The Sun.
London, England, 1856-12-01 00:00:00

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PRE RATE OF DISCOrtiVT.

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.The. Bank statement' of Friday hafraraa a'''bhsVia'w
to increase the impression as 44 that a retup.44.
rates of discount which prevailed beforftfflo
of November might have been adopted ;'P! •4 ig 41T1
day. The only arguments on the Oppoa.
have been that, although a great improvemen • (--•
resulted from the Australian arrivals and othe 'r- '4 "
cuniStances, it will be better to wait to ascertain its
permanence, that an impatience of high rates of
discountis a characteristic of all commercial and
•epeculative people which should be resisted, and
that, as the advance to 7 per cent. took place only
a little More than a fortnight back, de)ay would be
justifiable even, on. the simple ground ;of the desir-
ableness'of avoiding frequent alterations. The sole
considerations to guide the Bank, however, should
he the actual state of the supply and demand, and
the maintenance of a uniform mode of carrying into
operation any changes that may be deemed neces-
sary. Taking these test's the reasons kir a reduction
were complete. With regard to the' question of
supply and 'den] a/1 d it is kuowu that for several
days preceding the last Court the applications at
that Bank were comparatively unimportant, and
that if, instead of having u fixed rate, it had been
their custom, like other bankers, to atlant themselves
to the market from day to day lower terms would
have been adopted as a matter of course. It is true
this stale is not likely to last, but the main reason
simply consists in the fact that the recoil ue payments
froni now toJanuary will throw so much of the circu-
lation into the hands of the Bank that the supply
outside must, under any, ,circumstances be inade-
quate to the public wants, and the Bank can there-
fore , maintain any rate they please. This, however,
is far from being one of the contingencies content-
plated in making theM the depositories of the
public money, and it
.has consequently sometimes
been their practice, owards the termination of each
quarter specially to mitigate any existing pressure
by accepting lower terms for advances during those
periods. As respects the second point, the main-
tenance of a uniform mode of carrying into opera-
Lion any changes' that 'may be deemed necessary,
.their 'p sent course is: not in harmony with pre-
:lsimienta On the 22d of Maylast, when a reduction
to 6 per cent. was resolved upon, both the amount
of bullion and the reserve of notes were less than
on the present occasion, yet at that time speculation
on the Paris Bourse was rampant, a similar dispo-
sition prevailed on this side, the result of the
harvest was uncertain, the India and China drain,
instead of being partially satisfied, was just about
to assume its worst proportions, and the Austrian,
preparations to collect gold and silver for a resump-
tion of specie payments were in active progress.
If under such circumstances a decline to 6 per cent.
was resorted to without apprehension, it is difficult
to see why the public should be charged with an
impatience of restraint for desiring a similar step
now, after they have been subjected to a pressure
greater than any experienced since the crisis of 1847.
It is always unpleasant in financial matters to have
to remonstrate against what appears a poliCy of
caution, but the present question derives its im-
portance from the fact of there being room to ap-
prehend that the restriction which is approved for
its prudence may in reality prove a stimulus to
imprudence. Exactly in proportion to the pressure
put upon the community isathe subsequent rebouncl,
and if when there is reason to anticipate an ap-
proaching turn of the tide the rate of interest is kept
at such a point as to check or limit the usual orders
for foreign produce, and to cause money to be
drawn home from every available source, that turn
becomes sudden, instead of gradual, an inflation of
prices follows, and the orders which were kept back
when they would have been of a moderate descrip-
tion, are sent .out in reckless quantities. In the
height of such a renewal of ardour there would, of
course, be a universal admission on the part of the
speculators of the wisdom of the course by which
it bad been brought about, but those who wish to
see commerce pursue its legitimate channels and
our money market proof against the tactics of the
Credit Mobilier and their Russian friends will
watch its possibility with regret. No one can pre-
tend to say positively that the heaviest difficulties
of the late crisis have been surmounted, but there
is enough to warrant a strong impression that such
is the case, and provided we still kept our rate of
discount as high as the highest rate known any-
where on the Continent, there could be no danger
in giving the country the benefit of it. In case of
necessity the step could be at any time revoked.
The contrary argument, on the ground of the evil
of frequent changes, is unsound. The desirable
point is to keep the rate of discount as near its
average as possible, and if this could be better
effected by a change every week such changes
would be advantageous. No ordinary banker, if
left to his own course, would bind himself to spe-
cific rates beyond a day, and the contrary practice
of the Banlzhas long been considered objectionable.
Even as a matter of precedent, moreover, sudden
changes in times like these would be consistent. In
the railway crisis, after the rate was fixed at 7
per cent., it was reduced within ten days to 6 per
cent. Assuming there were any force in the
doctrine that a reduction once made could not be
rescinded at any moment without hesitation, there
would be no reason in the prevailing uncertainty
to complain of the policy now being pursued ;
but it is this very facility that seems to remitr it
unnecessary. At the same time, it is to be admit-
ted that the probable course of events during the
coming month is sufficiently obscure to allow of
many differences of opinion. The Bank Court be-
ing composed of merchants whose personal wishes
must be for, a moderate rate of interest, there can
at least be no question of the sincerity of their con-
victions in taking an opposite course. The sole de-
sire on each side is to discover in which direction
the prudent path lies, and those who contend that
a reduction to 6 or 61 per cent. should have been
made on Thursday last believe that course to be the •
one which is alone consistent with true caution.—
Times City Article.

