The Sun.
London, England, 1847-12-01 00:00:00

THE SUN, LONDON.

carted with regard to the Bank Act of 1844 would
Present in itself an ample field for investigation before
the Committee which the House was now asked to grant.
It would be impossible to conceal from themselves that
there had been a very great disappointment in respect to
the results of that Act. He did not mean to say that
the public had not been guilty of extravagant exie eta
eelion as to the change which the measure of Use Right
lion- Baronet the Member for Tamworth was likely to
Produce ; but it was undeniable that hopes had been
distinctly held out, not only by the Right Hon. Baronet
himself, but by almost every gentleman by whom it was
supported, that the effect of the Bill would be materially
to diminish speculation, materially to lessen the fiuctua
lion in prices, materially to contract all violent fluctua-
tion in the currency, and, certainly, materially to lessen
the chance of any future panic or season of distress. The
Right lion. Baronet, then First Minister, and the Right
Hon- Gentleman the Chancellor of the Exchequer, had
been cautious of leading to too extensive anticipations;
and it was also true, that the eminent writer to whom
reference that night had been made had, in his pamphlet
cl9lle much to modify expectations, but that gentleman,
in referring to the former condition of the currency, did
most distinctly refer all former crises to the deficiency
of the law as it had then existed. Well, now the new
legislation had had a trial, and, after all, we had had a
Panic more intense than ever; fluctuations in prices were
extreme, and all the phensmena attending former crises
in a still more aggravated form; and he could not see
that the Act of 1844 had had, in the progress of the
distress, the slightest tendency to give steadiness to the
currency, or to contract it within narrower limits.—
(Rear, hear.) Colonel Torrens, an eminent supporter
of that Act, prophecied that it would preserve us from
those commercial revulsions, those cycles of excitement
and pressure which, as it had been felicitously ex-
Veined, resulted from the alternate expansion and retrac-
tion of an ill-regulated currency ; but it had no such effect.
Many of those who in the last year had fallen sacrifices
to commercial pressure had entertained the belief that
the Act would have carried them through without any
precaution. The Act had done some injury in haring
created among the public an unfair reliance upon the
suepesed securities which it would afford, and to it
might be attributed that mischief which inevitable
flowed from every interference of the Legislature with
protecting objects with commerce and trade.—(Hear.)
Every law affecting to protect commerce, and intending
to impart prudence to the public, had the effect of
spreading among the community a false reliance upon
the Legislature, and, pro tanto, did induce them to throw
aside that self. support and caution which would other-
wise characterise them.—(Hear, hear.) The principle
on which the Bill was founded was, that the circulation
of notes should be regulated by the foreign exchanges.
lie had taken the greatest pains in the world to discover,
by an examination of the evidence laid before that Com-
mittee—by a close examination of the speeches made in
favour of the Bill—and also by a close examination of
everything that had been written in favour of it—and he
must say he had not been able to find ose reason to induce
Into to believe that they either could or should attempt
to regulate the internal circulation of the country by the
foreign exchanges.—(Hear, hear.) There were many
reasons why bankers—not only those connected with
banks of issue, but those connected with banks of deposit
ar well—why bankers of every kind should watch the
state of the foreign exchanges as narrowly as a mer-
chant watched the state of the exports and imports of
the commodity in which he dealt, because the foreign
exchanges indicated the increasing plentifulness or the
searcity or the article in which the banker dealt.—(Hear,
bear-) But, while he disagreed with the Right Hon
Baronet the Chanceflor of the Exchequer in believing
that the internal circulation of the country could be re-
Witted by the foreign exchanges, he was glad to find
that at least he agreed with that Right Hon. Gentleman,
aand with all the Hon. and Right Hon. Gentlemen who
neld his views in support of the Act of 1844—he was
glad to find, he said, that he could agree with them, to
a great extent, on the principles which they pro-
fessed. Ia the first place he agreed with them in
preserving the principle of convertibility next in preserv-
ing a single standard of value; and also in the princile
