Star. — London, England, 1819-05-22 00:00:00

• •-\ Vi t 1 Acyonskthis plot they do not madder themselves justified In 4.* * saki: Open my opinion, conjecture, or speculation merely their own—and when a system is recommended, it semis to take' , away from the Bank any thing like a discretionary consideration at the necessities and the distresses of the Commercial Wo d 4 " If the Directors withboketheirpeesrime consent, k is not from a want of deference to Ms Majesty's Givernment, or to the opinions of the Commitasea ' of the two Reuses of Puna ment ; but solely from a scrips fooling that they have no right whatever to invest themselves, of their own accord, with the responsibility of countenancing a measure, in which the whole community is so deeply involved, and possibly to compromise the universal interests of the Empire, in all the relations of Agri. culture, Manufacture Commerce, and Revenue, by a seeming acquiescence or decl ared approbation on the part of the Direc tors of the Bank of England. " The consideration of these great questions, and of the degree In which all those leiding and commanding interests may be af fected by the measure proposed, rests with the Legislature; and it is for them, after solemn deliberation, and not for the Bank, to determine and decide upon the course to be adopted, " Whatever reflections may have from time to time been cast upon the Bank ; whatever invidious representations of its con duct may have been made, the cautious conduct it adopted in so measuring the amount of currency as to make it adequate to the wants both of the nation and of the Government, at the same time keeping it within reasonable bounds, when compared with what existed before the war ' as is slump in the Lords' Report, pages 10, 11, 12, and 13; the recent effort to return to a system of Cash Payments, which commenced with the, fairest prospects, (but which was afterwards frustrated by events that could not be foreseen nor contrauted by the Bank), are of themselves a sufficient refutation of all the obloquy which has been so uncle savedly heaped upon the Establishment. " The Directors of the Bank of England, in submitting these considerations to his Majesty'S Ministers ' request that they may be allowed to assure them, that it is always their anxious desire, as far as depends upon them, to aid, by every consistent means, the measures of the Legislature for furthering the prosperity of the empire. (Signed) " ROBERT BEST, Sec" The Paper was immediately ordered to be printed for the use of their Lordships. SCRAMBLES IN THE OLD-BAILEY COURT. Lord BULK ELEY said, that he was desirous of knowing if he might allude to what he had observed in the Newspapers' —(Rear, Hear! end loughing.)—Seelng the Noble Secretary for the Home Department MM. place. he lisped that Noble Lord would not take the quad= he was about to ask swiss. What he wished to knew was. whether steps had been taken to prevent the scrambling for the property of Feloss, as was witnessed at the Old Bailey on some trials in April last? Viscount SIDMOUTU knew nothing of the transactions which the Noble Lord (ikilkehey) mencioned,bsst what was stated in the daily Papers. No representations had been made to him, nor was he called on to interfere is any war. Unless the sub ject came before him in an official way, the Noble Loid must be satilified that it was impossible forhim to interfere- RETURN TO A METALLIC CURRENCY. The Order of the Day .for their Lordships taking the' Resolutions founded upon the Report-into cone .deration, being read, 'The Earl of HARROWRY, pursuant to his notice, rose to move.Cor their Lordships agreeing to the same. The Noble President,•in a short introductory' speech, very little of which, from the evident indisposition under which his Lordship laboured, could be satis factorily heard• below the bar, recommended the adioptioa of the Resolutions, as presenting' the most salutary and least unexceptionable way, under the present circumstances of the country. for a gradual roam to the ancient and long established currency nit-the country. The proposed plan went by gradual ;ad regular krreani io . effect so important an end, and preclude a mode which may fairly be questionable as hiOiy. iWurious, namely, an attempt at too rapid a R6urnpffon of .Cash. Payments. In concluding, the joble Eatl a.poiole;sed, from his MUD of !Wraith slam evening. for his inabritto enter opera detailed vie w of the subject ;.