THE COMMAND OF THE BRITISH FORCES IN

PERSIA.-OFFICIAL BLUNDERS.

We feel assured that the announcement that Sir James
Outrara I,asbeen
theappo Britishinte forcesdby the Indian
dndeiasnpaatuchthed t
authorities
the
saet
borne tocommand
Persian Gulf, will be received with unmixed satisfaction
from one end of India to the other. Sir James left
Southampton on the 20th inst., in improved health. It
is to be hoped that the outward voyage will administer -
further to his recovery, and that he will join the army
with sufficient bodily vigour to give full effect to the
suggestions of a mind always active and energetic, and
fertile of resource.
Our military readers will not require to be told that to
give effect to this appointment it was necessary to confer
on Major-General Outram the brevet rank of Lieut.-
General. The brevet has appeared in the Gazdte, brt we
observe that by a clerical error, which we have no doubt
will be speedily rectified, the brevet rank is confined to
the East Indies. Now, Persia is not geographically a
part of the East Indies, and it has been ruled that it is
not officially so. If, therefore, the present Horse Guards'
notification were to remain in force, Outram would be
liable to be superseded on the expedition touching Per-
sian ground ; or, practically (assuming the expedition to
have sailed before his arrival), would never be Competent
to take command of the force.
• Some regret has been expressed that Sir H. Rawlin-
son has not also been despatched to Persia, to conduct
the negotiations which are likely to arise out of this armed
demonstration ; and assuredly it is time that the anoma-
lous position which Mr. Murray occupies should now
altogether cease. But we are itot sure that Sir H. Raw-
linsou's extensive local knowledge and experience are
not as useful in this country as they would be on the
spot. For although the East India Company know
nothing about the war with Persia, beyond what they
learn from public newspapers, it may be fairly as-
sumed that her Majesty's Ministers, in whose bands is
the direction of the war, know wherethe
unlikelybestinformation
is still abundant
disentangling
to
find of
is to be found, and the best advice to be
be obtained.
A
as fatal as a blunder
blunder in Downing-street may
at Shiraz or Teheran. Moreover, there
time for Rawlinson's employment
complications with which wears n
our-
selves embarrassed at the end. o
tist, thoroughly acquainted
Persian Court, and capable of fathoming the depths of se
with the character of the
f the war. We shall as-
suredly then require the services of a first-rate diploma-
tist, the
their influence in Iran, we shall
seeking to strengthen
the ground that we have
Persian guile. With Russia, France, and America all
have enough to do to recover
, connection with this subject, that
it
We may mention, in
that Col. John Jacob, C.B ,
it is very generally rumoured that
S d be • =smiler in cm e, appointed
lost by years of mismanagement and neglect.
now acting as com
command of the force—an appointment regard.
difference of opinion can exist; but whe-
rank d position•
noeeference to the
„„ it a n be made, we are not yet able to declare.
effise:nVit, Elder, and Co.'s Overland Mail.
secondti nh ge
whe-
ther, wh etnhh nr

LEOPOLD REDPATH.—The interest which first excited
suspicion against Redpath is somewhat remarkable. Mr.
Denison, the chairman, was stanuing, outside the station
conversing with Lord Redpath approached and
lifted his hat to Mr. D., when Lord took him cor-
dially by the hand, and exclaimed, " Why, my dear fel-
low, how are you ?" After Redpath bad gone, Mr.
Denison asked his lordship what he knew of their clerk t
Why," responded the latter, "he is the jolliest fellow
in life—gives the tm,st sumptuous dinners and capital
bails that I know of:' That fatal and friendly recogni-
tion by.one so superior to him led to an investigation of
his accounts, and to his present lodgment in the House
of Detention.—Sunday paper.
With reference to the 6tatement made in the Court of
Bankruptcy on Thursday last, that the appeal from the
Vice-Chaucellor's.decisiun in the inatter of the Royal
statedtr or e e
British Bank would be withdrawn, in consequence of
arrangements then pending, with a view of affording
that the arrangements
con e a protectionppeal n 3 must proceed,
is now
templated having been found impracticable.