The Express.
London, England, 1847-10-21 00:00:00

Jog

ghe eplinoo.

The swesisall awed -le, eie meivelllee, te the Mediewreaeso,
=.4.2.=4„,... Moos Nov, he., will be vie op in the
t=7azne
wirrlin• I; Torttt.e Irthhaggelre. WI; IDA Olken,
The so
ke New Owlh Vita Mom% Laril. sal Ni.
Zarswid 1.11 Ile pale op ea She Otis lot Illystakse.
The Ws* bile min. Wing thous Mr Mods% anew% NA
Iles Nioomhosllll le mks op ea ihis malopeithe Sol Ilvwssabse.
The weselool was Ow Olbsolior Malta. Owens lir kin Ides"
Estyp4.A/shpleetleas.liosokassir Mr. els imilimploo,
will lei ris sip es tie preolog et the Nwessabor.
he
Illidis Pr Wish See* Mod as, Beneada, seel She WWI
Outs% TM be ark up so Ihe ~Ye of the Sol Nawmksh.
The nib Ow Yr Bea& die Um Plate
111 l , Mbar tides, fern=
,b:=.2zArge.overabirift"...

•.•
at Jo Oar. Ift

TO CORLISPONDINTL
laireed Mr Th. igloo^ Were rear err le
Beretrateer by Tee rear r the er .lam
ee**.

WWI Win% AT LONDON.III/DOIL
D‘T-11ff.lac oala. paV aftareaaa. 0 ob. ma 0.
TaJleaaci • —Karam. aka. pea 0 Anevaaa. 19 AA. Ma 11.