that whatever
currency was adopted—whether a pureply
Metallic currency, or a mixed curreny of metal and
Paper, it could not be considered as being based on a
sound principle, unless in all its fluctuations and changes
it conformed to that which a metallic currency would
conform to. He admitted to the fullest extent that un-
less it meant that, it meant nothing. He admitted that
a Paper currency could not be maintained by any argu-
ment, unless it could be shown that in all its changes of
value and quantity it conformed precisely to the Changes
which took place in a currency purely metallic.—
(Hear, hear.) He went further, and would say that
the object of every banking regulation should be to
throw the pressure over a longer period—to make the
Pressure of scarcity to be felt at an earlier period, in
oeder to prevent its being felt so severely at a later pe-
,,,ti°l- On that part of the question he entirely agreed
celth the observations of the Right Hon. Baronet the
't_leaticellor of the Exchequer that evening—they had
shown to his (Sir. Wilson's) satisfaction, and he believed
to the satisfaction of most of those who heard him, that
hid the intensity of the late pressure been delayed
i a longer period, by retaining the rate of
uhterest at a low price, it was impossible to conceive
hare extent of disturbance to which the country would
are been exposed ; and, therefore, while he did not
agree with the Right Hon. Gentleman that they could
fog ]late the internal circulation of the country by the
it reign exchanges—or that, if it were possible,
seas desirable to do so, yet in all the great
and essential parts of his argument he cordially agreed
with him. As far as he understood the theory of the
Act of 1844, it was this—that as the exchanges fell the
Bank should contract the circulation, that with the
contraction of the circulation prices would fall, and that
with the fall of prices an export of commodities would
take place ; our imports would be suspended, and thus
the adverse exchanges would be
implied the power on the part
of of
notesthe
regulated. This theory
or expand the circulationat Bankthe
their
ro p
iceoan contract
or
but that they possessed such a power he utterly decnied:
--(Hear, hear.) For, if it did so, it could e only be
1:7 substituting coin for notes; and, that being then -case.
be, for one, would be glad to know how the Bank could
be benefited by an attempt to contract
tftheeirkpnaepertchiar-
t
culation by the issue of sovereign,
some gentlemen maintained that the circulation wof the
Bank of England was represented by the uant-ty f
$
notes issued from the issue department to the banikinng
department ; but he was glad to hear the Right H
Baronet admit that, in his view, ee • on.
their circulation
Meant the quantity of notes in the hands of the public.
The CHANCELLOR of the EXCHEQUER
said it
!night prevent misconception if he explained that what
ne had said was, that under the old law, previous to
.11844, the circulation meant the amount of notes in the
ands of the public, together with bank post bills; but
since that time it meant the notes in the hands of the
and no other (as wo understood).
3.1
I(lnaitinrt.lYglLSON understood the Right Hon. Baronet as
450(4
of
that the word " circulation" meant the notes
vflethe
the public, but whether he had the pri-
gs of agreeing with him on that question or not, he
moat maintain that the word " circulation" could only
Mean the notes in the hands of the public; and if they
te talk of the action of circulation on prices, it
eioeuld appear conclusively
retend that it
that could
the not mean nothing
1. Woues lying
quiescent in the Bank had any effect upon prices ? He
Quaid
it was impossible, in his opinion, that the Bank
~,uauld either contract or expand at their pleasure the
Ateantity of notes in the hands of the public, as long as
weenie notes were convertible—a principle for which they
Tamworth
solely indebted to the Right lion. Member for
evorth's Bill of 1819. He believed that the reason-
trig
Mr. Jones Loyd's pamphlet went entirely upon
In; conception of an inconvertible as distinguished
from a convertible currency. With an inconvertible cur-
. Iteerefuiteunirety ty hey could, of course, increase or decrease tho
cur of notes at pleasure ; but with a convertible
the operation of convertibility was itself the
e of the quantity which the public wou ho.
• It Would be generally admitted that the public never
eltild a larger quantity of notes in its possession than
convenient for the general purposes of trade ; and,
l!tnerefore, if the Bank attempted to contract its circula•
°u, it could only do so by withdrawing
tion a portion of the notes absolutely from eircula-
rary for the
the country.
