The government were hard pressed to supply sufficient rupees in 1906, and hard pressed to supply

But the Government also possessed a far greater power, of a somewhat more complex kind. If they were bred in it they might stay in it; but they would never begin it for themselves. Speaking broadly, those bills can only be paid by the discount of other bills.

The Gold–Exchange Standard in the form in which it has been adopted in India is justly known as the Lindsay scheme.

And indeed there plainly is a diminution in the purchasing power of money, though that diminution is not general and permanent, but local and temporary. Most of them would not know how to carry through a great ‘Exchange operation,’ or to ‘bring home the returns.

This is obvious if we remember whence that augmented money is derived. Amongst European countries, Russia now keeps the largest aggregate of funds in foreign bills and in balances abroad—amounting in November 1912 to £26,630,000.

Those who live under a great and firm system of credit must consider that if they break up that one they will never see another, for it will take years upon years to make a successor to it.

The ordinary foreign trade of a country requires no cash; the exports on one side balance the imports on the other. Is it possible to conceive of any remedy or moderating influence for the somewhat severe seasonal stringency still experienced? 6.

But very few persons are aware how much greater the ready balance–the floating loan-fund which can be lent to anyone or for any purpose–is in England than it is anywhere else in the world.

In this matter of the use of cheques Great Britain has been followed by the rest of the English–speaking world—Canada, Australia, South Africa, and the United States of America.

But there is a presumption, I think, that, in the absence of a State Bank, they must be made, mainly if not entirely, through the Presidency Banks. They thought they could frighten the Bank of England, and could show that if they were dependent on it, it was also dependent on them.

The ‘loanable capital,’ the lending of which caused the rise of prices, was lent to enable it–to augment. the rupee, and cashed out of funds from the Gold Standard Reserve.

But since 1857 there has been a great improvement. The Indian Specie Bank is the only Indian Joint Stock Bank having a branch office in London; but this is probably in connexion with its business in silver and pearls, and this Bank does not transact any considerable volume of business of the kind undertaken by Exchange Banks. But this is most unlikely to be the case. The rise of prices is quickest in an improving state of credit. But these are only a small part of the securities on which money in ordinary times can be readily obtained, and by which its repayment is fully secured. The Bank does, in fact, at every period of pressure, advance to the bin-brokers; the case may be considered ‘exceptional,’ but the advance is always made if the security offered is really good. Z feels the want caused by the diminished custom of A, B, & C, and so it does not earn so much; in consequence, it cannot lay out as much on the produce of A, B, & C, and so these do not earn as much either.

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