Star.
London, England, 1826-02-11 00:00:00

Feted, a relnetance to give up a rate of anneal rroP-.,
wliich, during the war, had afforded these dividends,
had however influenced their conduct during peace, it
could not be denied that there was some degree of blame.'
Tic Innen possession of this large amount of specie,
ca, no cam rensation for the advantages they had before
possessed. They did increase the issues of the Bank,
anJ although there is no immediate connection between
an increase of Bank of England paper and of
country back paper, yet the one naturally follows
the oaer. An immense increase of the whole cur-
rency to. k pla.-e. A great abiindance of money
aas the consequence. Nobody knew what to do
with it. The anxiety to secure some sort of
i:lterest tempted Bankers to lend money upon most-
pa,4e, and otherwise to put it out of their immediate
teach. The Bank of England was soon admonished;
as soon as it found the demand for gold increase, the
loose arm with which it had been riding-was suddenly
ericed up. The precautions they adopted quickly
i•lrectel the Bankers in London. These,, in their turn,
%ere compelled to contract their usual accommodat:on
:o the Country Bankers, and from the Country Bankers
tile prepure was diffused throughout the country. In
such a state of things some of the weakest houses fell
to tbe_glound, concealed insolvency now becomes ap•
parent, failures become frequent, and panic succeeds,
runs take place upon-Banks so generally that no prudent
Banker -feels easy without Bank of England notes, or
cash, actually' before him to the full arnou'.t of what he
owes. All the complicated machines yof credit in this
country is at once •destroyed—no man can trust his
neighhour—every man stands upol his own resources.
Tie Juin extends to the most opulent and respectable,
tn~n. lie had known an instance of a man hunoutablrand
fairly worth 200,0001. being compelled to apply for relief.
11,:agreed in the propriety of eventually and perma-
wqliy calling in the small notes, but doubted exceed
1.:,!!y the wisdom of taking any measures at present
vards that object. He lamented th the Govern-
:l eitt had not withstood the importunity of the Country
13 .nkei s, when they urged the continuance of this paper;
but fie dal not like the triumph of general principles to
b- sought at this moment. No man would discuss
abso Act questions when his, house was on fire. He must
again repeat, that he thought the revenues of the Bank
of England too much choked up by its connection with
Government. There had been already advanced eight
millions on account of the dead weight; and if the bar-
pin was completed, the Bank would be in advance
nirteen millions on this separate account. Owing tothe
.genious contrivance s of Lord Bexley, when Chancellor
if the Exchequer, the Bank bad been saddled with pay-
kg on account of Government the deficiencies on the in-
Iciest of the debt, amounting to seven millionssterling.
['rite caLweeatos of the Eacnonttsa : Those deficiencies do not
exceed Ave millions and a half.)
Mr. BA RING said, he was unwilling to over-
state the question, and what had been admitted by the.
Hight Hon. Gentleman was Sufficient for his argument.
These 5,500,0001. however, which the Bank advanced
f r Government, although they might be repaid as
quickly as pos,ible, still tended to embarrass them.
The great object of banking was, not to have funds
tucked up, but to have them always disposable. The
whole extent then of the Bank's engagements was
Exchequer bills £7,000,000
Deficiencies ou dividends • . 5,000,000'
Dead *eight . 8,000,000
_ _ .

