To Bank or Not to Bank: Edward Smith Hall on Free Trade and the Commodification of Money in Early New South Wales

Abstract

The establishment of a uniform and widely accepted currency in New South Wales took many years and many attempts. From the infamous use of rum as currency, to the introduction of the famous 'holey' dollar and the widespread use of promissory notes, the topic of money caused much controversy and much conversation in the new colony. This article examines the issue through the eyes of Edward Smith Hall, a man who had much to say about many aspects of life in New South Wales and who published his thoughts regularly in the <i>Sydney Monitor</i>, a newspaper he edited from 1826 until 1840. In the case of the currency debates, Hall spoke from personal experience, as he had a background in accountancy and banking. His ruminations on the subject reveal a man caught between wishing to uphold the traditional, paternal ways of old England but also wanting to adopt the new doctrines of political economy and <i>laissez-faire</i>. On the one hand, Hall can be seen as still subscribing to the notion of moral economy, the system of mutual obligation by which both the 'common people' and their 'masters' recognised that direct dealings between them involved adherence by both parties to long-established customs and traditions. On the other hand, Hall also accepted the rise of the 'middle-men' (traders, merchants and the like) who came between the two groups and, he believed, contributed to the healthy functioning of the natural regulatory forces of the marketplace, the central tenet of political economy.² The ways in which Hall embraced both of these concepts often led him to adopt confusing and at times contradictory stances on all manner of points, money included. As will be seen, Hall's comments regarding usury and paper money seem to be at odds with his involvement in banking; however, they are consistent with the outlook of a man concerned with the rights of the poor and oppressed.