In the last century, a favourite subject of literary ingenuity was ‘conjectural history,’ as it was then called. No result could be worse than that the conduct of the Bank and the management should be made a matter of party politics, and men of all parties would agree in this, even if they agreed in almost nothing else. Such has been the unbroken practice of many years, and it would be hardly possible now to break it. 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. The largest account at the Bank of England is that of the English Government; and probably there has never been any account of which it was so easy in time of peace to calculate the course. , at which figure it has remained without sensible variation ever since. In a great panic, Consols cannot be sold unless the Bank of England will advance to the buyer, and no buyer can obtain advances on Consols at such a time unless the Bank of England will lend to him.
Most of the detailed evidence, which is available, refers to the Punjab; and care must be taken not to apply to the whole of India opinions from witnesses in that province as to the present position of gold. I would have them real trustees, and with a good trust deed.
Of this total the greater part was held in sterling securities—about £16,000,000 (market price). As Sir G.
; they now are more than 60,000,000 L. All the material facts relative to the English revenue, and the English expenditure, are exceedingly well known; and the amount of the coming payments to and from this account are always, except in war times, to be calculated with wonderful accuracy.
‘ And I will answer the question plainly, though in so doing there is a great risk that the principles I advocate may be in some degree injured through some mistake I may make in applying them. There seems little reason, therefore, for over–anxiety lest the Government be caught short of rupees. This greater infusion of gold would necessarily be at the expense either of the Currency Reserve or of the Gold Standard Reserve.
Is that trust justified? and is that confidence wise? These are the cardinal questions. The French have generally a logical reason to give for all they do, though perhaps the results of their actions are not always so good as the reasons for them. The Gold–Exchange Standard arises out of the discovery that, so long as gold is available for payments of _international_ indebtedness at an approximately constant rate in terms of the national currency, it is a matter of comparative indifference whether it actually _forms_ the national currency. . But I contend that it is quite impracticable, and if it were possible, it would be most inexpedient; and I can only express my regret that the Bank, from a desire to do everything in its power to afford general assistance in times of banking or commercial distress, should ever have acted in a way to encourage such an opinion.