The Sun.
London, England, 1841-01-16 00:00:00

EVEN /NG EDITION.

at all. In the first place the issue or amount of paper
money should be equable under all circumstances, un-
less when reduced or amplified by the milowing or out-
/inuring of gold, that is, the regulator should be the
foreign exchanges, and the reduction or amplification
contemporaneous with and contingent on the stock
of bullion in hand. This results naturally from
the position, financially as commercially, of the
country. For it 13 very easy to make laws de-
claring Bank of England piper legal tender, and in-
vesting other bank paper more indirectly with the
same privilege, but however stringent may be these
laws here they are entirely inoperative in all other
couctries with which exchanges have to be made, and
which exchanges of values have to be determined and
measured by the common law of conventional agree-
ment about the money standard. There must be
fixed principles about paper money, if it is to represent
value, as there is about gold and silver, whose value is
contingent on quantity and production. The only basis
for paper money is the amount of gold which is its
substri.tum, and the criterion of the comparative value
of gold is the product of the gold mines above or be-
low the waste or luxury of the country. Mr. Gilbert,
in his essay on Banking and the Currency, in the
Westminster Review, sticks to the unlucky theory of
the advantage of paper money in the sense of its easy
contraction and expansion, according to circumstances
or bank interests. The city editor of the Chronicle
speculates in the sense that the Bank should " force"
up or force down prices, as a principle of action. Ex-
pansion or contraction of currency, however, dependent
on individual or corporate will, is about as mischievous
as the idea of a bank charged with the management of
the circulation, regulating its issues with a view to force
up or force down prices is eminently absurd and would
b.: most disorganising.

CH RON IC LE.—The favourable turn in the Fo-
reign Exchanges manifested in the early part of the
week has, on the whole, been maintained to-day, and
expectations are entertained that a considerable im-
portation of the precious metals will be received from
liamburgh when the navigation is re-opened. It is
further antisipated that our export trade will evince
unusual animation this year, causing a material increase
in the revenue. These anticipations have led to the
belief that the Chancellor of the Exchequer may be
enabled to dispense with a loan, and that the Bank
of England will relax their stringent action on the
currency. The sales of the Saving Bank money,
which we have noticed lately, are said to have
been made on account of the Chancellor of
the Exchequer, and it is probable that he
may, from time to time, supply his wants from that
source, until he sees how the important negotiations
with the Chinese empire are likely to terminate. These
favourable circumstances have been much looked to,
and have induced a strong impression in favour of spe-
culations for the rise. They are no doubt flattering,
and by no means unlikely to be realized ; but until
the bullion in the Bank is more than 5,000.0001., instead
of 3,511,0001., we do not see that the Directors could,
with propriety or safety, encourage an advance in
prices by an expansion of the currency. We must not
shut our eyes to the fact that various foreign states are
watching our Money Market narrowly, ready to come
forward with proposals for new loans so soon as they
find a suitable opportunity. . . . . .

A private letter from Chinn has been received by an
eminent house connected with the Canto❑ trade, of the
15th October, being several days later than any other
despatches brought by the last overland mail. This
communication confirms the intelligence that Commis-
sioners had been appointed by the Chinese Govern-
ment to proceed to Canton, in order to enter into nego-
tiations with Captain Elliot for an amicable adjustment
of the differences with Great Britain.
This was settling day in the Consol Market, but
although the extreme fluctuations have amounted to
about 3 per cent. during the Account, it was by no
means a heavy settlement. The continuation to-day
fell-off to 3-16ths to per cent. for the February Ac-
count, showing pretty clearly that the jobbers were
Bears of stock.

