which were as good as gold, and only required about ten days to be paid in coin by the United States Mint.  I then rode up to Hammond’s house, on Rincon Hill, and found him there.  I explained to him exactly Smiley’s affairs, and only asked him to pay one of his acceptances.  He inquired, “Why not both?” I answered that was so much the better; it would put me under still greater obligations.  He then agreed to meet me at our bank at 10 P.M.  I sent word to others that I demanded them to pay what they could on their paper, and then returned to the bank, to meet Hammond.  In due time, he came down with Palmer (of Palmer, Cook & Co.), and there he met Smiley, who was, of course, very anxious to retire his notes.  We there discussed the matter fully, when Hammond said, “Sherman, give me up my two acceptances, and I will substitute therefor my check of forty thousand dollars,” with “the distinct understanding that, if the money is not needed by you, it shall be returned to me, and the transaction then to remain statu quo.”  To this there was a general assent.  Nisbet handed him his two acceptances, and he handed me his check, signed as collector of the port, on Major J. R. Snyder, United States Treasurer, for forty thousand dollars.  I afterward rode out, that night, to Major Snyder’s house on North Beach, saw him, and he agreed to meet me at 8 a.m. next day, at the United States Mint, and to pay the check, so that I could have the money before the bank opened.  The next morning, as agreed on, we met, and he paid me the check in two sealed bags of gold-coin, each marked twenty thousand dollars, which I had carried to the bank, but never opened them, or even broke the seals.

That morning our bank opened as usual, but there was no appearance of a continuation of the “run;” on the contrary, money began to come back on deposit, so that by night we had a considerable increase, and this went on from day to day, till nearly the old condition of things returned.  After about three days, finding I had no use for the money obtained on Hammond’s check, I took the identical two bags back to the cashier of the Custom-House, and recovered the two acceptances which had been surrendered as described; and Smiley’s two notes were afterward paid in their due course, out of the cash received on those identical acceptances.  But, years afterward, on settling with Hammond for the Custom-House contract when completed, there was a difference, and Smiley sued Lucas, Turner & Co. for money had and received for his benefit, being the identical forty thousand dollars herein explained, but he lost his case.  Hammond, too, was afterward removed from office, and indicted in part for this transaction.  He was tried before the United States Circuit Court, Judge McAlister presiding, for a violation of the sub-Treasury Act, but was acquitted.  Our bank, having thus passed so well through the crisis, took at once a first rank; but these bank failures had caused so many mercantile losses, and had led to such an utter downfall in the value of real estate, that everybody lost more or less money by bad debts, by depreciation of stocks and collaterals, that became unsalable, if not worthless.