The Stourbridge Observer, Cradley Heath, Halesowen & District Chronicle.
Stourbridge, West Midlands, England, 1869-05-15 00:00:00

3tourioibg Ourim.

SATURDAY, MAY 15, I*3 9 .

THE MONEY MARKET.

The recent alteration in the Bank rate of die-
count produced a decided effect on the markets,
elieeking specalative activity and deadening even
ordinary trade and connnerco. There MIN fort
time a panic iu commercial circles, and even now
the action of the Bank exerts considerable in-
fluence of a depressing character. It is not only
the feet that without notice or warning, the B ink
rate was suddenly raised to 41„ but it is felt that
any Thursday the Mink directors may further
raise it, and again raise it to such a pitch that
even legitimate enterprise may be seriously crip-
pled. The state of things leads us to ask
whether tha powers of the Bank of England are
exactly in accordance with that system of free
trade of which our country now boasts, and
whether it is not desirable that the charter un-
der which these powers are exercised do not
require revision.
, Bank Charter Act, as it now stands, had
the late Sir Robert Peel for its chief propounder
and supporter. How important to us all is this
Charter may be seen by recalling the words he
uttered, in introducing the measure in May,
1844. " There is no contract," he said, "pub-
lic or private, no engagement, national or indi-
vidual, which is unaffected by it. The enter-
prig is of commerce, the profits of trade, the
arrangements made in all tite domestic relations
of society, the wages of labour, pecuniary tran-
sactions of the highest amount and the lowest,
the payment of the national debt, the provision
for the national expenditure, the command which
the coin of the smallest denomination has over
the necessaries of life, are all affected by the
decision to which we may come on that great
question which I am about to submit to the con-
sideration of the committee." He then pro-
pounded hi plan, the substance of which may
be briefly stated. The country owed to the
MIRK of England a permanent debt of some II
millions, while the Government of the day owed
a floating debt to the Sielle establishment of
three millions. Against this aggregate sum of
fourteen millions, the Bank is permitted to issue
paper money to an equal amount, and in what-
ever degree its circulation of paper exceeds tins
debt the Bank is bound to hold bullion. Its ar-
rangement as to the rate of discount are not,
however, regulated by Act of Parliament, but
are made at the will of the directors. The Bank
of England is not, as is rather commonly sup-
posed, a Government establishment, though it
!nanages much of the money business of the I
state. It is really a private establishment, with
its governor, deputy-governor, and directors, a
committee of directors sitting daily, and a court
once a week, on Thursdays. But though a pri-
vate company in one sense it is really a char-
tered corporation, with virtual monopolies and
privileges, under the Bank Charter Act already
referred to. The author of this Act anticipated
extravagant advantages front the measure. The
lamented statesman told the House of Commons
it would "put a check on improvident specula-
tion, and ensue so far as legislation can ensure,
the just reward of industry and the legitimate
profit of commercial enterprise, conducted with
integrity and controlled by provident calcula-
tion." It is very remarkable how these hopes
were blighted. The Act was passed, and in the
very next year --the limons relic ay minis year,
1545 —speculation essullleil the most extravagant
enaracter, throwing discredit even on the most