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133.: From DAVID HUME - Adam Smith, Glasgow Edition of the Works and Correspondence Vol. 6 Correspondence of Adam Smith [1740]

Edition used:

Correspondence of Adam Smith, ed. E. C. Mossner and I. S. Ross, vol. VI of the Glasgow Edition of the Works and Correspondence of Adam Smith (Indianapolis: Liberty Fund, 1987).

Part of: The Glasgow Edition of the Works and Correspondence of Adam Smith, 7 vols.

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


133.

From DAVID HUME

MS., RSE ii. 49; HL ii. 265–6.

[Oct. 1772]

My dear Sir

Yours came to hand, while I was in the Country1 where I should have been still, had it not been for a Letter of the French Ambassador, who expected to see me here in Town: He is lookd for to morrow Evening. As soon as I came to Town, I ask’d the Question you proposd; and was told by Sir William Forbes,2 that tho’ they did not commonly take the Air Notes,3 yet he woud upon your Account: You may therefore send them over by the first Opportunity. I think that Bank more discredited by the last Step than by all their former Operations. They pretend to open at Air, in order to have a Pretence for striking off any farther Interest but as soon as great Sums are demanded, they pretend, that they are only to change small Notes for the Circulation of the Country; and so refuse Payment: This is in effect shutting up again: They do not seem to have forseen, that it was the Interest of the two Banks here and of all the Bankers to make a Run upon them; for which they ought to have been prepar’d. As far as I can learn, the Duke of Queensberry4 alone signs the Bonds of Annuity in his own Name; but it is imagind that the Duke of Buccleugh, Mr Douglas5 etc., have enterd into an Agreement to bear their Share: Otherwise it were Madness in him; and indeed not very wise in him and them in any case. I had last post a Letter from Andrew Stuart: I do not like the present Situation of that Supervisorship. Six to go from Europe, three to join them in the Indies: Corruption will get in among them; and probably Absurdity and Folly. And at best nine Persons can never do any Business. He tells me, that Ferguson is sure of going out Secretary.6 I wish it may be so. It will be a great Vexation and Disappointment to him to return to his Office with which he was before somewhat disgusted.

Yours

D H

[1 ]Hume visited Ninewells and Minto in the autumn of 1772, then hurried back to Edinburgh hearing that the French Ambassador, the duc de Guines (1735–1806), was expected there.

[2 ]Sir William Forbes (1739–1806), Edinburgh banker; apprenticed to Messrs. Coutts, 1753; partner, 1761; formed Messrs. Forbes, Hunter & Herries, 1763, which became Forbes, Hunter & Co. 1773, wrote a Life of James Beattie (1806).

[3 ]See Letter 131 from Hume, dated 27 June 1772. The directors reopened their head office in Ayr on 28 September 1772, seeking to exchange notes for specie, but they were finally forced to give up business in August 1773.

[4 ]Charles, 3rd Duke of Queensberry, owned extensive property in the Lowlands and was a distinguished agricultural improver. Already Chairman of the Forth and Clyde Canal Company, he was elected Chairman of the Ayr Bank in 1769. After the crash of June 1772, the directors proceeded to raise money in London by means of terminable annuities at an extremely high rate.

[5 ]Archibald Douglas of the Douglas Cause: he and Queensberry and the other partners of the Ayr Bank were liable to the full extent of their wealth. Ultimately the creditors were paid in full at a cost of £663,397, and it is said that £750,000 worth of landed property had to be sold.

[6 ]In Feb. 1772 Hume heard that Andrew Stuart was to be appointed as one of the supervisors to inquire into the affairs of the East India Company. Adam Ferguson’s name was mentioned for the post of secretary to the commission, but neither he nor Stuart was appointed; see Letter 132 addressed to Sir William Pulteney, dated 3 Sept. 1772.