In so far as the loan was used for these purposes it did not help the

His mind, at any rate, will in a panic be free from pecuniary anxiety, whereas many, if not all, of the present directors must be incessantly thinking of their own affairs and unable to banish them from their minds. 4 only on account of No. The briefest and truest way of describing Lombard Street is to say that it is by far the greatest combination of economical power and economical delicacy that the world has even seen.

The other point is a trifle and reflects, perhaps, on a curiosity of our economic organism rather than on the India Office. The one might merge in the other as convenience suggested and as events required. 2. A Parliamentary committee next year would, unless something strange occur in the interval, be a great waste of time. For the expedient of a loan is always available. A certain part of his time, and a considerable part of his thoughts, he can readily devote to other pursuits. In consequence, every commercial city abounds in men who have great business ability and experience, who are not fully occupied, who wish to be occupied, and who are very glad to become directors of public companies in order to be occupied. There should be a clear understanding between the Bank and the public that, since the Bank hold out ultimate banking reserve, they will recognise and act on the obligations which this implies; that they will replenish it in times of foreign demand as fully, and Lend it in times of internal panic as freely and readily, as plain principles of banking require. It would be said that, ‘being without experience, he had taken upon him to overrule men who had much experience; that when the constitution of the Bank had provided them with skilled counsel, he had taken on himself to act of his own head, and to disregard that counsel;’ and so on ad infinitum. Payment of dues to the Government could be made in the currency notes of any circle; and railway companies could, if they accepted notes of any circle in payment of fares and freight, recover the value of them from the Government. . The drain on the Bank is twofold: first, the banking reserve is reduced by exportation of the German money, which reduces the means of the Bank of England; and then out of those reduced means the Bank of England has to make greater advances.

And, in spite of the restrictions, the Presidency Banks have shown great vitality and a power of expansion hardly less than that of the Exchange Banks in the happier circumstances of the last decade.

The Banking Department of the Bank of England has over 40 per cent. But it is of great importance to point out that our industrial organisation is liable not only to irregular external accidents, but likewise to regular internal changes; that these changes make our credit system much more delicate at some times than at others; and that it is the recurrence of these periodical seasons of delicacy which has given rise to the notion that panics come according to a fixed rule, that every ten years or so we must have one of them.

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