And to pay off the dissentient holders of
4 per cents. about . •

'2,000,000

Total . . Je4e,soo,ooo
which was entirely shut up by Government from the
controul of the B In addition to this, there were
1,500,0001. invested in mortgages, which was in
'twit a most improper and imprudent step, wholly in-
eefensible upon principle. The amount, was not in
i'self any great aggravation of the difficulties of the
I': ink; but when it came to be added to the other disburse-
ments, it made up the enormous sum of 24,000,0001
of unconvertible capital belonging to the Bank...-.
Bow, then, was it to be expected that a Bank should be
in that state in which a Bank ought always to be, namely,
ready to take up its engagements, and exercise a pow-
erful infilence on the state of public credit in cases of
emetgency, such as they had recently witnessed? Had
(X ivernmeet been embarrassed at all in its operations,
instead of its being a period of profound peace, and
Souks at 95 per cent. steadily, there might have been
some excuse lor such an attempt to ease themselves at
the expense of the Bank. But as it was, nothing could
be mote clumsy than their mismanagement. All this
while it should also be remembered, that the Bank was
no capitalist. In the year 1783, when this country was
experiencing the greatest difficulties from ,the come-
ciences of the American war, the Bank of England was
s far exhausted that it had not actually half a million
sterling in its possession,and was all but bankrupt. Again,
during the French revolutionary war, the Bank was, in
1797, obliged to suspend its pay ments,the coup de grace
having been given to its solvency by the Austrian Loan.
Tile Rank, then, being itself possessed of no permanent
capital, how was it possible that being choked up by
Lie wants of Government to the amount of '24 millions,
it should be. at ease, or have. elbow-room for its own
commercial operations? He WAS far from thinking
that our embarrassment was anything but temporary;
yet he considere f the Bank as it were, the heart of the
circul4tion of the country ; and if any check was expe-
rienced there, it was sure to extend to all the Country
Eattks. If, added to All tltis,..a frenzy of speculation,
such as that which they had witnessed, should, like the
wind, wh ch comes one knows not whence, break in
upon the resources of credit, and overwhelm reason and
pi udelice, it w 4, not wonderful such results should have
t then place as we at this day witnessed. The. Ministers
seem to have forpt that it was their duty in peace to
ICeetio their money up, as his Majesty's ships were all
re sdy for a start, lest an alteration in affairs, however
ifloinising they now appeared, should render a war
cessAry, or n large sudden expenditure expedient. But
ete,whilst they hod been choking up the Bank with the
olustquences of foolish philosophical conceits, they had
tinbartassed both it and the country, and were in such
.tote for want of means that they were unable to
'quip a fleet of ships of war, or even to make the'
least defliOthtrati;:ll of hostilities, should there be even
real ground of provocation or offence. The power of
a Government like England consisted in its fret:my,'
we had long since discovered to be far beyond
erlitrry strength by the unerring test of experience.
Taus in the leg great contest all our successes were
"log to our money, and though we never had more
tl"u between ion) and fifty thousand British soldiers
the field, set they were sufficient, under that dis-
Itriginsfied 13.ixish leader first in the annals of fame, to
r"oe the elme,u4 means of wresting other nati
, " the grasp 14 the powerful usurper of the
atilwue of !''ranee:. Ting reel scnwcr of our great-