• and Moved their 'l,ordships' =qui acence in the Resolutions: • The Earl ctIATIDERDA - LE, after expressing his regret et the Noble President's state of health, and seeming at present to deprecate a detached discussion of 3 the subject, moved an amendment to the motion for agreeing to the Resolutions, to leave out all after the word it That," for the purpose of introducing a series of Counter-Resolutions, deducing widely diffe rect. conclusions from what had appeared before their 'Lotlishipe Committee—and that an alteration of oar Mint regulations, such as will approximate the Mint valises of our saver and gold coin 40 the market va lues of these metals, is a necessary preliminary step to the restoration of our currency to a salutary state. These the Noble Earl moved should be agreed to by the House, in the ward amendment • Earl GREY proposed, as the most advisable course in the present state of the question, that the Resolu tions proposed by his Noble Friend should be printed and lie over for discussion to some future day. His Noble Friend's proposition took a totally different view. s of the important subject, and it could not be ex pected their Lordships could at hearing them once read, be sufficiently masters of their import to discuss their comparative merits properly. He deprecated any idea of putting off the discussion merely for the sake of delay. His Noble Friend, who perhaps was more conversant with the extensive and intricate sub ject than any other man, thought what appeared be-, fore the Committee admitted of very different cos elusions from those embodied in the Resolutions pro posed by the Noble Earl opposite, and their Lordships certainly ought to have some interval of judging be tween 'the two. He should therefore earnestly recom mend the coarse he had adverted to, and would sug gest Tuesday next as the earliest proper period for resuming the discussion. The Earl of LIVERPOOL expressed his opinion, that the subject was of that peculiar importance, that it was essential ( whatever opinion may be fo rmed upon it), the decision of Parliament should be made' as speedily as practicable. More disadvantages might arise than many seemed to be aware of; from the question bang thus left ip 2 state of uncertainty and . indecision. And farther, as the subject might be con nected in some degree with the conduct of the Exe cutive Government, he for one was anxious for an early opportunity of delivehing his sentiments How ever, if it should be the mend sense or p 9f their Lordships, he 'would not individually 410..*- 3. a short' postponement of the, discussion. • . • The Earl of ROSSLYN was of opinion it would be more advisable to postpone ti - discussion, for , there were many. Noble Lords, he *might, who could pot, In the interval allowed, fall A 54iyoutto jud " •on the merits of the question). The suggestion Of' the Noble gir t h . a c t. Ade i l • the woolsack not seentirigto meeilltelateral currehce of the House" ' 4 4 • • . The Earl" of. LivpirpoL rose and proceeded re. gularly to theliscilujoii of the important subject, be fore the H. There never, he observed, was any subject so thorougidy sifted ,by Parliament as that now under comiderationi'l eras not 'only before Parliament thet ti !subject had long been in a course of discussion, but it as as various Wers shapes before : E ,1- i I , 1 f ' ' t - f' 1 1 ' r , , , ~, • • 't 1 , . ! 1 .1 i , , , 1 !a i I : ii N., , t --- ) i ir i R ' { ''. ' 1' 1 ' 1 i It' . I • ' i 1 I t . 1 1 . '•%46 1 I the of seriouti it before their' rather with a i wise. Nor tau— of its merits, its nature and extent presenting tuft, ciendy formidable task without coupling the subjentl with considerations of abstract theory. Thus cteter.- mining, he would observe, the House now had three wen questions to attend to; First—Was it expedient that the couag n should recur to some fixed standard of value? dly—ls it practicable and expedient that a return to the ancient standard of value should take placet Ahd thirdly—What are the best means of effecting &tire results ? In considering these parts, the quesddh of the extent of the currency was the first considefation. .He had always contended, and was still ready to admit it, that the Bank Restric tions were the means which enabled us to wea ther the *orm which so long overhung this coun try, and enabled it to get through those difficulties, which, on his conscience, he believed it otherwise could not. It did not follow that he thought this system ought to be acted upon in all wars. But the last contest was one dissimilar to all others.