Proceedings of the legislature of Massachusetts.... Intrigues of the French among the Indians.... War with the savages.... Peace.... Controversy with the governor.... Decided in England.... Contests concerning the governor's salary.... The assembly adjourned to Salem.... Contest concerning the salary terminated.... Great depreciation of the paper currency.... Scheme of a land bank.... Company dissolved by act of Parliament.... Governor Shirley arrives.... Review of transactions in New York. {1714} The heavy expenses of Massachusetts during the late war had produced such large emissions of paper money, that a considerable depreciation took place, and specie disappeared. The consequent rise of exchange, instead of being attributed to its true cause, was ascribed to the decay of trade. The colony, having now leisure for its domestic concerns, turned its attention to this interesting subject. [Sidenote: Affairs of Massachusetts.] Three parties were formed. The first, a small one, actuated by the principle that "honesty is the best policy," was in favour of calling in the paper money, and relying on the industry of the people, to replace it with a circulating medium of greater stability. The second proposed a private bank, which was to issue bills of credit, to be received by all the members of the company, but at no certain value compared with gold and silver. It was not intended to deposit specie in the bank for the redemption of its notes as they might be offered; but to pledge real estates as security that the company would perform its engagements. The third party was in favour of a loan of bills from the government, to any of the inhabitants who would mortgage real estate to secure their re-payment in a specified term of years; the interest to be paid annually, and applied to the support of government. The first party, perceiving its numerical weakness, joined the third; and the whole province was divided between a public and private bank. At length, the party for the public bank prevailed in the general court, and fifty thousand pounds were issued and placed in the hands of trustees; to be lent for five years, at an interest of five _per centum per annum_, one-fifth part of the principal to be paid annually. {1716}