Performance of the internal transactionnsece Suppose they were to sell 500,0001. of Ltehequer-bills
or any other securities. They would send these to a
broker ; he would go to the Stocko-uli.lchatif,ge and sell
uvepohninithae
them say to five individuals, who et
cheque for 100,0001_ upon his baulterahepoe::i
dbtaiiiiieerence in
taken to the
Bent of England; but that would in
the operation. Suppose the chequeswho wdererewo
Bank of England ; if the parties
the
held any deposits with the Bank the simple operation
would be that their account would be debited with the
cheques. The deposits of the Bank would thus become less
hy that amount, and the Bank reserve would become
more by that amount ; but the circulation would nor be
affected. There would not be a single bank note takeit
nut of circulation by the operation. Then, suppose the
• cheques were taken to a banker in Lombard•street, and
the broker's clerk were to ask for 500,0001. of notes in
exchange for the cheques. It was well known that the
:flbankers in Lornbard•-street were not in the habit of
holding a larger amount of notes than was necessary for
their reserve for carrying on the business of the day ;
and if they found that they had not a sufficient reserve
▪ enable them to pay the 500,000/. they would send the
caeqtlea to the Bank of England, and bring the 500,0001
lintel' back ; so that the transaction would be a simple
transfer of 500,000/. from the securities of tho Bank to
the reserve in the Bank,—a mere conversion of 500,000/.
purities into 500,000/. reserve. It would not affect
Ithhe e circulation one iota, so far as he could discover.
nk„sarnie kind of process would take place if the
-"L of England were determined to increase its cir-
, eulation. The Bank would, in that case, purchase
tcuritisa• They would send their broker to the Stock-
-cuing* to purchase 500,000/. worth of securities,
which he would pay for is notes. It was quite true that for
- le hours there would be 500,000/. more notes in circu-
Uniovrn than there were in the morning; but it was just
as true that the five brokers who sold the 500,0001.
worth
ets
securities would send the 500,0001. either to
their own banker's or to the Bank of Englandin the
afternoon
so that, instead of the circulation increasing,
all. that would be accomplished would be that the Bank
Il added to its securities 500,0001., and diminished its
reservenotes 500,000L—(lear.) He had yet to learn how
_ could be depreciated. Until he saw some reason
ylatteriza man holding a 51. Bank of England note, and
tiezed.
exchanged
it not equal to five sovereigns, could not have it
nagoetd
hfeohrevfievethastovaereologonvse—nhntil he saw that he
couldbin
gladrttleto nhoet es
supported
dp ybe depreciated. He was
this view by Mr. Horner, Mr. Huskisson, Lord Liver-
Pool, Mr. Ricardo, and all the eminent writers prior to
1.844,• a bank note being convertible could not be depre-
ciated, and bank-notes could not therefore be issued in
excess. It was quite true that the Right Hon.. Baronet
Member for Tamworth, in introducing ths Bill, did
rILIOtte several instances where A depreciation took place

notwithstanding the notes wore convertible. The first
case quoted by the ltigl,t lion. Gentleman was that of
the Bank of En.),lan I in 1669, when bank-notes were
depreciated 17 per cant. lie believed, however, that
that was easily exp.a.ned.
Sir li. PEEL-1 merely quoted the reps rt of the
Bullion Committee of 1810, where I found the state-
ment made.

Mr. WILSON sail that in the copy of the Right Ho-
nourable Baronet's speech which he had seen there were
no marks of quotation; but whether the Right Honour-
able Baronet did so or not it was quite necessary that
he (Mr. Wilson) should refer to the circumstance in
order to explain how the anomaly had arisen. In 1669
it was quite true that Bank of England notes were de-
preciated to a large extent; but it was also true that at
that very moment thers was a suspension of cash pay-
ments and the notes were no longer convertible. It
was also stated that in 1804 the notes of the Bank of
Ireland required to be worth 118/. 10s. to command
1001. notes of the Bank of England, showing a deprecia-
tion of 184 per cent.; but it was equally true that at
that very moment there was a suspension of cash pay-
ninnenintsorbnotonh
ninveErtnignileandtbantilid
ilnrella6t69l,. andit
hade
been
stated that the unfavourable exchanges between Scot-
land and England had been rectified by a depreciation
of the notes then in circulation; but the notes in Scot-
land referred to were not notes payable on demand only,
but notes payable on demand, or at the option of the
issuer, six months after date, by allowing interest at
the current rate. These notes, therefore, bore some-
thing of the character o Exchequer-bills now. The
state of the American Bank had also been referred
to, to prove that convertibility was not a sufficient
check against depreciation. Ile must say that
a more unfortunate case could not have been quoted.