— All the Powers of Europe were at one time linked to gether, under the eontroul and direction of one Power, whose object was, first the ruin, and subse quently the subjugation of this country. Commen surate means and exertions on our parts to resist this unprecedented array against us. were indispensably necessary. Those circumstances were however new gone by, and we were called upon, in peace, to de cide, in sound policy and expediency, what course ought to be adopted by this country. Parliament had, by its acts since the peace, declared it was the. duty of tiers country to recur, as soon as it was prac ticable, to its former system of currency and circu lation. It was unquestionable, in his mind, that we ought to return to some fixed standard of value; and his firm belief was, that the great mass of opposition which presented itself to the proposed plan (though he thought it was conscientious on the part of the Bank) was directed, not against the• Resumption of Cash Payments at anyone interval of a year, or of six months, or at any time—but against the event of their ever returning to Cash Paymentsl All the reasoning of such persons went to such a length.— But such a system was never found to exist in any society ; all countries had some standard of value or other, whether it be copper, iron, silver, or other metal. All proceeded upon some fixed standard of flue ; the departure from it was never pro as it permanent system : neither could it be Were the dictates of sound policy, regson, or even of common honesty, attended to. All we had hitherto done was, with reference to a return to our former system of currency. He never doubted the modera tion or justice of the Bank • but would ask, whether Parliament could trust the!Bank to an extent which it had never done with respect to the Sovereign upon the Throne? How did the case stand? The Bank, for instance, issued twenty millions of Notes upon Government security; we paid them about a million interest ann . r s ll But was it reasonable Or fair that. the Public pay star-gialt a millioe aleariesl the security of their notes; when, by issuing theit own notes, the Public, may save the annual million ? Some standard of value was unquestionably neces sary ; such was liable to fluctuations, especially in periods of war ; but now in time of peace, we should look steadily at our situation, and endeavour, as soon as practicable, to return to that state of currency, which was most advantageous every way; as well as the most economical. He wished the subject should be considered practically, rather than theoretically ; and he would ask, could they consistently leave to -any body of men to issue their notes without refer ence to some regular system or standard of value? He wished to put this leading principle in front of the debate, and as the grand point upon whickithe whole should turn. The next point was, whether, if it were fit to return to forte fixed standard of va lve, it were fit to return to the ancient standard ? and this, upon every principle of political wisdom, and even of honesty, he thought they were called upon to do. ' The standard to be considered was, as it existed before the Bank Restriction took place, when gold was at ES. 17s. 10d. This was a question which went in some shape or other to affect every individual in the kingdom, and it might be regarded as the contract entered into with the creditor ; and it was the duty of Parliament to see that such contract was fulfilled, and be could shew that no material in convenience in following that course, in consequence of the great exertions which we had been compelled to make, had the effect, for nearly a period of three years, to raise the price to ES. 4s. making a differ ence of between 20 or SO per cent.; but when peace arrived, they had all this ground to tread back. The progress in the lowering the exchange was interrupt-k ed by the landing of Bonaparte in the year 1814. — But about the middle of 1816, the Exchanges again became favourable for this country, and the. Mint prices of Gold proportionably fell; and if the Bank had not interfered as it had done, the price of Gold would have been about £3. 15s. ; and for a whole year at least the Exchanges were favourable, and Gold was below the Mint price. The great mischief was, that the Public would not read the Itepottt nay, be had himself heard many say, rlowdory diet jus want to read it. In fact, most went And suds Op their minds on the subject, and vrestteet-siter their preconceived opinions. If, hirstevar, be had ese,ceeded in 'hewing how small the sfiffelentit Was, , between the established Standard and the Mint Itao plat ons, a great part of the diffionhy was done sway with. The desire , of the Committee' was to effect the.object in the most gradual way—in short f its do it •so auto obviate, - if possible, all the difficaltios, an& objection= Whatever Might be the obi. and he was far float denying ohjectiona44ha plas,itself Dearlo , the prinosples•whieh idsteblips, lad orhieh war , the changssinihe mot gradual stated in theitepert, that - avoided was a rapid deereaseo that &stoutest evil would-be bate untruth* of these issues.' this opinion it was a c' plan to proceed gradu ally. dll February, and would for four years. Even these issue f.paph. • _ A Pe.