Financial History Issue 113 (Spring 2015) - Page 39

From Disagreements to the First Divide continued from page 19 he denounced the “incense” of admiring addresses that greeted the President in every city. He was aware that people were expressing their admiration for “the defender of the liberty of our country” but insisted that it all “favors too much of monarchy to be used by republicans.” Shares in the Bank of the United States went on sale on July 4, 1791, in Philadelphia, New York and Boston. Rumors had convinced not a few people that the government would pay 12% interest. Swarms of investors stormed the Treasury offices in Philadelphia, and 26,200 would-be buyers entered bids. The shares sold out within an hour. To widen participation, Hamilton marketed the $400 shares (about $6,000 in today’s money) piecemeal; a would-be investor could pay only $25 for a document called “scrip” which entitled him to buy a certain number of shares, for which he would have to pay in full in 18 months. For the first month, the price of scrip remained within reasonable bounds. But early in August, it zoomed into the stratosphere. Some people began calling the frenzied market “scrippomania.” One friend warned Hamilt ۈ]H[