4d. Up to 1870 the English currency system was the envy of the rest of the world, and it was supposed that the excellencies of the practical working of this system were due to the fact that the actual circulating medium of the country was gold. But I do not think that there is the least reason for supposing that the position is not a strong one. But the idea that the bankers’ balances ought never to be lent is only a natural aggravation of the truth that these balances ought to be used with extreme caution; that as they entail a liability peculiarly great and singularly difficult to foresee, they ought never to be used like a common deposit. Thirdly. We are still living in the debris of that controversy, for, as I have so often said, people can hardly think of the structure of Lombard Street, except with reference to the paper currency and to the Act of 1844, which regulates it now.
We need not too precisely examine such language; the element of truth in it is very plain–the great advances made to Overends were a principal event in the panic of 1857; the bill-brokers were then very much what the bankers were lately they were the borrowers who wanted sudden and incalculable advances.