„_. B g ist.9 , the of ittiArnft wa s the n last dear the A the :2 6ll lg a :2l:rw ith. re ra libibili j i i t alt itsu s tratept 'by £4,000,000 ; and there was no increase in the issue of the Country Banks. Therefore in that year theft *as a decrease on the whole amount of the cir culating medium in the country. And yet, notwith standing this decrease, the exchanges became mote unfavourable, and the price of gold rose. This, how ever, was to be explained by the effect produced on the money market by the pecuniary transactions of foreign Governments. The Noble Lord (Lord Lau derdale), however, contended that all this might be obviated by a still greater diminution of the issues. With regard to this, however, it was to be considered that when the counteracting causes went to a cer tain height, any diminution of fill paper circulation produced an intolerable inconvenience. But on the whole, he did not think that there would be any dif ference of opinion as to the proposition that a reduc tion of the circulating medium increased the'value of what remained in circulation. He would now pro ,keed to consider the merits of the proposed plan.— Its first advantage arose from its gradual operation. gthe Bank was to be called upon to pay in 'specie, it a, given period, time must be given to prepare' for SO important a measure. At the same time he must' confess his own opinion, that if the Bank 'were to re-1 sante cash payments tomorrow, there would be no considerable demand upon them for gold coin. But WP man would deny, that if the Bank was required to pay in cash so soon, they ought to be prepared with the means of paying in coin, if coin was de manded. The first positive advantage of this plan was, that the Bank could resume cash payments with a much smaller amount of specie. Under its opera tion, all demand for specie, arisingfrom fancy, from caprice, from internal alarms, would be prevented ; and the only demand would be for the purpose of profit. As long therefore as bullion was below the Mint-price, and as long as exchanges were favour able; there was nothing to fear. The next great ad vantage of the plan was, that it began on a principle which was quite fair ; and without recognizing . any principle of depreciation. It went on this principles " We will arrest the evil where it is—we will begin at the etrliest possible' period—we will not put off opening the Bank till some future and indefinite pe riod when we shell have plenty ofcoin ; but we shall begin now, taking the market price of gold as it now stands, allowing the evil to proceed no farther, but enabling the Bank td work its own way to a com plete return to cash pigments." This was the sys tem of the whole plan. He must admit that it curred to birdie/heeler the period was not put too far back ? It might be said if we were to begin at the market price, why not begin at the earliest period ? This seemed very proper, but there was a good reason why it should not be done, and why there should be sorer- 4•14 y - .The debt due by Government t_ • Bank enust-be tepaid, and this would reouire sale delar. Astir tete it was to be observed, that the question stood on rather strange grounds, as between the Government, the Bank, and the Public. If the prevailing opinion in'London was consulted, it would be found that the greatest jealousy prevailed on this . subject of the repayment by Government of the ad vances made to them by the Bank. And he must admit, that if the present system were to be core nued there would be some foundation for this °Woo tion. But it was his firm opinion, that every mer chant in London would prefer a circulation at once founded on Government security to having the state of circulation depend wholly on the judgment of the Bank. He must confess that the advances of the . Bank to Government had extended to a greater amount than ever was intended. As to the state of the exchanges, as affected by the circulation, the greatest latitudinarians on this subject must admit that the exchanges would become favourable, even if the Bank circulation of paper continued as high as it-now was. He did not believe that the alarm of a great and sudden reduction in the issues of the Bank was well founded. At any rate, the whole object of the plan was to give the Bank an opportunity of purchasing bullion, and he firmly believed that no sudden reduction o f the Bank issues was now in con templation. He had already noticed the advantages which the existing system gave the country in the time of war. It had also its advantages in the time of peace, by the facilities which it afforded to com- merce—faiilities which merchants would no doubt be sorry to lose ; and which he must admit never could exist to the same extent under any other sys tem. Its effects upon the public had already been adverted to. Of these, this was the most remark abko—that in the times of commercial distress, the Bank was not obliged to reduce its issues -.