Volume 2 - ElectricCanadian.com

108 HISTORY OF THE BANKconjunction with the silver agitation 1made it very difficult tolend surplus monies profitably, the Chicago agency was closed.At home, agencies were opened at Jarvis and Blenheim, thelatter being placed in charge of the Chatham manager.The firstJoan Inglis,woman to enter the service of the bank, Misswas appointed to the staff of the head office in1The silver agitation in the United States may be regarded as part of the aftermathof the Civil War, and of the depreciation of the paper currency issued by the Government.to three causes:It arose out of the fall in the value of silver, after 1873, which was due mainly1. The discovery of new silver mines of extraordinary richness in the State ofNevada and the consequent remarkable increase in the annual world production ofsilver, which doubled in a few years.2. The substitution by Germany after the Franco-Prussian War, of an Imperialgold currency for the silver coinages of the various German states, and thewithdrawal from circulation, and sale as bullion, of much of the latter. Thisoperation was facilitated by the indemnity paid by France.3. The cessation of railway building on a large scale in India, which checkedthe demand from that country for silver. When this took place, not only wasthe indebtedness of the Indian Government in Great Britain increased by theinterest payable on the outlays for these railways, but that Government wasdeprived of the funds in Great Britain representing the proceeds of the largeloans raised there for railway-construction purposes. As a result it was forcedto offer for sale in London much larger quantities of Council bills than formerly,and these served as remittances to India instead of silver.In 1873 the silver dollar had been dropped from the list of coins struck by theUnited States, and the owners of silver mines in that country and their politicalbackers sought to have the unlimited coinage of silver made legal. The chief concernof the mine-owners was to create a market for the rapid increase in their product,while the desire of the politicians was more for continued inflation of the currency.In 1878 an Act was passed compelling the United States Government to purchasea limited amount of silver annually and to coin it into silver dollars. Under this Actbetween 1878 and 1890 the Government paid out $308,000,000 for silver bullion. In1890, by another Act, the annual amount of silver bullion which the Government wasobliged to purchase was increased, and payment had to be made in legal tendertreasury notes. This inflation of the currency in a time of peace led to large exportsof gold, and doubt as to the ability of the Government to maintain payments in goldgradually became general. Under these circumstances foreign institutions such asThe Canadian Bank of Commerce naturally became anxious to reduce the amount oftheir risks in the United States. The inevitable consequences of this fatuous finpolicy were postponed for a time, owing to a concurrent reduction in the NationalBank currency and to the coincidence of large crops in the United States with poorcrops in Europe, but in 1893 there occurred the anticipated financial panic, followed byand prolonged commercial crisis.