The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1844-06-09
THE NEW SYSTEM OF CURRENCY
PROPOSED BY
SIR BERT PEEL
IN THE
British House of Commons.
MAY q, IS44.


fContinued1
Sir, assure you and the house that ! will pro-
pose no practical system for It's adoption on tins oc-
casion which is not conformable 10 the principles
| which have laid down, aud which shall not have
for s object 10 carry those principles fcheers)
| know, sir, full well, when touching subjects o.
| such dellcacy, when there is so much danger OF
creating alarm panic, the advantage, indeed the
necessity of doing little of injury as possible TO
interests that are concerned, by the advocacy, or
the mode OF advocacy, OF principles however
sound in themselves. Admitting, then, the sound
OF those principles, the question appears TO
| to be IN what mode shall we, conformably with
those principles, provide for the maintenance OF The
! banking system OF the country, taking care that
during the interval Of preparation there shall he as
| little possible of injury done to those Interests
conflded TO legislative protection IT you had a
new, altogether different state to deal with
in respect to system of banking, we should,
sir, claim, and be entitled 10 claim, Tor the pub
| lie the right of issue, well to claim the night
| to the profit upon that issue thear, hear) 1t
would be thus in our power TO prevent perhaps the
possibility of any grea. uctuation in the supply OF
the currency OF the country and to secure a just
equilibrium in all its component parts; shall read
to the house quotation from speech OF Lord AL
thorp IN this house upon the bank charter question,
in which he speaks OF the propriety of establishing
| a single bank of issue responsible to the state. |
quote from that noble lords Speech though differ
ing from him In respect TO points IN politics,
with the highest respect for his undoubted integn
ty; and IN regard to the soundness OF his principles
| in connection with our monetary system there Will
be in this house but enc opinion, namely, That no
| man rank higher, great cheering, particularly
| from the opposhon) "Another point Tor consld-
Grafton is whether the profits which must necessa-
ry be derived from the circulating medium OF The
country, should be possessed by government, or
should be allowed to remain IN private hands =
Now, sir, the advantages, the only advantages
| which nave been enabled to discover IN govern
ment bank, as compared with private company,
are those which result from having responsible per-
n III nj r. q
benefit OF It but then, on the other hand, Mhk
| these advantages are much more than connterbal-
anced by the political evils which @ont inevitably
result from placing this bank under the control Of
the government. think that the effect OF the state
having the complete control OF the circulating me-
dunn in its own hands woud be the most mischlev-
| GUS Under these circumstances, SIR, certainly
am prepared to propose the continuation of single
bank OF issue in the metropolis subject to the con
troll of the publicity OF their accounts. II we were
now for the inst time establishing system OF bank-
| ing which the country should proceed, ! thnk
| this would be the most advisable mode OF estab
fishing bank in the metropolis; but, sir, this pro-
position has the additional advantage-aud II IS no
mean one-that il will OCCASION the least change ;
because certainly OF opinion that, unless some
great advantage could be derived from change IN
| the monetary system of this country, nothing could
be more ill-advised-nothing could be more useless
than to depart from it." Sir, as to the impoiicy oi
having but one bank Of issue III the metropolis un
| der the immediate influence and control OF the gov
ernment at the present day, perfectly concur with
i the opinion expressed Dy my LOru AUnOTp. also
! agree with him that we ought, IN the attempt to
obtain the proposed advantage IN our monetary sys-
tenn, to use the means we already have provided 10
our hands (hear, hear) In acting thus, you will
have double advantage, II you do not disturb eA-
listing institutions in the attempt to accomplish your
| objects (hear.) The practical measure which j
have this night to propose the plan oil her Majes
tvs government, / shall now proceed 10 state. 1t
/ appears 10 me TO be OF great importance that We
should have one bank OF issue IN the metropolis
| which shall have increased powers. also am OF
opinion that II Is better to accomplish this Object
through the Bank OF England, (cheerlng,) rather
than through the medium OF commissioners ail-
pointed to controlsuch an estabishment-the Bank
to continue to the end OF IT'S charter, but the busi
ness OF the bank TO be divided INTO two separate
and distinct departmen ts the bank OF Issue to be
Iseparated from the general banking business, with
different books, accounts and officers That 20 the
bank of issue shall be transferred the whole amount
sue hereafter shall be regulated upon two prnol-
pes-tirst upon the definite amount OF securities
in its possession and, Secondly upon The amount
of bullion in its possession. That beyond tins It
shall have no power to issue lis notes. That thr
ordinary banking business shall be conducted upon
the same principles as other similarly constituted
bodies transact theirs. The amount OF fixed secu-
rites on which we propose the Bank should issue
notes, IL l,00O,00W; the whole OF the remainder
of the circulation to be issued exclusively on the
foundation Of bullion, which shall be Issued IN ex-
change for coin. iproposc that there shall be pc
| rlodlcal and complete publication oil me banking
have weighed matureiy the objections which have
been made to the frequent publication OF these dc-
counts and my opinion IL, that those objection
are without foundation. have the strongest ieei-
ing possible that nothing will conduce 10 The
credit OF the bank itself, and to the prevention 81
panlcs, and those injuries which have occurred,
than a complete and Immediate disclosure oi every
transaction in the banking department (hear, near
| would, therefore, propose TO enact by law thai
there shall be returned to the government weekly
accounts of the Issues of notes, the amount OF but
hon in the bank and an accounted the fluctuations
in the amount OF bullion, and the amount II Gepos-
ties In snort that such accounts shall be returned
in reference TO every transaction In the Bank Ct
England in the department oil Issue, and IN that o
banklngb by the Bank OF England and that The gov
ernme M shall publish unreservedly and weekly To-
| whole amount {hrar, hear) think. sir, II Wi
now be desirable, in order that ] may lay down lli'
| whole plan which we propose 10 follow more clearly
before the house, that should at once state wha
regulations propose TO establish with respect ic
other banking Establishments, aud then the arrange
menis which have been made with the Bank 81
England, with the terms made with that establish
mcnt, subject 10 the sanction and approbatlon oi
parliament. With respect TO banks OF issue III
England and Wales, being Others than the Bank OF
England our general rule will be to draw dlsn ne
ton between tho privilege OF issue and the conduct
of the banking business generally. We think that
IN regard To these points, they stand on an entiie
different footing from each other. We think Thai
the privilege OF issue IL one when may be laifY
aud Justly controlled by the state We think that
the privilege of banking is one III respect 10 which
there cannot be too unrestricted OF unlimited com
petition; we think that, in regard TO this point hc
Bank Of England should have no exclusive priyl-
| lege, and that all other banking establishment
might be fairly allowed TO act on the pnnciplr 81
competition. In my opnoa the regulations which
apply 10 banks OF ought not TO regulate mere
banking establishments or banks of deposiie. After
the issues take place, II is important that the public
should get the OF those issues on 10 cheapterm'
| IA possible. Sir, we propose that from thus tim,
no new bank Of issue shall be constituted beior,
which limit propose 20 remedy IN that particu
lar the evil We seek TO deal with; we do not pro
pose as said before, to extend this regulation I,
banks OF issue now existing. Sir, our object Is n
effect this great change with little injury 10 lndi
| yidual interests possible. ! repeat, we do not
propose to deprive existing barking establishment