made, farms improved, mosses drained, and roads made. The shareholders were like the shepherd boy in the Arcadia. They all piped as though they never should grow old. 'This is a rare life—if it would but last,' said John Knox to the silken-attired, gay, laughing, beautiful ladies of Queen Mary's Court. It was a rare life to the Ayrshire landowners—but it did not last. People began to think that a bank whose shareholders had drawn out a great deal more than they had ever paid in, was not very trustworthy. The holders of notes presented them for payment Down came the bank, having its foundation upon sand, and great was the fall thereof.
"We trust that experience here will not be purchased at so great a price. Enough has already occurred to give rise to a very salutary caution. It has been found that fortunes are not so easily made by the purchases of bank shares as was imagined. Those who have bought at £6 premium and sold at £5. 10s. discount, will hereafter be more careful to look at the character of the directors for knowledge and caution than at the price of shares in the market; actual proprietors, losing one-half of what they supposed they had safely invested, will eschew such further adventures; and those who have received advances, and have had suddenly to repay them, at the risk of total ruin, will hereafter choose rather to plod on in the slow but sure routine of their ordinary business, than venture into wider speculation on the faith of credit at an ill-managed bank."
The following extracts from the Manchester Times may serve to show the unhealthy state of trade in 1837, after a deficient harvest with the continuance of a restricted commercial policy;—January 14th. "The duty on cotton is certainly a very absurd tax, and we are glad to see that a meeting is to be held, to take into consideration the propriety of petitioning for its repeal. There is, however, a tax infinitely more oppressive to our trade—the tax on corn; which not only raises the price here, but shuts us out from markets abroad for the sale of our goods. Why the members of the Chamber of Commerce, with whom
