The Sun.
London, England, 1860-04-17 00:00:00

TO THE EDITOR OF THE SUN.

Sit,—ln the correspondence between these right hon.
gentlemen on the Indian currency scheme proposed by Mr.
Wilson, we find the advocate and the opponent of the act of
1844 fairly at issue on the principle of a sound system of
currency—Sir Charles Wood contending for the applicatiGn
of the principles of restriction imposed OR paper money by
the act of 1844, and Mr. Wilson throwing them overboard.
Which of them is in the right, and which will have to
give way to the other, are questions of great interest to the
public, who, as a jury, will have to try and decide them.
Mr. Wilson, in paragraph 13 of his minute, says :
"By maintaining at all times a fixed proportion of silver
to the amount of notes in circulation, and convertible pub-
lic securities for the remainder, not only is the immediate
convertibility of any probable portion of notes likely to be
presented, provided for, and the ultimate payment of the
whole specially secured, but a natural and self-acting limit is
placed upon the amount of the circulation—a limit which
would expand and contract, according to the wants of the
community, in the same manner, and to the same extent, as
a purely silver currency would do."
Sir C. Wood in his rejoinder denies that the immediate
convertibility of notes into bullion will ensure a natural and
self-acting limit ; he says— _ .

•
Par. 13. " The sound principle for regulating the issue
of paper circulation is that which was enforced on the Bank
of England by the Act of 1844, i.e., that the amount of notes
issued on Government Securities should be maintained at
a fixed sum, within the limit of the smallest amount which
experience has proved to be necessary for the monetary
transactions of the country ; and that any further amount
of notes should be issued on coin or bullion, and should vary
with the amount of the reserve of specie in the Bank, ac-
cording to the wants and demands of the public."
Tf this principle be sound, then are the principles of Free
Trade unsound, and should be suppressed by restriction on
all other trades as well as on that of money.

This sound principle ensures a constantly diminishing
quantity of currency for the wants of an ever increasing
commerce, inasmuch as the quantity of notes issued by the
Bank of England against securities is a fixed quantity,
and cannot be increased, and those issued by country
banks are subject to diminution in quantity, for when their
issue ceases from any cause whatever the vacuum can only
be filled up to the extent of two-thirds of the amount by
the Bank of England. Thus, were the present aggregate
amount of about £17,000,000 to be in the course of time with-
drawn, only about £11,000,0)0 could be issued by the Bank
of England as substitutes. This vaunted principle, there-
fore, makes the unlimitable increase of our commerce de-
pendent on the accidental and fluctuating amount of gold
for the supply of the medium of exchange for carrying it
on, it seeks to regulate the quantity of money, not " ac-
cording to the wants and demands of the public," but ac-
cording to the ebb and flow of gold in the coffers of the
Bank. Hence naturally the monetary panics of 1847,
1857, and 1859, and the constant apprehension of their re-
currence.
On Mr. Wilson's plan any person taking silver bullion
to the Bank can obtain Government notes in exchange, or,
taking notes, can have bullion in exchange ; but power is
given to the commissioners to sell and invest two-thirds of
the amount of the bullion in Government Securities, so that
the only limit to the issue of notes is the maintaining the
proportion of one-third of bullion to the whole issue.
This plan takes care of the quality of the currency, but
leaves the quantity to take care of itself; it sanctions free
trade in a sound currency—a principle for which we have
long contended.
Is not the time arrived for acting upon the same principle
here, by establishing a national bank of issue, where all
can have as many national notes, payable in gold on de-
mand, as they may want, on depositing one-third of the
amount in gold and two-thirds in Government securities ,
and which notes, when no longer wanted, could be returned
and the deposit recovered ?
Should not an end be put to the squabbling between the
great money dealers, the discount houses, and the Bank of
England (a dispute highly prejudicial to the commercial
community, from the artificial absorption of money which
it creates), by allowing the public, whose agents they are,
to have an unrestricted and natural supply of a perfectly
convertible medium of exchange ? The mischief is owing
not so much to the directors of the Bank of England as to
the restrictive clauses of the Act of 1844, by which they
are fettered. _ _ .

Is it consistent for this country, the commercial mistress
of the world, to sanction opposite principles of currency at
home and in her dependencies—to permit free trade in a
sound currency in India, and to impose restrictions in the
currency in Great B:itain and Ireland ?
I am, Sir, your obedient servant.
HALTER STAN SFELD,
The Grange, Burley, S. Otley, April 14.

piE INCOME TAX.

TO THE EDITOR OF THE SUN.

SIR,—On the 10th October last the agents for the Tur-
kish loan deducted from the interest, due that day on the
bonds, income tax at the rate of thirteenpence in the pound,
and it was naturally inferred that the deduction for the
half•year falling due yesterday would be at the rate of five-
pence, thus making the tax ninepence for the year. In-
stead of which the agents deduct on this second half-year
te;rpence in the pound, in obadience, we are told, to orders
from Somerset-house, while the deduction from other sneu•
rities, of which the interest,fell duo on the sth instant, is
only at the rate of fivepence. Is this just? I doubt if it is
legal. But I have no doubt that it furnishes a strong
argument for the evasion of payment in those cases which
the fiscal power cannot reach except through the conscience
of A TAX PAYER.
April 11.

The Right Hon. the Chancellor of the Exche-
quer, on his taking office, vacated his house in Carlton-
gardens, to occupy the official residence in Downing-street.
Our brilliant Finance -Minister is now, without going out
of °Moe, about to return with his family to his own private
house. Of course, this proceeding has given rise to all sorts
of conjectures. They have,thowever, no other foundation
than the fancy of those who indulge in them—the truth
being, that Mr.'and Mrs. Gladstone have this year a
daughter to introduce to the beau monde, and that a series
of brilliant parties in the paternal mansion will usher Miss
Agnes Gladstone into the gay world of London, her pre-
sentation to the Queen having taken place at the last Draw-
ing-room. The term for which Earl de Grey had taken.
Mr. Gladstone's house having expired, the right hon. gen-
tleman took the opportunity of resuming possession.--Court
Tounia4