Supposing that a clause in the Act of renewal of the
Charter of the Bank of England, binding the Directors
to manage the national currency on fixed principles
would be effectual ; that there would be no departures
from it on account of extraordinary circumstances ; and
that no bills of indemnity on account of extraordinary
aid to commerce under pressures would be sought for
from Parliament, we ask the people of this country,
should such an arrangement be approved of by their re-
presentatives in Parliament ? Would it be conducive
to the prosperity of the trade and commerce of this
country that the Bank of England should retain its
privileges as the national bank of issue ? or should
those privileges be enlarged by making it the sole bank
of issue ? If the first question be answered in the
negative, it solves the second ; therefore we shall con-
fine our observations to the first ; and we say that the
functions of the Bank of England, as a bank of national
issue, ought not to be continued, because they would
he more prudently and beneficially exercised by
officera under delegation from the Crown, subject to
the supervision and control of the people through Par-
Why should the country or the Crown abdi-
ate the sovereign right of furnishing the coin of the
realm to individuals, and allow those individuals a
profit upon the paper money which they put into cir-
culation ? It is giving encouragement to the absurd
principle of allowing those individuals to create capital
at their pleasure, to increase or diminish it as they may
deem expedient, and, by merely fixing the proportion
which their paper shah bear to their bullion, we should
only put a limit to their power of mischief ; we should
not eradicate it ; it is a false principle of action alto-
gether, that of allowing individuals to issue paper
money-. The coin of the country is made at the Mint.
'Y he Bank of England must send their bullion there to
be coined, and the Mint should be the place from which
all tie money of the realm, whether gold or paper, pay-
Ahlc in gold, should take its origin. Reduce, then, the
al;nwance to the Bank of England for paying the di-
vidends within moderate terms ; pay off the debt due
to the Bank by the Government ; constitute an al.
cient Crown board of issue, and the whole business of
coining and issuing money might be consolidated, and
better and more economically managed, under the di-
rection and eyes of Parliament and the public. It may,
perhaps, sound rather unpleasant to cars polite to men-
tion such a work a* the " Black Book." We never-
theless, take the following extract from its pages. The
sitehor, alluding to the benefits expected front a reformed
Parliament, says—" A national currency would be is-
sued under the control of the Legislature. Private
individuals, who offer no security to the public, would
no longer be pe;mitted to issue bits of paper as repre-
sentatives of real property. Fluctuation in the cur.
rency would be guarded against, and the value of
money rendered secure and uniform. But tlis is not
all : an immense saving would accrue to the commu-
nity. We have seen the bankers gain three millions
annually by the issue of their notes. The same clearly
belongs to the State rather than individuals. If a
paper currency be unavoidable, let the public have
the benefit of it." There is much strong sense in
riles° remarks, and they point clearly to the true quar-
ter—the additional security and uniformity which
would be obtained by a national currency, issued under
Parliamentary control ; we should no longer be alarmed
with mysterious accounts of runs for gold upon this
bank or that bank ; panics from such causes would
cease ; the country banks would have no issues except
the legal money of the realm, and if they should over-
trade, or enter upon speculative transactions which
caused them to declare insolvency, there would be no
ruined holders of their notes to swell the list of bank-
ruptcies. Every banking company of the country would
issue the Queen's coin, or the Queen's note, the repre-
sentative of, and convertible into, coin, and no other ;
the coBntry would enjoy additional security ; commercial
enterprise would be entered into with increased confi-
dence ; and trade would be more prosperous and safe ;
we s dno longer be racking our brains in vain eon-
jectu ss to the policy of the Bank parlour ; that se-
cret and really irresponsible tribunal would no longer
exercise capricious control over the property of their
fellow-countrymen ; everything connected with she ma.
aagement of the currency would be open
and above-
kard ; and the proceedings of commercial men would
ve fair play.

POST.—The Hampshire Banking Company, a joint
stock bank, having its head office at Southampton, is,
we understand, on the point of coming to an arrange
latent, if, indeed, it has not done so already, with the
Bank of England for the withdrawal of its own notes,
and the substitution of those of the latter establishment.
The precise conditions under which this arrangement
takes place need not be stated. The present case o:
junction, or coalition, between the Bank of England and
a joiat-stock company is worthy of some attention, as it
appears to be the first in which a bank in an exclusively
agricultural district has been concerned.
This was account day in the English stock market.
It proved a decidedly bear account, and the differences
of the speculators and jobbers being disposed of, all of
thee satisfactorily as fir as we can learn, the quotations
:unproved materially. Money was found to be suffi-
ciently easy for all purposes connected with the opera-
tions of the market, though in Lombard-street it cannot,
in the existing state of affairs, be over plentiful.
The intelligence received in the course of the day
from Madrid, respecting the good intentions of Senor
•Gamboa, looks flattering, more particularly for the
Molders of the indemnity bonds, but nothing was done
la those securities that we arc aware of, and the decline
%Alicia occurred in the Actives, in the face of his Ex-
ceCeney's promises, seems to indicate but too plainly
that oo great faith is placed in them. The knowledge
that Senor qiinaboa has the well-known trickster, Men-
dizabel, at s elbow, the author of the dishonoured
'Treasury hills, and issuer of spurious securities during
a suspension of payment of the dividends, is certainly
aware than enough to explain the excessive distate that
Naha been created for Spanish securities, whatever their
dtveornination.
'figs correctness of the announcement made by the
man sgers of the telegraph at Brest, with respect to
the tfettleraent of the Buenos Ayres question, being
by the French Government, a hope is ex.
confirn-O