The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1847-12-26

scarcely to be wondered at considering the extra
ordinary fluctuations which had taken place In the price
attributable to the mecalculatons Of those engaged
in the trade He considered IL unfortunate
that the bank had to the decision in September
to advance to the l4th of October excbequer bills
at five per cent The low rate Of interest had effected
but little alteration in the business of the bank itsef
but 1t acted prejudcialy In giving Ill grounded CON-
hGence to many parties connected with the money
market Up to the month of October last there no
ioadequacy Of bank-noe circulation, there any
difficulty in obtsinIng that usually given
ia the shape OF discounts by the bank The pressure,
ton from trade of available capital To show the
teat to which this had taken place the right
honorable gentleman first advertedto the amount which
had been ORA ned by purchases during the
last fifteen months The first cost of the import
ed from 1886 to January sa7. was f53o 900 Of that
imported from January to June or this year GA 10000
sud Of that mpor ed from July 10 October than
1920 900 making in all f33 C0000 paid for dur
ing the last dfteen months with the same view tee
right honorable gentleman then diverted to the euor-
nous railway expenditure which had taken place since
tne year s' This was one of the chief causes of the
present distress 1t being impossible that large pro-
portion Of the floating capital available for trade should
be converted into fixed capital without pressure being
caused As to the failures which had occurred parties
accounted for them In two different ways One party
attributed them to the stringent operation Of the bank
the undue abstraction of available capital and the
undue expansion of credit He left the House to judge
minding them that he had already shown that the
bank note circulation not materially contracted
the demand for accommodation on the bank had In
creased to an extraordinary degree, and caused
the bank to make the announcement which, at that
time had created so great sensation in the city Short
ly after this the government heard Of the failure of
some Of the provincial banks and of the formidable run
which had taken place one of the branches of the
Bank of England In addition to this It was under
stood that application had been made to the London
banks by some OF the Scotch banks for assistance In
this state OF things appealing to those
with commercial matters, the government found that
the opinion very general that serious calamity
would ensue unless the government took steps to
restore confidence 1t was with reluctance that he
came 10 the conclusion that 1t imperative the
rhursday aud Friday rsviously to the Saturday
which the government had 'cted very different
to the state of things from those which had
c.ived before. In determining to act two suggestions
were made to the COVER first to authorise an
additional issue Of notes. but to limit this additional ia
sue by certain amount. The other, that the limit
should be put on the minimum rate Of interest. The
later appeared the better suggestion
ment that eight per Gen should be that MI
ntmum, that, under the circumstances
The most desirable limit Unless the rate interest
fixed had been high the importation of capital bull
lion would have been checked. The removal Of panic
was the end which the government had In view and
step which they took was, in their opinion, the best
calculated to secure It. The result Of the Interference
which had taken place had bee prompt and beneficial
lie was happy to state that orders coming in
from aoroad-that the demand for cotton
and that the prospects Of the districts
were improving In addition to this, the exports the
United States were considerably on the increa'e and
the general trade OF the country being rapidly
stored to sound and healthy state 1t was urged by
some that the Interference should have taken place
carrier but In his opinion by such course the end of
interfering would NOT have been attained 1t was main
tanned again by Others but he conceived erraneousiy
that when they did act they should have acted more
largely and adopted extern led system
ton and currency. Taking again rapid review of the
causes OF the PRESSURE the right honorable gentleman
proceeded at some length to show that free trade
not answerabe for it, affected suppose-pres-
having afflicted the country when the
acts Of s Tss I baa h..n
ed in its day with as much vruence the latter but
those who now objected to 1t fortunately few and
select 1t objected to tho act Of ls4a that it had
not saved from revulsions in trade But one who
expected that it would do had any great
pursuit. Of commerce As to the Dsnk Of England con-
eidering the resources ct Its command and it's inhu
the business OF the country it was of the last
Importance that its action should be regulated by
sound discretion He was afraid that recent events
that institution. He deemed it unadvisable at present
however, to propose any legislation the subject
there was no subject the investigation of which reqnir
ed more calm elaboration and more impartial inquiry
But lie thought some such inquiry that
esfore COMMITTEES of the House absolutely ndispen-
sable in the present state CT the public mind II
srable that the proposed committee should be constitu
ted of persons various opinions whose coDoint abors
might result IN throwing some light on the complicated
problem sought to be submitted to them IL was not the
intention Of the government to propose any measures
embolyiDg the principle contained in the letter Of the
10th Of October the state of the bank being such
to render it highly improbable that any legislative inter-
ference shoud be necessary The right hon gentleman
concluded by moving tor the appointment OF the
mittee
Mr. J. WILSON then moved an amendment, limiting
the inquiry Of the committee to "bow far the
commercial distress has been affected by the laws regu
ating the issue of bank notes payable denaud and
In so doing agreed with the C anceor Of the Exchs
er as to the Imperative necessity which existed for the
appointment of the committee But ne deprecated ex
tending the Inquiry OF the committee to subjects
immediately connected with the great question which
was now agitating the public mind lie would confne
It's Investigation TO the Of banking and
cy There were also several points to which the public
mind now alive the first Of which had references 70
dad for tha u.rf
biity of bank notes wished to FIX the price of gold
But he denied that by attaching to gold the
nominal value of g3 lis lOkd they in reality fixed its
price, Tho next point had reference to this uury laws
Much inconvenience felt from the fact that por
ton of those laws had been suffered stil exist and
he believed that the committees If appointed, would
report Great Inconvenience had lately been expert
enced BY the importers Of the precious metals, who
recently found that they could not exchange silver for
notes An Idea therefore, abroad thgt the Bank Of
ENGLAND should be allowed to issue notes on silver,
whilst II would be obliged to pay them In gold But this
would be like permitting the Bank to notes on su
gar or any other commodity, auctuating Ia vauo He
did not think that the legislature had acted with dscs
ton In allowing the bank to hold any portion OF its bull
lion in silver, at the time of the passing Of the act
There was another idea gaining ground, to the effect
should always retain Ia its hands certain portion the
securities Of foreign States But such securities
changes In the hands Of private bankers than ia
OF the Bonk Of England As to the bank oct Of ISI4
hopes had certainly been held out that its effect would
De materially to lessen the probability of specua
tion and OF extreme nuntuston In prices that would
chs ok the which had taken place In the our
rency, and diminish the chances Of panic and pres
sure That these ons had been i'll founded the
Events OF the past two years amply proved The unda
error OF That act that those who framed it
coniouDded capital with circulation currency with bpl
non fhe object which 1t had In view was TO regulate
toe intern circulation OF the country by the
exchanges But this they should to do nor
should th-y do so could 1t be done successfully He TO-
tally denied the power Of the bank affect
lstion when IL pleased The act was based also
upon the assumption that immediate convertible
tv was not sufficient guaranty against the de-
probation Of the bank note But the convertible
bank could not ba. issued In excess, and i,
therefore maintained that its immediate converti-
bility was SUFFICIENT guaranty sgainst depreciation
MIR T DARiNs denied that the present pressure had
been. chiefly supernduced by over trading and
o,a mprovdence The want Of foresight attributed to
the mercantile world had not been confined to 1t; but
had pervaded alike the bank and the exchequer There
had been great Trading In aud In colonial pro-
ducs; but whilst he government answersble for
much OF the excess In the former 1t chiefly respon
sble for the losses in the otr, which mainly at
ributabie to It's colonial policy But II merchants bad
been in.provident, how came it that tho.e who