The condition of the American Bank was anaiogous
to nothing in the world. It embodied everything that
was absurd in banking arrangements, and was as un-
satisfactory as could well be; but when the banking
system of New York had been placed on an intelligible
and sound footing there had been no more depreciation.
There had not been a single example of depreciation in
New York since 1840, when the Act was passed secur-
ing the convertibility of the notes at the pleasure of the
holder. Tao case of Russia and the other cases which
had been referred to were explained in a similar manner.
In his mind there was nothing more clear than that the
law of 1819 afforded the most perfect security against
depreciation. Now he must show that it was utterly
impossible the Bank of England, in case of an advance
of the exchanges, could contract the circulation. Sup
pose there were an advance of the exchanges trot), an
increased price of food, from a deficient harvest, from
an importation of grain, and au export of bu lion—what
took place at home? The circulating medium was
measured by the price of the commodity we had to
dispose of, and the number of transactions we had to
perform. If the prices, therefore, were rising at home,
how was it possible for the Bank to contract its cir-
culation at the very moment when increased prices
and increased transactions required a larger propor-
tion of the circulating medium than when prices were
low ? Another reason why the Bank could not contract
its circulation was, that in every case where inconve-
nience was felt for want of a circulating medium, the
vacuum would be supplied by checks drawn upon the
deposit department—so that a bile there was a bunk of
issue and a bank of deposit, it was quite impossible to
contract the circulation. In the autumn of last year, on
the 29th of August, the amount of bullion in the Bank
of England was 15,366,0001. ; the circulation in notes,
bank post-bills, and bills of exchange, was 21,311,0001. ;
the securities in the Bank of England amounted to
24,804,0001., of which only 12,500,000/. were bills of
exchange or private securities. At this period, from
causes which had been described by the Right Hon.
Baronet the Chancellor of the Exchequer, owing to the
high advance of exchanges against this country, week
after week and month after month, the bullion in the
Bank gradually declined, and on the 3d of April 1847, the
bullion in the Bank of England had sunk from 15,366,0001.
to 10,246,0001., and the circulation of notes had dimi-
nished from 21,311,000/ to 20,815,000/. But the se-
curities had risen from 24,000,0004 to 30,000,0001., of
which (and lie called attention to this fact) the private
securities amounted to 18,627,0001. Keeping the eye
upon these two periods, and recollecting that the bullion
had sunk 5,119,0001., he found that, notwithstanding the
operation of the Bank Bill of 1844, the circulation had
sunk only 4,960,0001., but the securities had increased
5,260,000/.; and the increase of private securities had
been no less than 6,000,000/. sterling; for, during the
whole period, notwithstanding the extraordinary drain
of bullion, the circulation, instead of following the bul-
lion, diminished only 16,960/. But he found that,
during that period, the number of bills under discount
was increased by 6,000,000/. sterling. These bills re-
presented in the first instance an issue of Bank-notes ;
there being more bills carried to the Bank from August
to March represented an issue of Bank notes; but it was
clear that, although there was immediately an issue of
notes, those notes retursied to the Bank ; for the circu-
lation, instead of following the drain of bullion, under
the operation of the Bill, was kept up by the increase of
discounts upon bills or private securities. He believed
that on these facts we saw the fundamental error which,
in his opinion, was contain ed in the Bill of 1844. He
believed the fundamental error in the Bill was this, that
those by whom this Bill was framed had confounded cir-
culation with capital and currency with bullion. For
the currency was the amount of the circulation of the
Bank of England, and not the amount of the capital at
the command of the public by means of discounts.
