The Sun.
London, England, 1857-04-11 00:00:00

RISE IN TELE RATE OF DISCOUNT.

(From the Derbyshire Courier.)
The stock of bullion in the Bank, according to
the last published report shows a diminution of
334,7381., and is reduced to 9,987,5591. in both de-
partments. The reserve of notes is also low,
amounting to no more than 4,628,1201.
This return, which is up to the 28th March,
manifests much weakness as to the available means
for discount, and as no tendency towards an im-
provement is yet visible, the Bank could se tree ly
do otherwise than proceed to raise the rate of diem
count, as reel's Bill directs.

Accordingly notice was given last week that the
rate would be, raised from 6 per cent., at which it
had stood since 18th December, to 6i, and on
Monday further notice was given that the rate for
advances on stock would be 7 per cent. ; such ad-
vances being also limited to seven days. This
makes the forty-sixth changq in the rate of interest
since May, 1844.

The immediate cause of the necessity for these
stringent measures is the continued drain of silver
to the East, and the withdrawal of gold from the
Bank to purchase silver on. the continent for such
exportation.

The Simla, it appears, brought only about one-
fourth of the amount (340,0001.) which she was re-
ported to have brought ; and though the gold.
arrivals by , the Orwell and Derwent amount to
262,5881., and a further aggregate to the extent of
807,0001. of gold is shipped and on its way from
Australia, yet in the meanwhile the Bank judges it
necessary to adopt defensive measures against the
drain of its bullion.

The effect of this rise in the price of money is to
depress trade, check enterprise, and lower the
prices of all commodities. To this process the
people of England have submitted for nearly forty
years, and we see no reason why they should not
subunit to it forty years to come, unless they will
exercise their common sense, and endeavour, at
the eleventh hour, to understand the Currency
Question.

After this question had been long discussed, the
discoveries of gold in California and Australia in-
troduced a new element into the controversy. Half-
converts to the necessity of Currency Reform re-
lapsed into supineness and indifference in the per-
suasion that " the gold would put everything
right."
We expressed at the time a totally different opi-
nion ; being convinced that a system so radically
bad and erroneous as that established by Peel, and
made worse by Jones Loyd, would never "come
right," or be set right by even the most propitious
circumstances.

We are now receiving gold at the rate. of 12 mil-
lions a-year from Australia, and Peel's bills still
work mischief, and introduce the elements of un-
certainty, confusion, and ruin into all our com-
mercial transactions.

Let it be remembered that Peel's Bill established
free-trade in our coined money. You may now
melt down any amount of sovereigns to suit your
convenience. This is done weekly by jewellers to
a large extent. You may expect any amount of
gold or silver coin. This could not be done before
Peel's Bill.

But at the same time foreign nations can pur-
chase the bills of exchange of our merchants, and
obtain for them gold, not at its market price, but
at a fixed rate, at the Bank of England.
Peel's Bill, therefore, established free trade in
our coined money, and placed a restriction on the
trade in gold as a commodity.
Foreign nations hwe benefited in both ways by
this mistaken and one-sided legislation.
At this moment the coined silver of the conti-
nent is relatively worth more than the gold coin.
Four five-franc pieces are worth more than a
twenty-franc gold piece. There is a profit, there-
fore, on the exportation of silver to, the East as a
commodity. Our own silver coinage is not ex-
ported simply because there is less silver in our
half-crown than there is in three French francs ;
and 20 silver shillings are not in the bullion mar-
ket worth a full weight golden sovereign. But our
gold coinage, being more in proportion to its value
as a commodity, is withdrawn to supply the place
on the continent of the exported silver coinage,
and also to purchase silver for exportation.
As long as there remains an ounce of silver in
Europe which can be exported at a profit, wessee
no reason why this process of draining silver from
the continent and gold from England should not

- We have it in our power to remedy the evil at
once, by issuing 20 millions—(this we think would
be ample)—ot Exchequer notes of 1/. and upwards,
receivable for taxes ; and allowing gold to find its
market price in these notes.
The debt owing by Government to the Bank
might be at once paid off with such Exchequer
notes; the remaining amount of the Bank of Eng-
land authorised issue might be continued to that
establishment, and no interference exercised with'
respect to any other bank of issue whatever.

As sovereigns, it is to be hoped, would go out of
circulation, English banks should be allowed to
issue it. notes to supply the deficiency.
We do not like dirty country notes more than
other people. Let bankers, therefore, compound
for their issues, and never be allowed to re-issue a
note.