-(Hear.) This was mentioned as a great advantage; but it was Merely fallacious. It was an unnatural state of things producing this effect, that when the country was really distressed, it appeared not to be distressed, --that whenit was poor, money was as abundant as ever. It must not be supposed, however, that the paper system, even in its most beneficial operation, reduced unmixed good. It gave encouragement to mercantile speculations—to fictitious -dulings ;—it bleated a fictitious capital,—things which, Ma course d years, were likely to produce more permanent to the.countrr than could be named,.in compa with the temporary inconvenience which would z'sthe first instance be produced by: the proposed It hart always been his opinion, and he had expressed it, that it would be impossible ton ,, art • the ancient system without incurring a mint.: But by the appointtnelat Report was now before part of that inconvenience-hat All the inconveniencessehichl be less than those whiohJata, It would therefore •lie:ids a pillow to twin their backs upon lir* they had proceeded sec far.: , scone arguments• adduced the most :talkie/ of these he ileiy; to that winch was drawn the , ansouit et- the Circulat sounayt and that whichiorsd the Public, and toad- beetrthe - d'al siert Mobs at , trebilllillll2lllt admit , coottilled5; 11 0 WON of .0 111 Itn in the fablic Prilieg: ' Map Iwtbd 111018110P•aidalhl ward tot leawarthersce of Gold.dr- was I sioti would, he must agnift dbilive, be prod.," Sit dili "eat queitiet wat am ts the Inconvenience Pled die of serious inconvenience. He Wduld need to Wag atfildt tide would produce. lioangeboolOt best then fore it before their Lordships upon ended principles, an d wytdd be to beonreaance ego aperapon was not lads rather with a reference to it proipectively than mho& fottiml. -For his own part, he serer cotdd understand it b wise. Nor should he enter into am abstract views hdw a doubt could be entertained on the subject ; map - _ - ----..i..:.m. As, as the MOWS of the ing . ke, cattim: l Might be the objections:6u sort to the ancient system ring that-there were same potary in convenience. B was nue which came most the toinnittee whose: Re It had prevailed with tittle Eordships, the greater pas calculated. to brit* 04Sue §e, dually incurred. Al dual way. It was pre ' ' 'tires' ensue would I at if-the great evil to be ialtuudrikenproduced: reaseo the Bank issueo...L.i ' td for theitliordshiprn ,dire a forted andiviseti;.. ar'sobeitt*ok which .ti sees." In conformity with- Lverel+hrmarer9.''l *object %of th eipviiiveat * rat'theittatio'iltoAl .• .It vivlllot td - libtitt 'laity ooto fie iv4onLif b be' 4biVett' AIWA MHO iletlaftl*wiht file t notorious * fcril l: i th MeL at the Th a. ° m C ou ill rit of the Circular;- Medium was greater than it had ever been at „ and 4 .ll d s. former_ period. He would assume, that the Cs a no: re, incre aw hiting Mediutn now was no more tha n . equal to Itc • bad been in 1797. This was putting the a ". 2%; meat in the strongest possible_light—i t w as i ma r ; hag at case even stronger than that which the R , D 7 07 , 3 ' established. But even supposing this equality, n s it ; taking 0 t 1 the a t Trade , Agriculture , gribacdui were doubled—all this he would admi t; teal still he would undertake to shevr,'thst While rb View of Capital in the country had thus incmism. tend the amount of the Circulation rer4iained station. ney, that amount was not only as much as a a . I miesary, but was even too much. Anv difference % this point must, in his mind, arise from not taint s ; ling properly the difference of a Aletalfc 'ead from not considering the power of Paper. were aware that Paper Circulation, except for L iu sums, was not of an old date. Before the war, there was scarcely any such thing as a Cctmtly Bank. Individuals were then obliged to keep, * siderable hoards of money, to enable them to carry on their dealings. Here, then, on die very iir.t Viet , was one great cause why, tl.,dei the old system, I great amount of Currency was required, for a p ee . • powsvilich it might be said was new wholly ten. known. Besides the removal of th'• great can* tf a larger proportional Circulation under the old rye. tem, there was another of very extensive effect` namely, the new mode of Bankers clearing the ac• aunts, which made a smaller amount of eirculatica t neswer the purposes of Commerce than had ro nte e i lime required. On this subject, he read a passage Mr. Colquhouus's Treatise on the Wealth gad He acmes of the Empire—a Work which he d6cribe,l as of great value and considerable authority It de scribed the arrangements adopted by the Undo-, Bankers for settling the .1 lances of their daily