Therefore he believed that the restriction which that
law had imposed upon the circulation of the country was
unnecessary in so far es the convertibility of notes was a
sufficient guarantee of excess or deficiency, and tended
to withdraw public attention from what he believed to
be a more impoi tent subject of consideration—the
amount of reserve or capital, and not the circulation of
notes. If attention had been directed to the deposits in
the Bank, the ordinary considerations of prudence in the
conduct of private affairs would have mitigated, if not pre-
vented, the late crisis. Fortunately, we had two means
of knowing the fluctuations of the deposits in the Bank
of England. The Bank Committee, in 1840, had col-
lected some very important and useful documents; they
had obtained from the B.,uk of England and the Bank
of Ireland returns of the wr slily state of the deposits for
a number of years. The returns of the Bank of
England were divided under different heads :—pub-
lic deposits, and private or other deposits; of which, first,
there were those of the London bankers ; secondly,
those of the East India Company ; thirdly, those of the
Banks of Ireland and Scotland ; fourthly, other de-
posits, including the private deposits of merchants ; and
lastly, those of the different branch banks in the
country. For obvious reasons he excluded from his
consideration the Government deposits, as they were
regulated by other circumstances than those connected
with the state of commerce or the interests of trade.
He rejected also the deposits of the East India Com-
pany, as they were not governed by the same principles
as those which applied to trade. He excluded likewise
the securities deposited in the Bank of England belong-
ing to the Banks of Ireland and Scotland. He had
constructed a table from these returns. It would be
in the recollection of the House that the year 1838
was a year of fair, good, ordinary prosperity ; that in
the latter part of the year we had recovered the panic
of 1837, and the bullion in the Bank of England had
increased from 4,000,000/. to 10,000,0001 ; and there
gas an impulse given to our trade, so that the year 1838
was a year of as fair average prosperity as any year that
could be mentioned. In the early part of 1839, in cense-
4:pence of a bail harvest, there was an importation of
grain and efflux of bullion to such an extent, that the
country was in a state of extreme depression, and the
Bank of England was obliged to have recourse to the
Bank of France for assistance. Therefore he had col-
lected materials for a comparison of the state of the de-
posits during the last quarter of 1838, representing a
period of renewed average prosperity, and the last
quarter of 1839, representing a period of pressure. fie
did not think it fair to take the weekly averages, but the
average of the whole quarter, and he found this result:—
the eves age weekly deposits in the Batik of' England of
the London bankers, in the quarter from October 1 to
December 31, in the year 1838, were 812,000/.; in the
corresponding quarter of 1839 they were 615 0001. The
private or other deposits in the Bank of England, in the
last quarter of 1838, were 3,020,000/.; in the last quarter
of 1839 they were 2,122,000/. The deposits of the
branch banks in the last quarter of 1838 were 592,0004;
in 1839, 451,000/. In the Bank of Ireland the private
deposits, in the last quarter of 1838, were 2,234,0001; in
1839, 1,834,0001.; and the agency deposits in 1838
were 486,0001, and its 1839, 391,0001. The
totals of the different items were, for the
last quarter of 1838, a year of ordinary
prosperity, 7,144,0004 ; and in the last quarter of 1839,
only 5,413,0004, showing a reduction of 25 per cent. on
the deposits available for the giving public accommoda-
tion between these two periods. Now, ho asked what
was the nature of the banker's trade ? His profits were
derived
from disceunting bills at a high rate of interest.
