The Sun.
London, England, 1848-02-18 00:00:00

and the 30th of October there was an increase of notes
to the amount of 2.754,0001., and of gold coin issued to
I the public of 2,202,000/a making together 4,956,000/. ;
and yet money was not to be had under 17 or 18 per
cent. It was that monstrous discount which brought
down so many houses. But this was not all ; for, as
the value of money increased, the price of produce fell.
—Meal-, hear.) With regard to speculation in the
commercial world, if they looked to their imports, with,
the exception of sugar, there was not a single article in
excess ; and what were the particular circumstances of
the case ?—(Hear.) They had just made great altera-
tions in the duty—(Hear, hear)—and the Chancellor of
the Exchequer had said that the vastly increased impor-
tatiou and consumption would help to supply the defi-
ciency in the revenue. Was not there, then, great
inducement held out to merchants to import sugar
largely ? As to corn, at the beginning of the year the
Government were importing it themselves; and, in con •
sequence of the high price, questions were being raked
in that House whether the Government had considered
the expediency of paying a bounty on its importation?
Further, a day of humiliation was appointed on account
of the distress with which the country was afflicted; and
what was the consequence? All these things made the
British merchants ransack the world for corn—(Hear)
—and, instead of being abused as they had been, they
were entitled to the gratitude of the country.—(Hear,
hear.) The average price of wheat in London was in
May, 1547, 105 s. per quarter; and in August 51s. Such
changes
,baffled all calculation; but ho contended that
no man ought to be called a speculator who imported
goods for the market, taking his chance of the prices—
, that was legitimate enterprise, which British merchants
had always followed; but he was a speculator who
bought up articles of necessity and general consump
tion, and stored them for the purpose of keeping them
out of the market, diminishing the supply, and raising
the prices. The promoters of the Bill of 1844 had said
that if it did not prevent, it would mitigate panic. He
would take no blame to himself on account of that Bill
because he had opposed
,it from the first, and had yen'
tured to offer his opinion that it would produce very
mischievous effects. They had been told that as the
bullion came in the Bank would issue notes, and as it
went out the Bank would contract its issue of notes; but
that had been found wholly impracticable. When the
foreign exchanges were favourable it was exceedingly
easy to manage the Bank of England, but, in his
opinion, when the exchanges were adverse, and discredit
prevailing, it was utterly impossible that the Act of 1844
could prove available for the purposes it was intended to
sere. told b 1 the promoters of that Bill that
the way to prevent an inconvenient demand for bank-
notes was to raise the rate of interest ; but the fact was
that the higher the rate of interest the greater was the
demand for bank-notes, because the greater the discredit
the more anxious were solvent commercial men to pro-
vide themselves with bank-notes to an extent exceeding
their actual wants. He had already alluded to the feel-
ing which existed abroad as to the state of English
credit, and as showing the opinion which prevailed in
tke United States as to the commercial and financial
position of England, he would read an extract from tke
New York Herald of the 10th of November. The
extract as read by the Hon. Gentleman, was to the
effect that the monetary crisis, and the frequent financial
.changes which had taken place in England, had greatly
diminished her commercial influence, whilst the influence
of the United States had been proportionably augmented.
The writer went on to describe England's difficulties
from the large amount of her national debt, the state of
Ireland, and so forth, whilst he depicted the glowing
prosperity of the United States, and the rapid advance
it was making as a manufacturing country. As showing
the state of public credit during the crisis, the Hon.
Gentleman referred to the reduction which took place in
the price of Consols, and the large discount which had
to be submitted to to secure the sale of Exchequer-bills.
Was it not essential, he asked, that measures should be
adopted to prevent a recurrence of so disastrous a state
of matters ? The Chancellor of the Exchequer had
called upon those Gentlemen who disapproved of the Act
of 1844 to tell him what they actually wanted, and not to
attempt to do indirectly what they hesitated to do by
direct means. For himself, ho did not say that he
wished to repeal the entire Bill. He was anxious, how-
ever, to see that part struck out which limited the issue
of the Bank to the extent which it did, and also the
limitation placed upon the issues of notes upon the se-
curity. There never was a greater mistake than this
latter limitation.—(Hear, hear.) Ile was positive that
great advantage would have arisen had the Bank been
allowed to issue notes upon the security of silver to the
full value of that silver. lie was anxious to maintain the
convertibility of the bank-note. He was opposed to all
doctrines about a domestic currency. In his opinion a
domestic currency meant nothing more nor less than a
depreciated currency.—(Hear, hear.) Were such a
policy adopted, England would soon be in the position
of Russia, where,there was a silver and a paper rouble.
In England we would have one banknote payable in a
fixed amount of gold, and another not© payable in
nothing at all. He would allow the Bank of England to
issue notes to the full value of silver, because silver was
the standard in Europe. When the exchanges were un-
favourable silver left the country, and when silver was
exhausted, gold followed, and, according to this view,
silver might be regarded as being available to the pay-
ment of gold. With regard to the country banks, he did
not think that all the threatening% of the Chancellor of
the Exchequer would prevent the evasion of the Act
which restricted the use of silver, should a deficiency in
the ordinary currency require it. Ile would not tres-
pass longer upon the attention of the House, but would
implore Hon. Members to adopt the motion of his R ig,ht
lion. Friend, and not allow the character and credit of
the commercial and easnulacturing interests of the
country to be sullied—interest: which he had n 1 ways
looked upon as essential to the prosperity and stability
of the country. —(liner, hear.)
