The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1855-11-10
y injurious, and not groundeS

Sfo P1vv'V" e.1uiev iDyuiiooSi anu not Sroun0oS
That ia le47 these provisions were practically
understands such matters for moment doubt that
all the bullion would have been drawn ont Of the bank,
and the notes issued the fourteen millions OF govern
ment debt could not have been paid.
S. That great fluctuations have taken place in the
amount Of bullion held BY the bank since the passing
time u the Of bank aotes in crcu
ation and thus TO create great distress and
and a other times peng the bank to purchase gold
and thus vastly to increase its circulation thereby
ing rapid rise in the price Of all property aud labor
and thereby creating temporary a ZIP G 70 oe 81.
Necessarily producing such ex or of gold and that
port compelling the bank agar to reduce the amount Of
their notes great distress and bankruptcy become again
g. That the proessed object Of the Cover nnent in pro-
posing the Ban Charter Act Of 1914 mitigate these
Fluctuations end as far ~ possible to stea H.
Of prices and as consequence steady and profit
!. That such effect has been produced The disco.
very OF gold and its inued Influx has great de
gree lersensd these fluctuations and peventc the whole
s. That the question is--will the supply Of gold
continue ruch as TO enable 10 meet the unavoidable
immense dram caused by the var aud to retain suii
Gent gusatt'y for the foundation uf crc medium
adequate 20 the wants ~ fhe ionf
= That this drain win te greatly increased by the
c6ssary import If corn occasota by what is longer
doubis great falling OF in tho crop OF whoa. for the
TO- That The Bank of England seems to bc quite aware
q tbs and IS already taking most dcci led steps to check
the demand for gold by enrtsing toe issue Of their
thus Induce the export Of goods ntber thnn Did
IT, That IT cannot now be stated that these steps are
called Ter by any Wild, dangerous sp@cuaiions in this
country for trace Il known 70 be moe free from pecua
lion th.a L has long been.
IL. That this drain is mainly caused by the Turkish
loan, measure proposed ny govetnmen ane az their
request saoctioncd by fafhament; secondly by the
amour. Of gold required 80 pay oa troops In foreign
oanntrcs And now ny purchases az wheat being made
in every quarter Of the world where II can be found
10; That. however str neent sreb may De- it
would sppsar impossible tina, the drain Of gold from
u
the act OF ls%a
-. That ii a much larger amount of gold from tho
mines than has hitherto the be not ifuuied
stey produced, the bank I'll, De compelled IL fde-
enes On vhs. VII prove vain effort 70 maintain the
70 point which will occasion commercial
fusion, bankruptcy and distress, and render the pay
monetary engagement, the employment Of iabor. aud
seeoins the I,ecpse, utterly impossible.
IL, That the means sn.biing the country 70 carry
ami bring 70 puccessfu issue the late war were fur.
n-hed BY e adoption Of exactly contrary OF
conduct The part Of the bank than that wheh by the
charter OF iS13 the bank Il compelled to ADOPT the
issue u il. NOTES being then aot restricted % The
amount q bullion whica happened To be lie Golfers
but ISSUED 70 IN extent commensurate With the
vantaof the government and the legitimate require
ments "a commerce
To- That the present Law, by permitting the bank t.
issue ke.i smognt-fpurieen mions-of notes on mere
cebt and above the notes for which bull
Iron Is he'd in deposit has proved that. In times of
peace, these wants ard requirements cannot be met by
circulation limited by th. amount Of gold 10 the bank
IT, That nasmuch one main element Of price is The
~
maniiestiy unjust, by diminishing the amount of
legal tender pounds arhcsy to depress prices Of all
property, and propoonat, 10 enhance the burden of
asaton ari al ether monetary eugageneat, merely be-
cause a occasional fluctuations In the amount Of one ar
ticle--s'xo.d.f
is. That the object be accomplished 4. to provide
and maintain sufficient steady circulation 81 leg en-
der money fori all internal affairs at pfe.en opera
tons which the public foreseA and over which
they exercise control, az derange ala
sting cona acts, and greatly e,dsuger IN. beat Interests
of the couary A. long as gold & be only ,uudatn of
IN. kepp 81. Hx anf.
