In an Unpublished Letter, Secretary of War and State James Monroe Laments the State of the Banks in 1815 and the Lack of a Stable “Circulating medium”

James Monroe was appointed by President James Madison as Secretary of State on April 2, 1811. Monroe assumed duty a few days later, and served in that post until March 3, 1817. From October 1, 1814, to February 28, 1815, he was also ad interim Secretary of State, during which time he served in both positions. He remains the only person to hold the offices of Secretary of State and of War at the same time.

The charter for the First Bank of the United States expired in 1811. Despite broad support for reestablishing a national bank, the road to re-creation was not smooth. In January 1814, Congress received a petition signed by 150 businessmen from New York City, urging the legislative body to create a second national bank. In February, and again in November, Calhoun put forth plans to create a bank that would be headquartered in the District of Columbia, but his bills did not pass.

In April 1814, President James Madison, who had opposed the creation of the first Bank of the United States in 1791, reluctantly admitted to the need for another national bank. He believed a bank was necessary to finance the war with Britain. But later that year, progress in peace negotiations led Madison to withdraw his support for the proposed national bank.

After peace with Britain came in 1815, Congress rejected new efforts to create the bank. In the months that followed, however, the federal government’s financial position deteriorated amid a broader economic downturn. Many state-chartered banks had stopped redeeming their notes, which convinced Madison and his advisers that the time had come to move the country toward a more uniform, stable paper currency.

Early January 1815 was a momentous and busy time for Monroe, serving as Secretary of State and War. January 8, the day this letter was written, Andrew Jackson engaged in the Battle of New Orleans, perhaps the most famous battle of the entire war.

Autograph letter signed, Washington, January 8. 1815, apologizing for the state of the banks as it pertains to what is almost certainly a personal banking or acquisition matter. “I have just received your letter of the 5th. The state of the banks in curtailing etc and of the circulating medium making a loss in a remittance form this place to Richmond subject me much inconvenience. I have nevertheless five hundred dollars subject to your orders. Perhaps you may be able to draw on me, on short notice, for that sum, without loss. If you can, or can with a small loss which I will pay, you may draw on the receipt of this. If you cannot draw, thus favorably inform me, and I will immediately place for you five hundred dollars in Richmond, of which you shall be advised, provided that will suit you. I have the money in notes of this district remained for this purpose. I will I doubt not pay the balance at 60 days from the 1st of this month, which I hope will suit you.”

As is common with letters of Monroe, there is no recipient on the verso.