The Liverpool Standard and General Commercial Advertiser.
Liverpool, Merseyside, England, 1840-08-11 00:00:00

TATTERSALL'S, THURSDAY

-The room was but indifferently attended, several sub-
scribers having left for Brighton Races. A few of the un-
settled Goodwood accounts were adjusted, but many were
still open, and business in other respects was too flat to re-
quire any introductory observations.

THE ST. LEGER.
7 to 2 against Lord Westminster's Launcelot
Bto 1 „ Lord G. Bentinck's Crucifix.
10 to 1 „ Gen. Yates's Gibraltar.—t

14 to 1 „ Lord Westminster's Maroon.—t twice
1000 to 30 „ Duke of Cleveland's Tlieon.—t
2000 to 20 „ Mr. Clarke's Alonzo.—t
500 to 400 on the field against Scott's and Dawson's lots
(t); 200 even between Dawson's and Scott's lots (t).

BANKING

TO THE EDITOR OF THE ATLAS

Edinburgh. 27th July, 1840

SIR,—I have lately suggested a scheme for the 'regulation
of Joint-Stock Banks ; and I have done.so after much con-
sideration, and, I must add, a perfect knowledge of the sub-
ject. As you designate yourself " The Banking and Mone-
tary Atlas !" I thought you were, of all others, likely to
favour a plan of which the first object is stability ; and I have
accordingly sent you copies of the papers in which my obser-
vations appeared, regularly as they were published. And
how have you received this ? Not by giVing my plan, as was
your duty as an impartial journalist ;—not even by honestly,
though covertly, combating any thing objectionable in it;
but by attaching my words to schemes which I utterly repu-
diate and detest, and seeming to conquer what you never
venture to bring in sight.
For example, I strenuously argue against a SOLI BANK OF
ISSUE, and I have given reasons which ought to be conclu-
sive. lat the same time contend, as I seven years ago pub-
licly contended, for NUMEROUS AND INDEPENDENT BANKS
OF ISSUE. But I insist, first, that the issues of these banks

shall be limited to a fair proportion of the circulation con-
sidered necessary for the purposes of the country; and, next,
that this amount, whatever it may be decided it ought to be,
shall be guaranteed, by the deposit, of security in the public
funds, to the extent of one-half the issues proposed to be
made ; this, security to be intangible by the banks, while
currency continues to be issued upon the faith of it ; and
upon their ceasing to issue, to be re-delivered, one hundred
pounds of security for every two hundred pounds of notes
retired (that being their original ratio), until the whole shall
be retired.

For these, and for all the other regulations I have pro-
posed (and they are just SEVEN), I have given reasons which
show them to be as just as they are necessary ; and I have in
all events spoken so clearly, that it is impossible for any one
not to understand and judge what I have said. You evi-
dently object both to the proposal to limit the issues, and to
secure them. Ido not say you do this in " ignorance," or
froin a desire to he " mischievous,"—though it •will speedily
be seen I might be justified. There is another alternative;
but I shall not mention even that ;—I shall merely show
what you have done.