LONDON, THURSDAY, OCT. 21.
Toe grand plea for ministers doing nothing towards
the restoration of credit and monetary ease is, that
even those who demand remedies are not agreed or
clear-headed on the subject. We do not think that it
is of such very great importance to decide how the
support is to be given ; the grand point and the use-
ful thing being the fact, that government will step
forward. The assurance and certainty of that would
alone work wonders.
Our weekly contemporary, the Economist, seems
to be of opinion that any relief which could be gained
by a relaxation of the Bank Charter Act of 1844
would be at the cost of the safety of the position of
the Bank of England, by a diminution of the amount
of bullion which it would hold, in exact proportion to
the relief afforded. The argument is thus stated :
" That were the Bank Act of 1814 relaxed to-mor-
row, so as to enable the Bank to issue notes against
government securities to the extent of sixteen in place
of fourteen millions, not a single pound would thereby
be added to the circulation. The operation would be
this. The Bank would be entitled to issue 2,000,0001.
more. In order to do so bills of exchange would be
discounted tu that amount, and notes would be issued,
but the notes not being required for circulation would
be taken to the Bank and exchanged for bullion, and
in a few days the simple effect of the change would
be, that the Bank would be found with less bullion
by 2,000,000/., and with more securities by that
sum."
There is no argument to prove why this effect
should take place—nothing but the assertion of the
editor of the Economist, that " when parties talk of
increasing the amount of issue above fipirteen millions
on securities, it really means that the reserve of gold
held as a guarantee for the notes in circulation, should
be diminished."
It is of great importance that the public should not
be misled as to what the real effects of such a mea-
sure would be. We shall therefore endeavour to point
out briefly, what the working of the relaxation of the
act of 1844 would be in practice, giving, at the
same time, as concisely as we can, the rea-
sons why the results would be such as we
are about to state. If a relaxation to the extent of
2,000,0001., as suggested in the Economist, were to
take place, the effect would be that the amount of the
reserve of notes in the banking department would at
once be raised from 3,321,700!. to 5,321,7001. The
immediate consequence of this alteration would be
such a change in the feelings of all those whose busi-
ness is the distribution of capital on mercantile
securities, that the great discount houses, the
doors of which are now all but closed against
even the most unexceptionable securities, would
again enter into competition with the Bank.
The next consequence would be, that the
private and joint-stock banks which have been
preparing for a storm, by providinq themselves with
larger reserves both of Bank of England notes and
coin, than their experience has taught them that it is
necessary or desirable for them to hold in ordinary
times, would find that the times no longer looked so
threatening. The notes and the gold would both find
their way back to the Bank of England ; confidence
would be restored; the rates of interest and discount
would fall; our markets for produce would cease to be
depressed below the natural range of prices ; the pro-
gress of manufactures, i. e., the creation of wealth,
would be resumed, instead of being in course of stop-
page as it is now; and trade would gradually return
to that healthy state which does not exist now, only
because of the insane adherence on the part of our
rulers to the absurd provisions of an impracticable
law.
The editor of the Economist asserts that the Bank
would discount more bills to the extent of 2,000,0001.,
if the issue department was allowed to hand over to
the banking department notes to that amount. We
have given a sufficient reason to show that in all pro-
bability the Bank of England would discount fewer
bills, if such a change were made; namely, because
that change would at once bring the bill discounting
houses again into competition with it, whereas
now, nearly the whole business of discounting is
thrown into the hands of the Bank of England,
which would be glad to be relieved of a
portion of it. But even were we to grant
that the consequence of the supposed change would
be that the Bank would discount more bills to the
full amount of 2,000,0001., still it would by no means
follow that Fold would be taken out. For what pur-
pose would it be taken out ? It would not be taken
out for exportation, for the exchanges are all the
other way, and there would be a certain loss on the
transaction. It is not likely that it would be taken
out to increase the reserves of private and joint-stock
banks, for we have already shown that the effect of
the change would be to allay those fears which
have caused these banks to increase their re-
serves beyond the proportion which they usually
think necessary ; and besides, if it bad not that effect,
these increased discounts would not add to the facility
which those who require such reserves already pos-
sess for increasing them, for it would not alter the
rule of the Bank, which prevents it from discounting
bills endorsed by other banks of issue.
There can be no more convincing proof of the ab-
sence of any real danger to be apprehended from the
relaxation of this law, than the chimerical nature of
the objections which are raised against it.
The writer in the Economist, in common with Sir
C. WOOD and many other excellent persons who deal in
theories about commerce, misapprehends or misstates
the connexion which exists between capital and cur-
rency. Capital is net bank-notes or pieces of metal—it '
is the things necessary for the comforts and luxuries
of man. A capitalist is a person who poesesses a
great quantity of those things, or the means of pur-
chasing them. Money is useful only as a means for
facilitating the interchange and production of wealth;
and currency is a structure o credit, based upon
money, for increasing its usefulness, as a further
means for carrying on the industrial operations which
produce this wealth. A diminution in the quantity
of money used by the industrious classes destroys
credit or currency to an enormous extent, thereby re-
moving the ability to continue the production of
wealth. Wealth, therefore, or capital, becomes dimi-
nished in proportion as men consume what is required
for living, without a corresponding exercise of their
labour in producing commodities. Such theories as
those advocated by the Economist, first destroy ca-
pital, and having done so, they say that " want of
capital" is the evil from which we suffer!

Viz proverb says that "facts are stubborn things,"
but the stubbornness of facts is as nothing against
the slipperiness of words. The fact can be grappled
with, taken to pieces, turned inside out, accepted for
what it declares itself to be, or kicked out of an argu-
ment as an impostor. It may be stubborn, but it is
palpable. The word defies the hold of reason, as the
image in the concave mirror mocks the grasp of the
1 It presents itself with an imposing solidity,
but there is nothing to seize. It seta itself up against
every fact, professing to include all facts of the class.
It leads disputants away like a Will-o'-the-wisp.
Hurl a clinching syllogism at it, and it opens to give
it passage. Array a safe line of deductions against
it, and it disappears, like the mirage before the thirsty
caravan. The solid reasoner on facts is as unfairly
matched against the airy brand Sher of words as
BUCEACD against ABD-EL-KADEK. The one carries
baggage and artillery, the other appears and vanishes,
light as the wind, with neither.
The trouble which " word? occasion is unluckily
proportioned to the importano.° of the question in
so
which they appear. In none helve they sho
distractiwnon
mischievous an activity, or caused such