mere makeshift to meet a financial emergency, and it was not based
upon sound financial principles. It allowed the organization of banks
and the issue of circulating bank notes upon securities that were
capable of being fraudulently overvalued by misrepresentation, and, as a
matter of course, advantage was taken of the laxity of the provisions of
the law, and securities which had no intrinsic value in fact were made
available as the foundation of bank issues, with the inevitable result
of disaster.

Another method of furnishing the community with a circulating medium was
resorted to by a law of July 23, 1858. The state auditor was authorized
to issue his warrants for any indebtedness which the state owed to any
person in small sums, and the warrants were made to resemble bank notes,
and bore twelve per cent interest. The credit of the state was not
sufficiently well established in the public confidence to make these
warrants, which were known as "state scrip," worth much over sixty-five
or seventy cents on the dollar. They were taken by the money changers at
that valuation, and when the state made its first loan of $250,000, they
were all redeemed in gold at par, with interest at twelve per cent.

In this uncertain way, the financial interests of the territory were
cared for until the breaking out of the Civil War, and the establishment
of the national and state systems which still exist.

Another evidence of the growth of the state may be found in the fact
that at the present time the state has within its limits banks in good
standing as follows: State banks, 172 in number, with a paid-in capital
stock of $6,736,800, and sixty-seven national banks, with a capital
stock paid in of $11,220,000. This statement does not include either the
surplus or the undivided profits of these banks, nor the capital
employed by private banking concerns which do not fall under the
supervision of the state, which latter item can safely be estimated at
$2,000,000.

THE FUR TRADE.

The first legitimate business of the territory was the fur trade, and
the carrying business resulting therefrom. Prior to the year 1842 the
Northwestern Fur Company occupied the territory which is now Minnesota.
In 1842 it sold out to, and was merged into, the American Fur Company,
which was owned by P. Choteau & Company. This company had trading
stations at Prairie du Chien and Mendota, Henry H. Sibley being their
chief factor at the latter. The go