ctnt circulation In time 81 peace II has been found
impossible 70 30 so how can u be possible in lime q
TnE BANK OF KNoLASD CHARTER ACT isit
from the london Economist
" cannot be matter for sarpis a such luneture
that public attention should be called 20 the Ban
1874. We shall not be suspected after tue resistance
which almost sinee-hsnced we offered TO that enact
ment 81 the time Il was passed AID thc numerous
soas Which have since pintet oct it, defects Of
any desire 70 shield II from FIJI ample ai.csssi At
the time, IL Il but too eyiuent tha the t ec Il
being approached in the heat aud excitement q:
most exaggerated alarm which are III calculated to
for Il safe solution the truth is that there are
many classes directors the act Of 1874 who eney
disagree with each other up,p the Fundamental
grounds .. their objection. The act e 1915 wa
.aid by it authors 10 be tie complement 81 ths sc
VI 1919 'ae eontended tina, the deprecistoa tauA
notes not provted against by provision for their
OF 1874 necessary that object We among
others have oontended against that do Urine and against
the restrictions Of he act II 1871 being entirely
NECESSARY sor their protested object which vas suite
ce-ty seeu-ei hy the act At 1910 and imposing az
TIE discretion OF the bs nh DIRECTOR which
tier operation either useless mi chic hat
here Ia another class OF To the OF isi With
more than any theorists upon currency guoti
disag7ee viz those who contend for ineonyertbi,
bank notes without limit and therefore opposed
the act Of 1870 and 20 'he act Of 1874 ony bocRuse
makes thai ~ 1919 stIiugeu, And We are bound
to .oy that the argument drec ID again tho isi
by many who would not admit their opposition tst 81
1910 would carried 10 thelr Legitimate coaclusion G
in m inconvertible paper currency.
The Truth is, that one who bscyes In the Necessity
Of conyeribiity ho~eyer much b. may office, 20 thf
J.atsg t.tasf a..
refuse to recognise the justice of tho original pne
ple upon which il i based, can faV to that with
out any act Of Parliament, the Bank would be equally
hound 10 regard that prii cipe while however II fould
be exercised by unbepding and iron rule. but ty
sound discretion from time TO WAT is that prin
ciples II il simply that the Rank Of Fnel md having
large obligations in the shape 81 bank notes aud opposite
al payable u any moment ON demand shall keep such
reserve Of bullion IN Its Golfers as shall enable u at al
times 10 meet It's Hal tiles; hat II, that the convef
bity Of bank notes ard the payment II deposit shall
always be secured. But in order 20 gain these objects 80
say that is is necessary, whatever the circumstances
may be, whether drain Of gold is progressing has
been arrested whether trace il sound or unsound
whether .nport have been n excess or not whether the
dividends TO be paid the following week At
remote time TO maintain certain fixed and imuoveab.e
relations between the notes in circulation and the bull
lion in the bank Is simply 70 discard alt Judgment and
discretion IN the management Of the bank and to expose
the public At tines il may he to the most needless pres
sure and inc0nvenience-an inconvenience too created
mainly by the aarm consequent the provisions of the
hen isa na,c vas enie,y ~ letter from ~.
70 the bank authorizing the suspension OF
the act, although after all s provisions In
vaded.
That II l. imperative upon the bank to retnn q sum.
cient stock Of bullion TO the converbility OF
the notes and the repayment OF deposits all sound
thinkers win readily admit. But that the pro.
portion Of gold to the banks liabilities il, under all
circumstance required for that purpose few who
have reelected upon the subject will contend Yet such
is the act Of 1874. But anxious not 10 confouni
With the objections to that act the fundamental duty
every banker and Of the Bank Of England like Others
~ retain sufficient 10 meet all demands upon
them. The sovency. of banks rests more upon an Oh
Of thus rule than upon any other. Let for
moment trace the chain through all its links from the
small trader up to the Bank Of England ana shall ind
that all Who prudent act upon the principle
and that all ultimately Dependent upon he
gold held by the bank. trader in the provinces finds
necessary always to have certain amount within his
command 70 meet his liabilities; he keeps tain cash
balance but he keeps certain further bills Of
exchange running towards maturity these he regards
cash, because he relies upon his power discount
them A. they wanted with the provincial bankers
the provincial banker In his turn keeps certain re-
IN each but he relies to meet unusual demands IL
they afise upon his ability TO rediscoun biIls In
l.yd 4s-aet To soil troka