laid the whole subject with such a mass of verbiage, of false assumptions, of vain and frivolous distinctions, that, like the Report of the Bullion Committee, their conclusions have been formidable obstacles to the progress of monetary science.

Mr. Loyd, now Lord Overstone, held joint-stock Banks to be "deficient in every requisite but extended responsibility." In this he was sustained by every witness an abstract of whose testimony has been given. Experience has shown the exact opposite to be the fact. All were opposed to "plurality of issue." A greater amount of gold, said Lord Overstone, would be required from a greater number of issuers. A far less amount is required relative to that of the currency issued, for the reason, that, the greater the number of issuers, the greater the degree of scrutiny in making loans. Parties seeking to make them must go to those to whom they are well known to go elsewhere would be a sufficient cause for distrust. "Plurality of issue," therefore, is a necessary condition of a sound currency. Where there are a great number of issuers, as in London and New York, there will always be settlements, by which each will be compelled to make good his issues day by day. The weaker must daily come up to the standard set by the stronger, in order to insure confidence in their issues. There can be no "competition" of issue, in the sense in which this word is ordinarily used, for the reason that capital must stand behind every issue, and must always speedily discharge it. Competition of issue, if there can be such, is competition in the employment of capital. To this there can be no objection. Upon the same principle that Lord Overstone objected to "plurality of issue," would he object to plurality in drawers of bills. The right to issue notes as well as to draw bills is based upon the possession of something to issue, or draw against. If perfect freedom were allowed, then every one, according to him, would begin drawing, and the world would soon be flooded with bills, some good, some worthless; and great losses would be the result. He forgot that it takes two to give utterance to a bill, as well as to the notes of a Bank. When a person receives such notes as the equivalent of what he has to sell, he will take good care that that which he receives shall equal in value that with which he parts. Self-interest, therefore, is all the check needed upon plurality of issue. A person has only to be imposed upon

once or twice, to refuse the issues of all parties that are not entitled to confidence. A few lessons of the kind will do no one any harm. The public are just as competent to take care of themselves in the matter of bank-notes as in bills of exchange, or in the purchase of property of any kind. It is in this very matter of issue of paper money that the greatest scope and freedom should be allowed, not only for the purpose of placing it upon the most stable foundations, but for the purpose of supplying, in the place of coin, adequate instruments of distribution. It is natural for an Englishman to repeat to himself, "One Government, one Bank." That would be all very well, were government possessed of all the capital of the country, if it had the same right to the administration of such capital as it has in the enactment and 'administration of the laws. But having no capital other than that drawn from the public by taxation, for immediate expenditure, it has no more to do with the issue of paper money than it has with the quantity of food to be raised, or of yards of cloth to be woven. According to Mr. Ward, the public interest requires the Bank to hold the smallest possible amount of treasure; otherwise the currency would be too much depressed. Properly managed, the amount of circulation would be in five or tenfold greater ratio than the amount of treasure held by the Bank. Loans should never be made for the purpose of getting rid of the gold held by it, on the assumption that its accumulation in the Bank is the withdrawal of a corresponding amount from the channels of circulation. Its accumulation in it may simply mean its transfer from one country, place of deposit, or hoard, to another. The accident that brought it into the Bank may speedily carry it from it. In such case, if loaned, it must be collected from the public, a process which may cause no small disturbance and loss. If the stock of gold in the Bank be permanently increased, say £5,000,000, its loans might be increased by £25,000,000 or £50,000,000, the gold serving as reserves, provided an adequate amount of good bills were offered. That they were not offered would be evidence of a want of merchandise to be symbolized. Mr. Norman would have no notes issued that did not rest upon securities other than commercial bills, upon Exchequer bills, government stock, bonds, lands, &c. He objected in toto to the existence of joint-stock Banks in London, or to increased