The only funds from which a banker could discount
bills are of three classes: first, his own capital; secondly,
diterpoissibtsa.nklwt awsaas
in
bank
hofoiswseure,ofhibsacnikrceruslattotogniv;ethirdli
accom-
modation upon their deposits ; but if in these banks
there was a diminution at this period of to less than
1,700,0004 in the amount of deposits, which were re-
duced in one year from 7,000,000/. to 5,000,000!., what
must have been the proportionate reduction of the
deposits
empoousai
fts ooff th e depositsb banks
o kisnoaflsl
period ? What must havecth e banks
ol a
beenod.of London at this
that they extended to 30,000 t ,000/ stering ? Why, in
the same proportion, would whent e
irtewd ua cstri
eocno tt he
de
the total. i
amount of deposits
in the Scoth banks be greater or less according to their
number, as compared with the banks ofEngland. The
number of banks in the united kingdom extended to 1,600,
and, if the same reduction should have been made in their'
deposits, we might well conceive the cause of the ex-
treme pressure felt at that period, from the reduction of
the means of the banks to accommodate their customers,
their funds being exhausted. But, if such were the
effect produced only by a bad harvest in 1839, what
consequences might it not be conceived that such a re-
duction would produce when not only had there been a
severe drain upon the country for grain, but a large rail-
way expenditure had been added ? What might be ex-
pected to be found if the Committee should obtain an
account of the deposits throughout the country, and the
decline in the amount during the present year ? He
believed that, reckoning the number of bank' rs at 1,600,
we could not reckon the aggregate amount of deposits
at less than 200,000,000/. Reckoning the number of
t of deposits at
banks in Scotland at 400, and theor
amount
tneach bank. He
30,000,000/., there would be 7
t th(e United- Kinedoin, for
higher than in other parts o
bunks were authorised
considered the total amount. 5 04
deposits in Scotland
an obvious reason. The Scotch
by law to receive trust
than in other parts of the
monies, and, therefore, the
amount of deposits was larger
amount of depo-
United Kingdom ; but he believed that, though the num-
ber of banks was greater, the average
sits at each bank in the United Kingdom was greater

then the average amount of each of the scotch hacks.,
Now, he might Ise asked, what purpose he intende t to
carry out by asking the banks to keep an eye en he
state of the foreign exchanges. The purpose was 4b-
vious, that the banks might know, by keeping th it
eyes on the state of the foreign exchangeF, vvh.t e
likely to be the drain on their deposits, and what e
• likely to be the demand on their capital. If tin- liink
directors directed their attention to these points; if ,hey
looked to the rate of foreign exchanges; if they lo
their money like any other commodity, and if they
raised the rate of interest at an early period a iLi.out
looking at all to their circulation, but merely to the
loans and discounts which they were r«luired to rusks,
he believed that they might, by thus raisince the nee of
interest at an early period of the drain, inducen the to
beneficial results, and altogether prevent the recur' secs
of that pressure which the country had already ft-!t
disastrous.—(Hear, hear.) He believed that if Ills link
of England, instead of', as in the mouth of August .t,
leaving the rate of interest at three per cult ,
it in the mouth of January to four per cent., and eely-
in the month of Apiil still further increasing it, eh, n
week after week their capital had been ditnieh,eine
until it was reduced by the amount of 6.000,0001 —if, he
repeated, the directors of the Bank had raised th, it
rate of interest at an earlier period, he believed that the
commercial interests of the country might have get
through the crisis with much less inconvenience —a vete
of interest perhaps high, but not nearly so high as it
was afterwards necessary to fix, in order to restore the
exchanges.—(Hear, hear.} He was not sulliciently san-
guine to believe that anything that Committee coul.i de
would entirely prevent the recurrence of such a crisis ;
for as long as they had the variations of seasons,
long as they had hope and fear to contend with in the
human heart, and as long as they had ,peculativ., i x-
eitements and prosperity at one time, so long would they
have periods of depression and of distress at other times.
He was not sanguine enough to suppose that anything
that House could do would entirely prevent a recurs once
of these periods ; but he was sanguine that they would
give the public the fullest information that could be
gisen ; thus, much more than by Acts of Parliament,
they would be taught to regulate their commercial
transactions ; they would have placed within their
reach the information which would teach them to

mitigate the evils of these periods of pre!, ure.
He did not say that the removal of the evils would to
rapid or immediate ; but he trusted the information
which would bo obtained by the Committee would uid in
restoring confidence, and would gradually lead to pros-
perity unequalled at any former time. lie could not
forget the extraordinary expenditure which had been
. .

