The Sun.
London, England, 1844-05-21 00:00:00

merchants for making their remittances to
India and China, and other places, which he
feared must he given up if they rigorously per-
sisted in confining their issues to gold, and gold
alone. lie would now proceed to other parts of
his explanation, which referred to joint-stock banks
and privite banks. He proposed that every bank
which had, on the 6th of May last, the privilege
of issuing notes should continue to exercise that privi-
lege as long as it thought proper. He proposed that
the stamp-office should make out immediately an esti-
mate of the amount which each bank of issue had issued
in the two years last preceding the 6th of May, and that
every banking establishment having this privilege should
continue in possession of it to a limited amount till Par-
liament should otherwise determine. He proposed, also,
that every bank should make a daily return to the
Government of the amount of its issues, from which
daily return the stamp-office should draw up a weekly
return, to be published in the Gazette, or some journal
which should ensure equal publicity. He proposed to
make a modification of his plan with respect to the
excess of the daily circulation of such banks. Thus,
instead of taking the circulation of each clay, he pro-
posed, to avoid penalties, to take the average of the
year. Thus, if a bank issued on one day 50/. more
than its maximum, and on another day 50/. less, that
bank should not be subjected to penalties. He proposed
that the stamp-office should also fix the day
in the following week on which it would be most con-
venient to publish the circulatioß of diateit.banks in the
week preceding. This wou*ktilti•cises be regulated
by the distance of each bank from the metropolis. There
had been some cases in which there had been a union of
banks. In these cases the returns would be made in
such a way as to cause the least inconvenience. He had
been asked what he intended to do with joint-stock
breech banks. He had been asked if joint-stock banks
!were to be allowed to add to the number of their branch
banks. His answer was that they might ; but that they
were not to increase the average maximnni of their issue
on that account. It was but just that there should be no
?hjection to this consolidation of the banks, and that the
!miles :should amount to the aggregate amount of both
thought
With regard to the number of branches, he
_hes, he
the law required amendment in this respect.—
(Hear' "eta) He thought it would be for the interest of
brea banks themselves that there should not be so many
prellseehes, because it was a source of great expense. At
on founrtltlrhe law required for the payment of duty only
.yment :fiches. He would not object to the estab-
-16111:nem
of new branches ; but he would require a
30/. on every new branch established.
thelle had been asked if he would permit the substitution of
p", on for the father, and allow him to take the father's
ace. Certainly he would. All he wished was that
the banks should give guarantees for the continuance of
!heir privileges, but should not attempt vexatious inter-
ference in private transactions.—(Hear, hear.) He had
been ttaked if he would interfere if there were five new
-Partners amongst six. It was like the old stocking that
Was darned, of which nothing of the old stocking re-
ruined. His answer was that he could not interfere
with the sale and transfer of banks. If he made a law on
the subject it would be evaded. He had been also asked
whether he would allow those bankers who now circu-
• lated Bank of England notes to substitute their own
Paper for the Bank of England paper, and take the
average of the two years. He did not propose to permit
any such arrangement. But then he proposed that the
Bank of England should grant those banks accommoda-
tion on the most favourable terms. The Bank of Eng-
land had transactions with those banks of a double cha-
racter. It permitted them, in some cases, to open
• a discount account at a rate of three per cent.
In other cases the banks have given one per
, cent: on the amount of bank notes in circulation.
r, The Bank proposed to put an end to the three per cent.
leel account, and to substitute the one one per cent. for the
ail, three per cent., and the Bank of England were quite
%tie, prepared to enter into engagements with the banks
„: issuing its paper for this purpose. He thought it right
to make this public declaration on this subject. He did
mot think there was any other point of importance which
- 'required explanation; and here he might terminate his
oServations, and permit the House to resume the dis-
cusskm, but that lie had been told his chain of argu-
, Merit on be former occasion was incomplete—that there
Was' no esecasary connexion between his premises,
which some reaul!v admitted, and his conclusion—
' .that he did not scsolf A necessity for interfering with
• the circulation of country banks and of joint-stock
I.,..banks, or of establishing a central bank of
""aue, and giving increased control to the Bank
'l4 England. He was not conscious that any link
in• the chain was wanting, because he had at-
: tempted to show'that competition among the issuers of
noted was a bad principle, that the same arguments did
-°‘ apply to that branch of commerce which applied to
bthers. He had shown that unlimited competition in the
isTrs,u,a of notes was had, from the example of America.
would let him go to the colonies he could bring
1lor• ward greater proof that the principle was a bad one;
and he would now try to bring it to their conviction,
•Ittv°ol the experience furnished both by England and
• al_.ea, that if they were wise they would take
IA---"aritY against unlimited competition in issue ;
HeY would increase the control of the superintending
,
• *-anks, and thus prevent those terrrible alternations and
riCissitudes in that medium which was to regulate the
title of every_thing, and from which they had so griev-
• .-"m!.3' suffered. Now, he would take the five great
rod. when this principle of convertibility had been in
SAogee •, and he would attempt to show that that
.linger h ad arisen from the unwillingness or incornpe-
eY of country.bankers—he excluded joint-stock banks
contract their issue. There were, in fact, live great
•E eriods--1825, 1832, 1835, 1836, and 1839. In Novem-
per 1823, the Bank was possessed of bullion to the amount
(it 13,760,0001. In November, P 325, it was reduced
3,012,000/. Now, it was quite clear that there
nett to have been a great reduction in the
Ii oun • ultion. e thought
, circ
wast entering into a useless conflict b p ersonsy
attempting to
• • •.. -7;tionstrate that ; but pamphlets, based on the oppo-,
to principle, were issued every day. There was one
,Published that very day—" A Metallic Currency a Bar-
,
' to the Progress of Civilisation, and the Primary
e of Restrictions en International Intercourse, with
'''"iggestions for placing the Currency of Britain on a
slew basis." That basis was a paper currency, which
said to be adequate to the growing demands of the
here was the old doctrine that the State might
!..estie whatever it pleased. But he assumed that the
•• t nsetjdrity of that House were in favour of one
~,'"otlard, and that standard a metallic one. If that
• Principle were right, there ought in 1825 to have been a
action :in the amount of circulation ; but, in-
' .:17:ad of dittifaishing, the notes of the country banks
increased from four millions to eight.
