At that time london was at the height of her financial supremacy, and her monetary arrangements

Three times since 1844 the Banking Department has received assistance, and would have failed without it. The business of an old-established bank has the full advantage of being a simple business, and in part the advantage of being a monopoly business. Perhaps we may fairly sum this evidence up by saying that it goes to show the existence in India at the present time of an enormous demand for gold bullion, a very considerable demand for sovereigns for purposes of hoarding, and a relatively smaller demand for them, chiefly confined to the United Provinces, the Punjab, Madras, and Bombay, for purposes of currency. 3. . At present there is at least the possibility of a great reaction. Not only no private banker is a director of the Bank of England, but no director of any joint stock bank would be allowed to become such. .

Moreover, even a superficial acquaintance with the currency history of India brings experience to the support of reason. In conclusion, something must be said about proposals for a State Bank. If the Exchange Banks are remitting funds back to London, this shows itself, therefore, in a poor demand for Council Bills; and conversely when they are remitting funds to India, there is a strong demand for Council Bills.

He would run no more risk by the failure of the bank if he made a deposit there, and he would be free from the risk of keeping the cash.

) Current Accounts │ (ix. In theory a certain portion go out annually, remain out for a year, and are subject to re-election by the proprietors. of deposits, and against this they hold in the funds securities of the best kind. But, in fact, in the South Sea Bubble, which has always been remembered, the form was the same, only a little more extravagant; the companies in that mania were for objects such as these:–‘ Wrecks to be fished for on the Irish Coast–Insurance of Horses and other Cattle (two millions)–Insurance of Losses by Servants–To make Salt Water Fresh–For building of Hospitals for Bastard Children–For building of Ships against Pirates–For making of Oil from Sun-flower Seeds–For improving of Malt Liquors–For recovery of Seamen’s Wages–For extracting of Silver from Lead–For the transmuting of Quicksilver into a malleable and fine Metal–For making of Iron with Pit-coal–For importing a Number of large Jack Asses from Spain–For trading in Human Hair–For fatting of Hogs–For a Wheel of Perpetual Motion. I do not imagine that it would touch the Issue Department. To transact these two classes of business—though once established they have not limited their transactions to them—a class of Banks has arisen known as the Exchange Banks. , or nearly 1/3 rd of their capital, principally out of undivided profits. There are a few well-known exceptions, but according to universal belief the deposits of most private bankers in London tend rather to diminish than to increase. It is sometimes said that any foreign country can borrow in Lombard Street at a price: some countries can borrow much cheaper than others; but all, it is said, can have some money if they choose to pay enough for it.

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