going on within the last three years, and if the Act
which they were obliged that session to entertain—it the
Bill which the Right Hon. Baronet introduced the other
night, was to be considered one of the means of checking
the present large consumption of capital, that Act, how•
ever necessary it might appear to be, would, i❑ the first
place, have a bad effect on the commerce of the country.
It would have the effect of throwing many persons out of
employment who had been engaged during the last few
months, and :in receipt of large wages, arising tr.,m a
large expenditure, during the construction of large
works, but immediately that these works ceased, and that
the expenditure was withdrawn, then was the reaction
felt in all the branches of commerce, and they might
look forward to a period of considerable depression. Ile
had the honour to propose an amendment to the notice
Web was proposed by the Right lion. Baronet, namely,
that all the words after the word "inquire" be ()mated
for the purpose of inserting the following words how
far the recent commercial distress has been afK.cteil by
the laws for regulating the issue of notes payable un
demand."
Mr. BROWN seconded the amendment.

The question having been put,
Mr. T. BARING acknowledged that many errors ha I
been committed by all parties, but he would not admit
that the pressure was entirely attributable to over-tra4-
ing or want of capital. Blunders had been imputed tti
the Bank of England, but, like all other large estuldis!l
ments, he would ask where was there a mercantile house

in which a variety of errors might not be pointed out ?
The Right Hon. Gentleman (the Chancellor of the Ex-
chequer) had stated that the Bank of England ha,l been
guilty of blunders ; but the Right lion. Gentleman
should not have forgotten that he had himself over-
traded with the interest of the country by leaving a
large amount of Exchequer-bills in the market withyut
demand for them, and at a disgraceful rate of &noun .
The Right Hon. Baronet had committed so many bun
ders that if he had been a small trader his condue
would have been sufficient to warrant his name being t ut
into the Gazette.—(Laughter.) He had negleettil to
make any provision for the large amount of Exchvg•ter-
bills due last March, although ho should have known
the demand for bullion that must follow from the atute

in which the country was then in. There wore ,/rious
intimations made to the Right Hon. Baronet as to the
state in which the monetary affairs of the country were.
but he had totally neglected to make any provi-ion
against its consequences. The want of foresight di,l not
exist alone amongst the traders of the country or the
Bank of England, but in the Right Hon. G, ntl, man
himself. The pressure was attributed to over. tra.iing
in corn. There was undoubtedly over-trading and gri.a
speculation in corn, but that was not the sole cause -he
Majesty's Government were not free from blame. Al,
inquiry was not the remedy for:the blunders commit:, d
they should have dozens of different opinions. 'Fri,
result would be, the evidence would be published wic how
a report, and the Right Hon. Baronet would take the•
recess to consider what was best for him to do

(Hear, hear)—thus leaving the country in the saint .tat,
for the next year and a half that it is in at present.—
(Hear, hear.) Nothing could be more unsatisfactory
than such a proposition as that made by the Govern-
ment—a Committee of Inquiry ! Why, the country
had been sitting as: a committee ; their pressures and
their sufferings had been a committee, and from them
the staie of the country, and the operation of the Act
of 1844, which the Right Hon. Gentleman himself had
supported, hud been learned. The Right Hon. Gentle-
man might know from experience that the Bank of
England would not fix too low a rate of interest
The effect of fixing eight per cent. as the mini:nun
rate of interest was, to alarm a great portion ot ihe in
dustrial community, and if money could not be pr,eure
at a lower rate, it could not be expected that the manu-
facturers of the country would be able to i'svcut,
foreign orders.—(Hear, hear.) They could never curt)
en a profitable export trade with a rate of iuturest st
high as eight per cent., and if such a rate ot inserts
was to rule, they must expect to see a great diminittiot.