In Your paper of 25th instant, you speak as follows :
" There are men calling themselves practical, who are so
wholly and vehemently opposed to the principle of numerous
banks of issue, as to question almost the solidity of any bank
issuing notes of its own, except the Bank of England ; which,
because the greater part of its capital is in the hands of go-
vernment, is supposed thereby to hold out an undoubted
guarantee for the stability of its issues." Now, lam not
opposed to the principle of numerous banks ; on the con-
trary, I expressly contend for it upon every ground; but I
do contend that these issues should be limited, and guaran-
teed as those of the Bank. of England are guaranteed. Yet
you evidently refer to me in this and throughout your argu-
ment ; for you immediately after quote my words, and refer
to my illustrations, and no other. " Such men (you con-
tinue) will inquire with amazing profundity, " if the circula-
tion of banks is not limited, how can it be regulated in amount,
or rendered safe by guarantee ?" These are my words ' • "and
going on to ask, What security can the public have, that the
most stately and apparently prosperous banks, are not things
of straw ?' (which are also my words) " will sagely endea-
vour" (you go on to say)' "to answer their own ignorant
interrogatories, and corroborate their mischievous insinua-
tions, by allusions to the Agricultural and Commercial Bank
of Ireland, the Northern and Central Bank of England, and
the Commercial Bank of England :"—the three establish-
ments to which I have alluded, though I might have alluded
to many more. " There is no reassiing (you say) with such
persons upon particular facts : their views are so distorted
that the labour would be profitless ;"—an assumption ut-
terly unfounded in my case, but very likely to be applicable
to those who, having a particular interest in view, must do
their little possible to carry that, regardless in the mean time
of any thing else.
" But in reference to. the first question" (you continue),
" it may may be answered, that the circulation of all banks
is limited,—except that of the Bank of England." How?
" By the very principle WE wish to see introduced in London
—competition." Now, this is any thing but an efficient mode
of limiting, as we see in America ; where, as I have men-
tioned, the circulation of banks is more depreciated than the
assignats of the most profligate governments. It is a princi-
ple, I add, that never acts till the mischief has been done in
times of prosperity; and in times that are in the slightest
degree otherwise, is always acting the inverse way, viz. in
destroying, by absurd caution, those whom it has brought
into peril by equally absurd confidence.
" Were there numerous joint-stock banks of issue (you
persist), the circulation of the Bank of England would be,
very effectually and usefully limited." Doubtless; and who
would limit the issues of the substitutes ? BOTH must be
limited, if the circulation is, in times of prosperity, to be
kept of a rational amount ; and neither should be limited in
times that are otherwise, by panics on the part of the public,
or paralysis, from the apprehension of such, on the part of
the banks. • The circulation of banks should be, at all times,
limited to what may be deemed a fair amount ; and, within
that limit, there should be perfect freedom on the part of the
banks, and perfect fearlessness on the part of the public. I
have endeavoured to provide for both these. I add, that
without them we can never have a circulation approaching to
soundness, but a substance which every adventurer may de-
preciate at pleasure, and of which neither the amount nor
the valu can be even guessed at.

" With respect to i=lle;ecoiiri question" (you continue),
" it is answered generally, that the public have all the secu-
rity for the issues of joint-stock banks which it is necessary
for them to have;—and this has been so often explained in
these columns, that it would be a waste of time to recapi-
tulate it." Now, I would briefly say, in answer to this, that
at this moment the public has not an atom of security for
the transactions of any joint-stock bank, or any other bank
in England, beyond that afforded by the prudence and honour
of directors. The apparent capital may be of millions, with
one pound per share paid up ; half of that again drawn out
by the parties per contract ! and bills to any amount, and of
no value whatever, discounted on the faith of the balance ;
and neither ability nor inclination in any quarter to make
good any ultimate loss !—Banks are shown to hive existed
upon this principle, and to have been thus conducted ; and
give them full swing, and they will never he upon any other
principle. Why should they ? " The failures of one or two
institutions from mismanagement, do not" (you say) " furnish
any argument against joint-stock banking.''—And I answer,
Certainly not against joint-stock banking, properly founded
and conducted ; but the failure of even one bank, from mis-
management, or the possible failure of any bank, sufficiently
justifies the public in insisting for guarantees against it.
Why, in a matter of such public interest, and that, in its
operation, must affect indirectly the fortunes of every one,
whether they will or not, and may directly affect the fortunes
of many, why proceed in it as if it were a mere private mat-
ter, and respecting which every one might judge for himself?
The idea is utterly indefensible.

