This completes the narrative of events up to the end of the crisis of 1908. No country has ever been so exposed as England to a foreign demand on its banking reserve, not only because at present England is a large borrower from foreign nations, but also (and much more) because no nation has ever had a foreign trade of such magnitude, in such varied objects, or so ramified through the world. In 1899 the Secretary of State wrote to the authorities in India:—“I see no objection to your lending to the Presidency Banks, on the security of Government paper, at such rates of interest from time to time and for such periods as you think best. But eventually (in May 1901) a scheme was arranged, acceptable both to the Mint at home and to the authorities in India. .
Indeed, it cannot be wondered at that the Bank proprietors do not quite like their position.
The holders of the Bank reserve ought to lend at once and most freely in an incipient panic, because they fear destruction in the panic.