(e) excluding reduction of debt by annuities and sinking funds included in home charges

“As regards melting,” writes Mr. But the demand did not expand, and the very large issue of currency immediately before and just after the closure of the Mints proved sufficient to satisfy the demand for several years to come;—just as a demand for new currency on an abnormally high scale from 1903 to 1907, accompanied by high rates of discount, was followed in 1908 by a complete cessation of demand and a period of comparatively low rates of discount.

When the reserve is between 14,000,000 L. The proper magnitude of the reserve must depend upon the particular circumstances of each country. In times of panic there is always a very heavy call, if not a run upon them; and in consequence of the essential nature of their business, they cannot constantly keep a large unemployed reserve of their own in actual cash, they are obliged to ask help of some one who possesses that cash. _, apart from the import of funds from foreign countries) absolutely inelastic. 2 has No. If general distrust of banking was widely spread, and notes, gold, and rupees were being hoarded in the old–fashioned way on a large scale, the banks would not be able to put their hands on sufficient cash resources of any kind to enable them to pay for the Government’s drafts on a scale adequate to their necessities.

But if this were to happen, it would have no consequences worth thinking about. They were thus led to imitate the form rather than the substance.

I will discuss, first, the nature of the existing methods; second, their adequacy for their purpose; third, some proposals for making them more orderly and intelligible; and lastly, the management of the cash balances.

25. Lowe has lately given us a weekly account, and from this, and not from the Bank account, we are able to form a judgment. A country dependent mainly on great ‘merchant princes’ will never be so prompt; their commerce perpetually slips more and more into a commerce of routine. However much the Bank may dislike to aid their rivals, yet they must aid them; at a crisis they feel that they would only be aggravating incipient demand, and be augmenting the probable pressure on themselves if they refused to do so. It may be said that the reserve in the Banking Department will not be enough for all such loans. │ in Hands │ of │ Hands of │ │ │ Production. The effect of these failures would be a general run on all bankers, and on the Bank of England particularly. During the immense payments from France to Germany, the sum _in transitu_–the sum in London has perhaps been unusually large. The cash reserve of the country is as precious a deposit as any set of men can have the care of.

Mr. And the history of banking has been the same. Every part of the system fits into some other part. In the first place, it sells exchange, save in exceptional circumstances, in one direction only. But Charles II. In common opinion there is always great uncertainty as to the conduct of the Bank: the Bank has never laid down any clear and sound policy on the subject.

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