competition among issuers of paper money. But every person possessed of merchandise is just as competent to issue paper money as the Bank of England; and far more so, as the Bank is now conducted, as his issues would be based upon that which would return them to him without any act on his part; while the Bank might have to take in no small part of its own, by paying out a corresponding amount of its reserves, which it hardly ever does without loss to itself as well as the public. According to Mr. Tooke, there exists no more reason for two Banks than for two mints. All paper money should be issued, as coin is, by government - by the exclusive privilege of the State. But the only function of government in coinage is assaying and affixing upon the piece assayed the quantity of pure metal it contains. How can it assay paper? Its insignia does not give value in one case; how can it in the other? It creates no obligation when it coins gold; and, if it does not when it issues paper, the only effect of its insignia upon it is to render worthless what otherwise might have had value. The value of gold is measured by its cost; that of paper, by that which it represents. If government possess capital,merchandise, it may issue symbols against it, to serve in its distribution. So far it may secure to itself the profit resulting from its use, that is, interest on a sum equal to its amount. It may, if it will, turn banker, and issue notes, holding a proper amount of reserves. If it would be successful in such rôle, it must issue no paper that does not represent merchandise. But even such a wild and visionary theorist as Tooke would hardly venture to impose upon government such a function. If not, then he must leave the issue of paper money to those who have capital to lend. "An increase of paper money," says Tooke, "is the consequence of a tendency from other causes to a rise in prices." Tooke, as will be hereafter seen, was the great apostle of the doctrine, that an excess of paper money follows, instead of preceding, a rise in prices. Mr. Grote, like Mr. Tooke, "would have the Bank pay over to the public the profits of its circulation; retaining such portion of them as would be a fair remuneration for the trouble of administering it. A metallic currency would give no protection against fluctuation of commodities." How could any considerable fluctuation occur with a currency exclusively metallic, and so long as equivalents are exchanged?

Fluctuations occur when merchandise is purchased on credit in some form, and when the credit is not the equivalent of that purchased by it. In such case, credits, as well as capital, are competitors in the market, and prices rise in ratio to their quantity, or to the demand. When the credits mature, and payment is not made, then the prices of merchandise which has been purchased and held on speculation fall, from being thrown upon the market. So long as paper money is the representative of merchandise in demand for consumption, the effect of its issue upon the whole market is to reduce, instead of to increase, prices, by discharging a corresponding amount or a certain amount of capital from use as money. "Fluctuations would occur," says Mr. Grote, "in a currency referrible to any definite standard whatever; and, doubtless, our standard is less liable than any other to variations." This single paragraph epitomizes whatever of speculation and theory .there is in England upon the subject of money: "Fluctuations are inevitable in all systems; but ours is the best." Mr. Glyn opposed plurality of issues on the ground that the natural inclination of all Banks is to seek profit for their proprietors by extending their issues; forgetting that the only check to such inclination is to place all issues in a position in which they cannot indulge in any thing of the kind without being immediately called to account. Mr. Gurney held that "no country banking establishments can issue more notes than there is a demand for." There will always be a demand for whatever issues are made, so long as they will be the equivalent of capital to the holders. There is no more limit to the demand for paper money, so long as it will exchange for any thing, than there is for capital. Mr. Gurney, like the other witnesses favorable to the Bank, held that paper money should be based upon governments in preference to bills; that is, that the principles upon which the operations of the Bank were conducted were wise and proper.

Those who were examined as representatives of joint-stock Banks - Mr. Stuckey, Mr. Wilkins, Mr. Dyer, Mr. J. B. Smith, and Mr. Burt-ventured mildly to suggest, that Free-Trade might prove as advantageous in banking as in commercial and manufacturing industries; and that in ratio as such freedom was secured at the expense of the exclusive privileges of the Bank

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of England would the value and stability of the country circulation of all kinds be increased. Such representations-coming from feeble and struggling institutions, as they were at the time — had no more influence over the public mind than would propositions at the present day for the abolition of the House of Lords and the distribution of the royal revenues even the crown itself - among the people. Englishmen bow reverently before quantity and force. These, under their system, which allows great freedom to individual action, and secures to it its proper reward, are the certain product of time. The joint-stock Banks, which existed in the outset by sufferance as it were, biding their time, have now grown into such colossal proportions as to challenge the reverence which the Bank of England once wholly engrossed; and their managers, who for a long time stood, hat in hand, in presence of its Directors, now do not scruple to hustle them off the walk whenever the crowd is too dense for ease of movement. The very privileges and monopoly of the Bank have now come to involve great burdens and great responsibilities. As "manager of the currency," it has to supply reserves for that of the whole kingdom; amounting, including deposits as well as notes, to some £550,000,000. The least disturbance in the money market, or in commerce and trade, or the slightest foreign complication, are warnings to the Bank. How to strengthen its position and increase its reserves has for years been the paramount question in the monetary and commercial circles of England. At present its only means of defence is in its power of exacting exorbitant rates on its loans. This is a very feeble one against an excited crowd ready to sacrifice whatever they possess for the maintenance of their credit. In olden times, the Directors of the Bank might set its operations upon a given key, and go to sleep for a half century. The rates now charged appear and disappear with the celerity of the figures in Punch and Judy. The wider the discussion of the problem, the more difficult appears its solution. Fortunately, in such a country as England, where every valuable achievement or step that is gained serves as vantage-ground for something beyond, all such questions solve themselves. From the foundation of the Bank in 1694 to 1797, there was very little fluctuation in commercial or monetary affairs, for the reason that it was an instrument of commerce, not of the government. Its