ness had been overlooked, and everything had
been sacrificed to foo:ish financial kitties. The
;liberality of its issues on the part • of the- Bank,
'would have, perhaps, effected mach, and relieved pub-
lic credit, if the Ministers had not fettered the Bank as
to its operation on trade and commerce. This was the
more likely, because that thrie.fourths of the panic was
created out of the other fourth, for which there was
some foundation. It was just the same as in an alarm
of fire at a Theatre, where the great-danger arose from
people treading each other to death in their anxiety to
escape from that which was often only fancied danger
He shnold next suggest to- the Batik the propriety of
not looking to such very great profits on their busi-
Imes. It would be wise if they would rest settled
With realising a profit of six instead of eight per cent.
As, to the popular projects for reeving the pressure
now experienced and preventing its recurrence, the first
was one for the erection of a second National Bank;
this he confessed he thought a hazardous expedient,
indeed he would not disguise his opinion that it would
rather tend to increase the confusion, if a great banking
est iblishment in the West were found contending with
the present in the East. The Right Hon. Gentleman
this evening had said that the Bank, forsooth, had con-
sented to relinquish that part of its privileges, which
secured to themselves alone the privilege of being
baited in a banking firm consisting of more than six
persons. Now it appeared that out of 800 banks there
tome not more than 26 which availed themselves of the
privilege of having six partners in the firm. It was not,
therefore, very likely that if the Legislature opened the
field of speculation in this way, and permitted an enlarged
number of proprietors in banks, the number of partners
would be found to exceed that now flied by law : since
Into very few instances even six private Gentlemen would
be found to trust each other reciprocally. Indeed, if
any Cmintry Gentlemen should be tempted to commit
their property to the issue of these speculations on an
enlarged scale as bankers, they would be guilty of an
egregious folly. It would have a very different effect,
he believed; if the Right Honourable Gentleman would
retort mend to Parliament the passing of an Act for
sanctioning Banks, in which the partners should only
be liable to the amount of the sum for which they origi-
nally had consented to become liable. He believed
this would prove a public benefit, by inducing a number
of respectable men of undoubted 'property to embark
in banking on this prudent, and, as he considered it,
solid principle of a JointStockCompany for this purpose.
If such a proposition were acted on, he should propose
that a public record should be kept of all such banking
companies, their partners, capital, and separate liabi-
lities ; that these books should be open to inspection
yearly, and that if it appeared any one had drawn out
his capital, or incurred debt, he should be compellable
to withdraw. These was another improvement to which
he should have to apologize, in the first instance,, for
drawing their attention somewhat in detail. He meant
the que.tion of the standard of value. And first he
should propose that payment, in silver as well as gold,
should be a legal tender. The value of any fixed
standard must, in a great degree, if not altogether,
consist in its invariability, and this he thoughtwoyld be
best attained if the standard were to be fixed by re-
ference to the values of both gold and silver, as such a
standard of values would be less variable. Silver is to
be bad at all times with greater facility than gold.—
The exigencies of commerce and foreign remittances
made it often necessary to send' abroad Specie; that
'could be done without difficulty in silver, but
'where gold was to be bought first, as was often
the case, with that silver, all the evils of an uncer-
tain standard were experienced. If the Bank, then, were.
at liberty to use both as a legal tender, its transactions
would be conducted with greater ease and with reater
public accommodation, because it would at all times
lay its hands at will on the silver, which would fix the
standard of values with much mere certainty; besides,
.if the silver were equally available we might double or
treble the amount often required in specie. Gold too-
being, after all, but a mere merchandiseable commodity,
It was open to the operations and competition of trade,
and the Baek of England might feel itself thwarted and
opposed in collecting together a sum in gold sufficient
for its purposes ; and he was fully convinced that it
was perfectly possible for certain houses in business,
with comparatively inconsiderable means, to prevent
a single ounce of gold getting into the hands of the
Bank, however anxious it might be to obtain it.—
In the case of the American war alluded to, the war
was obliged to be terminated with nioitification, for'
want of gold; and in the French war the Bank of Eng-
land stopped payment, though the war went on because
the French would not hearken or consent to peace. In,
this country we took a metallic standard which no
other country took: in France, where gold and silver
lived togeth r in perfect harmony, there was not more
than ten centimes difference between them, while he
was in France. It had now got up, however, to one
and a half, or two per cent. on account of the large
drafts drawn on them by the Bank of England, under
the present demand. Such was the effect of their fine
philosophical standard, to the beauty arid consistency
of which they sacrificed so'mech. If he were to sug-
gest a plan, it would be, to leave the small silver, the
half crowns, shillings, and sixpences, as they were, but
to call in the crown pieces, make them a quarter of a
pound, and constitute them a legal tender at that rate.
It might be said, that with ten sixpences of the common colts,
they could then buy twelve of the standard ; but they cupid do
the same thing now. Perhaps it might be objected, that the crown/
would be too cumbrous to answer the convenience of trade; bet
such an objection could not be admitted to have muck forte, when
at any time they could, for two shillings, get a hundred pounds
in gold, in exchange, fur the silver. Experience had fully proved
that gold went out of the country much quicker their sliver. We
had made a beautiful new gold coin, the very perfection of which
had a tendency to aLgravate that disadvantage, especially since the
repeal of the law which prevented the exportation of cobs. to the
old times the coin used logo out of the country when the exchange
was against us, but now it went out when the exchange was not
against us. In old timers, the exchange breker had a risk to ran
when the law was hi arms against him, and though, in times of
difficulty, they would rather take on coin than paper, berating
there was less risk, yet 'persons of large capital being.geoeridly
unwilling to offend apron the law, all traffic of this nature was
necessarily confined to small dealers, against whom the Bank could
more easily protect itself. There was no reason, that he could
see, why we should be more nice tiro the rest of the World in
this respect, who were satisfied with the mixed seamiest', and found
their advantage in adopting it. With respect to the supposed is-
sues of the Country Banks, the Right Honourable Gentleman had
estimated tin amount of the notes supposed to hi in circulation at
eight million,* few nights ago; sins then he had reduced hie calculi
titan to six asiihens, and on this night he had sunk is se low as fem.
But, however the fact might be, the Hume would de Ina to re-
collect that though a few million might have a Laza aoead in gais
wealthy niettopolik tb4ty might be everything ip the cv41.1111
Banks. It might be said that a great deal had been already dope,
that much of this paper was already withdrawn horn ;initiation;
but if Government, with a view to contract the Imre" stillbirth/se,
was to apply the screw, the,effect of 'arch a sudden menete
probably be to aggravate the present distress. The lag
' Gentleman had given them no opportunity at seeing teisedy
what licsvn about, for chr. Resolution be but retool was .S ply