trans. actions--arrangernepts by means of which sixty-ei g ht millions of money only weri,required to be in circ lation, where £457,000,000 would have been requitti under the old system. This was effected by al agreement between the Merchant's, that their c" , ders en their Bankers thould not be called till the end of the day, when the forty-six Bakes met, and balanced t their accounts, paying r.c. thing_ but the balances. By this arrangement, t.Lr velocity of the circulation appeared almost inert& ble; and one million performed as much as twerq millions. It now occurred to him, and he was sort he had not sooner thought of it, that it would be me ful to have some further information which might more coropletely illustrate this part of the subject: for frnstance—calling the amount of the Rink cam. lation in the last year £27,000,900, which was the amount, as. it appeared from an account he held ii his hand, it would appear dint she - items 'kid made up this gross sum wets. worthy the attention of the House. thus of those_ £27,000,000, twenty all. liens were Cl Notes,. send tram the nuasbe, of tiros that the Notes of various •denominations had ben issued, and the length. pi time they had been is dr. culation, it was fauna "tlint £27,000,000 did the wort taf £240,0(X),000. .It appeared that the £l, aad • Notes remained in circulation. on an average, ; • ~ 137 to 147 days; that the i. 2 3oo:Notes remained in circulation, on an average, about - fourteen days, and the Ll,OOO Notes only thirteen days. The a• counts from which these results appearectwere al ready before their Lordships. But it °realer to him, that it would be important - I*CA for imam accounts before the Restriction, and hesegtetted that they were not before the House. But he was enabled to state, that in that year the average tune during which £l, £5, and £lO Notes combated in circuit. don was 250 days, instead of 137, as now; that the £l,OOO Notes, which on an average remained oat at Ct thirteen days, were then twenty-two days s e . n shevved to what an extraordinary degree the rapidity of circulation had increased. Before the Bank Restriction, when a circulation of fifty red lions was talked of, it meant 20,000,0001. in specie, end 50,000,0001. in paper circulation, but now a cir culation of 50,000,0001. meant 50,000,0001. after. It was impossible for him to say whether the cats. lotion was too great or too small, when it was tale et 50,000,000/. It depended on other circummaas and contrivances; and there was only one way °lse lin at the truth—that was, by having a Emden. dard of value. The Only means of effecting &isms by having the value of the paper in the precious me. tals—in gold or silver. Those who talked so man of the evils of a limited circulation went on a great mistake ; for when the transactions of a country well founded oa solid wealth, a proper Circulating* diem would always be provided in the coined things. At the same time he did not mean to AY. that when from any circumstance a Metallic Cuneacy was suspended, that a return to it would eat be c• tended with very serious evils—though he contended that they would be but temporary. To strengths his opinions on this subject, he referred to the esi dence of Mr. Fletcher, Mr. Page, Me. Mashes, aid others. It was, however, contended, that tbeldietse gulations operated unfavourably on the price of sins When the Mint wannot open. and the Goverment kept the silver circulation in their own bands, end the Legislature provided - that. it should ant be a lied tender for any man above forty shilli n gs , he cooling understand haw Mini regulations have seeks effect as was mentioned. If the Neble Leers Lauderdale's). reasoning on-this subject was cannot it would equalre, apply to copper twin and $ sine cobs. But theft* teas, that, the silver coinage an Mt :at allneenden,the same ground as the go Thus he .Itad brought before. the House his vieo upon thin mat important subject, and lie hackisme so With an ardent and anxious desire to revert to = fire! standard of currency, as speedily at possq)ly, such a way as to produce theleancemenienco4rx distress." Suelt:Jen..itgekr as drat which- had ke 2 sir instituted coOktioethe *a foot without many 1 .. conveniences.- it' indiiced many men to deliver a tt. . : " • On oat a subject to.whieltfrom habit and Cd ro. cation they were very ill Atteil to decide, and it p at duced necessarily an, immediate aid powerful upon the commercial interest. Such an effect . jil ts produced. But this must be said, that the . had Been gone into aithinekt.: any. Om animc". without any sacrifice - of principle, and with a 5. 12 desire on the part of thoie who.werethe amt arn . i t ok! for a return to a • fi xed standard of curr.cncy., should be done with;theleastificeti v enicucc—. El 7 I