of that export trade on which they must rely, no,
merely to pay for gold, but also for the increase in th,
foreign debt which had arisen from the facilities given
by their recent legislation to foreign imports.—(Hear,
hear.) They had afforded the foreigner many a.ivan
tages of late, and if by any measure they prevent, 41 thy
manufacturers of this country from obtaining money at
a cheaper rate of interest than the foreigner, he be-
lieved
hi c the h they
would
manufacturingsacrifice
age
w
wouldll,
assurancenot go into Committee
her
Commilatelejeswtps Ghout
some obtaiuint
as to what they intended to do in case a siinilai
crisis occurred again, or to what extent the)
would suffer it to proceed before they would of
ford relief.—(Hear, hear.) He should desire ti
accompany the resolution with this appenda.;e—
-" That that portion of the Act of 1844 which rt-

stricted the issue of note■ to one-fourth on silver, and
14,000,000 L on securities, should be suspended, and :et
to the discretion of the Bank and Government united

till the Committee made their report."—(Hear,
There could be no hope of a report early enough ob
which to found an immediate measure, and the opel
tions of the commercial world would remain Uncertain
unless some such measure as he had suggested .s
adopted, or some declaration were made by the Govern-
ment as to the course they would pursue in ca.e
similar crisis arose again. The Hon. Gentleman v% ho
spoke last said that a double standard was not corn

patible with security. He (Mr. Baring) denied that ;
for there existed such a double standard in the Unite 4
States and in Holland, both commercial countries.—
(Hear, hear.) They might have a double standard i;
this country, and though it might be attended with
some inconvenience and expense, these evils would h.
light in comparison with the differences which had
taken place this year between the value of capital I,n,
money, which were enough to ruin the commercial
world.be sai
to
ole didbe s
ant
ios tfa
et
thoin the
ryk
toi t
smperaos
mu roe of 18 t e
rs ;444,,
ac.o
~1101.1
satisfactory to the country, and under these circuin
stances it could not be satisfactory to the House
(Hear.) He trusted, therefore, that the House would
not think it shelved from consideration by the appoint-
ment of that Committee.—(Cheers.)
Mr. ROBINSON said that the motion of the Bight
Hon. Gentleman the Chancellor of the Exchequer %%as a
tacit admission that the law respecting the curr,ne.)
required revision, and that the system of free trade
proved a complete failure. He agreed with his lion.
Friend who
,just addressed the House that un inquiry of
this kind, without restriction or limitation, could lead to
no practical result. He could see no end to the proposeo
inquiry, and would prefer two Committees—one to in
quire into the operation of the Act of 1844, and the
other to inquire into the effect of their late Ire, trail,
policy. To that policy he was disposed to ascribe th.
evils which now afflicted the country, and the only re
source for surmounting them was a recurrence to the
principle of protection. He was, on principle, in favour
of a property and income-tax, but he would oppose it
unless the Government pledged themselves to reuse(
their steps, and to go back to the system of protection.
de did not think the Government was to blame for in
terfering as they did with the Act of 1844, but he
thought they were wrong in not interfering sooner.—
(Hear, hear.) He hoped that if a Committee was ap.
pointed it would be composed of those Members who
had the greatest knowledge of the subject; but, ut the
same time, he could not see the utility of inquiry. Nu
blame was, he thought, attributable to the Bank f..r th,
course pursued ; it was the system that was to Wattle.
The currency was totally inadequate to the demands of
the country, and until that evil was remedied there !nub•
be periodical crises. A great error was committed
1819. At that period it would have been much wiser t
have restored the old standard—viz., gold and silver, in
stead of making gold the exclusive standard, and will
precautions against their running into excess, small
notes might have been allowed to circulate with ben( fi:
to the country. As regarded free trade, be min.t
that there was no disposition on the part of for,ign
Governments to follow our example in that respect.
his amateur trip on the continent, the lion. Member
for the West Riding of Yorkshire (Mr. Cobder ),
every one of the large commercial towns which he
visited, had been well received by a class of merchant,
who were interested in obtaining access to our mar Lets,
but who had no sort of influence with their ewn Go
vernments, as well as by philanthropists who lived in a
world of their own creation.—(Hear, hear.) The Hon.
Member could not refer to a single change in the tarn IF
of any country as the result of his mission. In conch'
sion, he would observe, that he did not regard with ap-