Mr. W. BROWN, who was very indistincily heard,
having adverted to the causes of the late commercial diffi-
culties, observed that the Bill of 1844 was a dead letter
until the panic came, and then, so far from doing what
its promoters had promised—prevent fluctuation of
prices and secure confidence—it had aggravated the
evil. There had been greater oscillation in the price of
money under this Bill during the late crisis than in any
former period of financial difficulty during the last 25
years. In 1825 the rate of discount was--the lowest
the highest 41 ; end in 1832 the lowest was 24, the
highest 4 ; in 1837 the lowest was 3f, the highest 5i ;
in 1839 the lowest was 31, the highest 6i, being a diffe-
rence of 21- ; and in 1847 the lowest rate was 2i, and
the highest nominally was 6 ; but with commission it
was in fact from 15 to 20 per cent„ and even at that rate
in numerous instances solvent houses could not obtain
advances. The Bill had also occasioned hoarding. In
Liverpool alone he believed he could show that a
million and a half had been hoarded to meet con-
tingencies, and to enable merchants to meet their
engagements, and to take up such bills as might. come
back dishonoured, especially such as might be in the
hands of the Bank of England when the protesting of
any bill was attended with some discredit upon the h ausos
whose names it bore. He was an advocate for freedom
in banking, perfect security being taken for converti-
bility. The question was not now, however, whether
they were to maintain or abolish the monopoly of the
Bank of England; but be contended that they should
make it efficient for the public good. So far as the Act
of 1845 carried out the principle of convertibility em-
bodied in the Act of 1819, and required payments to '
be made in metallic currency, based on a fixed price for
gold, he concurred in it. He was aware that many
argued that as the national debt was contracted in a
paper currency it was unjust to require its repayment
in gold; but when the contracts for the loans were
entered into it was stipulated by Act of Parliament that
six months after the restoration of peace payments in
specie should be resumed; and had it been supposed
that payment would be made in a depreciated currency,
Government would never have obtained the loans on
the terms they did--perhaps not at all—and had that
been the case this country would now probably
be a French colony. He saw no great advan
tage that could result from a mixed standard of silver
and gold. Silver would always buy gold, and gold was
much the more easy and portable medium for commer-
cial transactions than silver. He thought there was
extreme danger in allowing the growing commerce of
this country to rest on an issue of 14,000,000!. based on
securities. He believed the Bank of England had done
what it could to preserve the public credit, and whileit
was necessary that a discretionary power should rest
somewhere, he did not think it could be in better hands
than that of the Bank. To show with what attention
the Bank of England was regarded, ho cited the case of
a merchant in America, who, on being remonstrated
with for ovortrading by his English correspondents, said
that he was governed in all his operations by the con-
duct of the Bank of England. Now, if the Bank was
thus regarded in foreign parts, it was most necessary
that the Government of this country should have the
power of putting it on the most stable foundation. But
ho know how uninteresting the subject was to the House
generally, and ho would only further.
lion.
express his reg
in
ret
he could not go with the Right Baronet
his measure. It would be desirable, he thought, not to
amend, but at once to repeal it.—(Hear, hear.)
Mr. HUDSON regretted that this subject had not
been brought forward at an earlier period. Nothing
was more calculated to disappoint the country than the
course pursued by the Government in referring this
important question to a Committee. They had been
asked if they were prepared to repeal the bill of 1819.
That, however, was nut the question at issue. They
were told by another speaker that railways caused the
distressed state of things. But the fact was, that the
railway calls in January, 1848, were larger than in
January, 1847, and yet money was now only at 3 per
cent. If railways, then, had anything to do with it,
why was not money as much in demand now as it was
last year ?—(Hear, hear.) They were told they were
consuming the capital of the country; but if they
looked at the coffers of the Bank of England now, they
found them full even to repletion. The truth was, the
importation of corn was entirely the cause of the crisis.
—(Hear, hear.) That importation had now ceased,
and, therefore, our stock of money remained undrained.
No doubt the country had been in a desperate state
last October. In Newcastle, for example, if some-
thing had not been done to prop up the kcal banks,
it would have been necessary to introduce mili-
tary into the town. What they had principally to coin-
plain of was, that solvency at that time was not pro-
tected. If the reason of their not affording such pro-
tection was the operation of this Act, then, he said,
repeal, it.—(Cheers.) Who defended the Bill ? What
commercial man in that House would get up and argue
in its favour ? Common consent condemned it. No
member of the Government said that it was necessary.
—Ulcer, hear.) He hoped when the Government next
wanted money, the Bank would only let them have so
much as they could afford in justice to other customers.
It was notorious that the Bank let the Chancellor ot the
Exchequer sweep away in one day a great part of their
reserve, which obliged them to limit the amount of their
discounts afterwards. This was a very blameable mea-
sure. I3ut he thought this was about the only act of the