5. The Bank
        on Main and Railroad

Inflation is something we got accustomed to during the 20th Century. College textbooks even referred to the phenomenon as a good thing. During the 19th Century, however, people did not take inflation for granted. A pair of boots cost about the same in 1830 as it did in 1890. It is only at about the time Sherwood is incorporated in 1893 that prices start to rise all around the world, for reasons that are as mysterious and debatable now as they were then. Our Town Council refused to accept the new paradigm. In one meeting alone, a bill of Mr. Chapman "...for iron work on Jail amount $6.25 was cut down to $4.05... F.M.Buyer's Bill for $5.25 was cut down to $4.50.... Bill of A.E.Beach and Co. for shingles $15.60 was called up and on Motion of Smock was laid over until next meeting and [Councilor] Eyman was instructed to see Mr.Beach in regard to the same." We can be certain that these ex parte visits often turned into shouting matches, yet there is no record of any contractor suing the city for full payment. It is easy to imagine the public supporting the town fathers rather than the business community in the battle against inflation.

The buildings on the street across from the Carlson and Sherk building survived all of Sherwood's Great Fires, as did all other structures on that block, though the bank building has been altered dramatically. After the Citizens Bank of Sherwood was established on the corner of Washington and Railroad, Gustave Hanke's shoe shop occupied this building.

The Town of Sherwood was armed with yet another weapon against the woes of the national economy. 1893 Oregon Senate Bill 36 (The Town of Sherwood Charter) authorized the Town to lend money. There is not enough information to explain why Town Hall would double as a lending agency. We can only report with certainty that Old Sherwood Town's experiment ended in failure when a number of prominent citizens couldn't repay their loans on time.

According to economists today, something magical occurs every time a banker copies a number from one side of his ledger to the other side. The amount that was merely a Deposit becomes a Loan as well as a Deposit, and the economy receives an infusion of new money. (Is it any wonder that Jesus Christ spoke about money so often in his famous parables?) In Old Sherwood Town, the magic of bank lending caused money to multiply and circulate through the surrounding farms and back again through the stores, churches, dance halls and saloons. Along the way, this new liquidity helped railroad towns across America feel more confident than ever about their own and the country's future. It was a level of confidence that neither Jefferson nor Lincoln could have observed in their own lifetimes. An entirely new vision of America was emerging... but first the world would have to recover from the deep recession of 1893-97. It was the Yukon Gold Rush of 1897 that gave the entire decade of the 90s the glow that was so fondly remembered in later years.