4211, the bullion in the Bank of England amounted to
in 1837 it had tlimintshed more than
-147Y.,000/. Did the circulation of the country banks
'Beta:me during the latter period ? No, it increased—in
la the circulation of the country banks was about
N°°°..'°°ol., in 1837 it had increased to 11,310,0001.
-el'etust, 1836 when the country was on the verge of
rtsLa in monetary affairs, the circulation of the coun.
404ta was more than 12,000,0001.—(Hear, hear.)
ofthe wanted to show was that during these periods.
:ae. great embarrassment, the country banks, so far from
4•l4lPathising in the embarrassment, were daily increas-.
etllBll6th of June
and thus aggravating the evil. On
June, 1838, the bullion in the Bank of Eng-
- 4,3 i" was 9,722,0001., in June, 1829, it was reduced to
whilst the circulation of the country ,banks
,1110,:att of decreasing had increased from 11,740,0001.
Oji e than 12,000,0004, when the Bank of England had
'l,OOO 000 L in its coffers. Making every allowance
4..,tuprovidence on the part of the Bank of England
did not wish for a moment to defend that bank
Raise it, was liable to the charge), it was quite clear
. Aft the country, banks were, even in times of monetary
• ehiettLlties regulated by prices, and that their increased
• • bent7ltion only added fuel to the fire.. The country
th "had no doubt rendered great serviue, but he asked
advocates to remember that when such disasters
4411tred 8•S must be now fresh in the mind of every"
thr.o4entthleinan who listened to him, and occurred too
ha
tuts e want of sympathy between the country
tleir VIA. the Bank of England, it must be
to -Plat caution was requisite, that they had
of , le -that
not against the use but the abuse
tNe kratry banks, and that legislation on
eces„ect, in some shape or other, was imperatively-
Motion-11'Y, in order to put a stop to improvident circu-
lal;.--7*( Rear, hear.) When he looked back to the his-
li.bin‘Private banks for the last thirty years, he was
844 -tPtised that it was reserved for the 20th of May,
Ke w' to take precautionary measures.—(Hear, hear.)
• af.prit'old reel to the House, from a return, the number
rely itatt: banks which had become bankrupt within a
t4Ptcie,of time. In 1840 there Were twenty-four bank-
, Late hinePrivate banks—twenty four bankruptcies of pri-
'11,18.42--;" ;r1 one year ! In 1841 there were twenty-six ;
II the vw'ire; and in 1843 eleven. And as an illustration
Plene---”ratem, he would inform them, that out of the
, ,teen
ovtittour banks, seventeen paid no dividends—seven.
*Ortat,„,„?f twenty-four banks paid no dividends ! What
clue4-ottY of individual suffering must have been pro-
tlist.tb:Y these failures.—(Hear, hear.) It was said
• 11!It whart°lile might have refused to take 'their notes,
hr eh° Ic .e
hadta the poor farmer or retail dealer to do ?
• he ?
This description of persons had
ouse , (Hear, hear.) It was impossible for the
tat-it "" 'et the occasion pass without giving some se-
. h,
LY against
es! oeee the recurrence of these evils. A return
made of the number of bankruptcies from the
7ould r Court from April, 1839 to 1844, and he
°Mee s ea" t° the House extracts from 'this return, in
th‘e° show the
e-ter-alteculat4t nature and cause of these bankruptcies.
instance, the cause of bankruptcy was
otintey t_ ton in Spanish bonds. A bank in a
Ping otryo, in which everything appeared to be
once well, and in which the utmost confi-
Litaged 7:13a most was at the same time
711,1da, and
when
hazardous speculation in Spanish
is`caula „tl„7'co the sudden crash came upon the bank
Ali icy viix,Y_ no dividend. In the second instance the
wTaisleariipirit-mercliant, and the cause of his bank-
third ease
tto dividen. .eged to have been paying his father's
the was no dividend in this case either. In
Irtavtiti bad speculations too, and there was
°ecasioned b
.the fourth instance the bankruptcy was
"atakropts loan on railway speculation These
were supplied the of exchange—they
e—they
14,• ot trading in c ehdieyulnwere converting credit
:2
_,aepuital—mt
bony' the fifth case the bankrupt 111 the entering into
21;ras:, and overdrawn his private ruepatt raadi 1
swuacy.
.ed to considerable pr P
sorbin. notes to the amoisunpt he had mortgaged his
riovfatel47ooocoutn,ts, issued pro-
ruttheprofit of the bank, felled,
after ab-
bei the whole
..e able to
the bank any return to his creditors. In the
some without
retrime bankruen insolvent for many years $
-urabl3', had be
and 66,t,t001ny
although apparently going on &-
having lost large sums in sugar
at length
a commercial house in Was-
Lae onei the seventh case the bank was conducted by
100 e and th
IA/U4 nePhew, and the nephew dissipated--
1148 the uncle died, 'varying a large fo

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