The collapse of the entire fabric of finance led to the establishment of the Bank of North America, the notes of which were redeemable and redeemed at the bank counters. The article in the Constitution of 1787, prohibiting the issue of bills of credit by the States, was evidently intended to secure a uniform currency to the people of the United States, and it has been by a strange perversion of this manifest intention that the power has been conceded to the States to charter corporations to do that which was forbidden to themselves in their sovereign capacity; namely, to issue bills of credit, which bank-notes are. It is idle to say that, because such bills were not a "legal tender," they were therefore not of the character which the Constitution forbade. Necessity knows no law, and in the absence of any other currency the people were perforce compelled to take what they could get. Experience later showed that large amounts of paper money manufactured in one State were easily put in circulation in far distant communities, and considerable sums, through the operations of wear and tear and the vicissitudes incident to its fragile nature, never returned to plague the inventor. At the time of the organization of the National Bank by Hamilton, there were but three banks in the United States: the Bank of North America, the Bank of New York, and the Bank of Massachusetts. Their added capital amounted to two millions of dollars, and their issues were inconsiderable. Mr. Gallatin estimated that in January, 1811, just before the expiration of the bank charter, there were in the United States eighty-eight state banks with a capital of $42,612,000. --------------------------+-------------+---------------+------------ | | Notes in | | Capital. | Circulation. | Specie. --------------------------+-------------+---------------+------------ Bank of the United States | $10,000,000 | $5,400,000 | $5,800,000 Eighty-eight State Banks | 42,610,601 | 22,700,000 | 9,600,000 --------------------------+-------------+---------------+------------ | $52,610,601 | $28,100,000 | $15,400,000 --------------------------+-------------+---------------+------------