" With regard-to the danger apprehended from unlimited
issues, or issues without security given to the government, it
is a very well-known fact, that the public have never lost one
farthing by the. suspension of any Joint-Stock Bank. The
public creditor has always been paid in full." I shall not
dispute this as to England because I do not know whether
it is the fact or not ; but I know it has happened otherwise
in Scotland, and that more than once, and also very recently.
That ultimate payment might be rendered nearly certain,
I admit ; and no plan, I think, seems more likely to effect
this, than the plan 1 propose. But, at present, there is no-
thing approaching such a guarantee.
But, supposing ultimate payment assured, is the interim
confusion that always follows from the suspension of a bank,
nothing? How many may be ruined by the temporary dis-
order? or compelled to part with property at the greatest
loss to avert it? And how often is ultimate payment to the
public, effected by the ruin of many families of the partners
of banks,—by those having means being compelled to pay
for those who had none ? Even in Scotland, shares in banks
that were never worth more than £lOO, have caused a loss
to the holders of three thousand pounds I This I state from
perfect knowledge—a thing of which you seem perfetly inno-
cent. And this loss to respectable partners of such esta-
blishments, or liability to the innocent families of partners,
coupled with the confusion that inevitably follows to the
public from the suspension of banks, whether there is nominal
ultimate loss or not,—these alone would be sufficient to ren-
der the guarantee I have proposed seem necessary. But
when we add the certainty of loss that awaits the public,
from the present imperfect system, if introduced into a great,
and busy, and unsuspeeting community, aguarantee of issues
becomes unavoidable.

And as to.a limit, it must be found if there is a guarantee;
for the one is impossible without the other ; and there should
be a limit whether there is a guarantee or not ; unless, instead
of occasional depressions in the value of money, it should be
rendered at last of no value—till brought back, as by Sir
Robert Peel's bill, by a violent reaction ; to the ruin of all
holding property, and the enrichment of the casual holders
of this depreciated money.
In taking up this question, as in taking up every public
question, I have thought of only one thing—the interest of
the public. I have spoken as openly and explicitly as I could,
and I have given my name ; and, consequently, I expected
to find the press of England, boasting as it does (and perhaps
justly) its pre-eminence and perfect liberty, take up this very
vital question upon its merits only, and disregarding any
petty interest, or even any private interest, however impor-
tant. The result is yet to be seen. In the meantime, you
have treated the matter in any thing but a fair manner. You
have tried to dispatch me (as your countryman makes Mac-
beth do the grooms) in the closet, lest I might have " an-
gered" you by making fight on the stage. But I shall get
out. In the meantime, and till you have changed your prin-
dAetelmasa;bulebtgraAtitielars7_hoerSatirlaywo-tßhaenrksoArttlaosf,
ciples as to banking, do not call yourself " The Monetary
The
but I r re
not-
the monetary one. Yours faithfully,
D. BAIN.

LAID OFF COACHMEN ANDgua r GUARDS.—What will be-
mandysof coaches, who, by the
be-
come of all the drivers and
question : very,
amesan.eyli)f the individuals
employments ; wahilbeyfr, if any
tchoamniitiog
ainnswopeerrtahtiiosnquo linesw of railroad, will be
thrown out of employment? It is,
yoorkeauspoonn.
confess, easier to ask
hacvoenTen-
v alludedions duties
uttoi
easrefor unfitted
taking bnye
ir 'their
their pre-
of them;.it is to be feared, are in circumstances t
their change in life with indifference. It is not vner,
able to expect railroad companies to make any
sation" to the persons whose " vested interests"
placed by steam influence in " Schedule A," nor are theireen
old employers, the coach proprietors, much more likely to
allow their old servants " retiring pensions"--.--it may be
hoped, therefore, that parties to whom they may apply for
situations, or individuals having the means of otherwise
helping the " old stagers" at command, will take this friendly
hint in behalf of a class of men, almost as little used to the
ground as sailors themselves, and who appear likely enough
to become ere long extinct as to those striking peculiarities
which have so long distinguished the old English coachman
and guard.