The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1866-08-04
English Banking.
From the Times.


That the operation of the English system of
banking is not at all satisfactory, every days
experience proves. There must be something
radically wrong and defective about 1t, and it
has been strongly urged that either Royal
Commission or a Parliamentary Committee
should institute a thorough inquiry with
view TO devise and propose measures of i'm
provement Lately ION the 18th of JULY a
deputation of the Glasgow Chamber of Com
meree, headed by the Lord Provost of Glasgow,
and accompanied by number OF members of
Parliament, waited upon the Lew Chancellor of
the Exchequer at his official residence in Down
ing street, for the purpose of supporting the
prayer OF memorial previously presented, that
an inquiry by Royal Commission should take
place into the working of the Bank act.
The statements of this deputatIOn, especially
Of MIR. Dunlop who appears to have been the
spokesman for the Chamber Of Commerce of
Glasgow, and also some remarksof MIR. Dsraeli,
the Chancellor of the EXchequer, allow Us some
insight into the causes of financial troubles in
England. With Mr.. Dunlops reference to
Adam Smiths theory, that banking should be
as free as trading, we have, for the scooe of
our present remarks, nothing to do. But he
makes the rather interesting point that ''bankers
IN Scotland conduct their business upon large
capital, and therefore upon principle OF safety
TO themselves and to the public. 1t is not
the same IN England, for "when Scotch bankers
had two millions of paid-up capital, English
bankers should have ten millions; but instead
OF that they had, perhaps, $500, 900 paid-up
capital" and that "the consequence was that
when the crisis came the English banks had
no capital to meet it, He claimed that banking,
that is, the ISSUE of bank notes, should be free,
and not monopoly, and that then only result
would be brought about which legislation could
not accomplish. Mr.. Bazeley, NJ. p, alluded to
the fact OF "the rapid absorption OF floating
capital, which had been placed IN liked position,
and which might be said TO be almost iIremov-
able" and then he said, that San act which
required to be suspended continually could not
be regarded as sound or satisfactory Mr.,
ACkbOyd NJ. p, called attention TO the remark
able circumstance that, while the bank kept It's
rate OF interest up TO ten per cent, tor tie
avoWed purpose to bring flow of gold to
England, the drain OF bullion to France had
actually increased to 100000 the previous
week, while the rate of interest in France was
but A per cent. "How," continued the hon
orable gentleman, "can we account for the
fact of that sum going from country in
which money was 10 per cent to country in
which II was per cent! There is evidently
some cause at work other than the rate OF dis
count In fact, there was a strong feeling that
the mode adopted by the Bank of England TO
strengthen their position mad a contrary effect,
and confidence in our banking system has been
shaken at home and abroad" Mr.. Graham, M.
p, asserted that Sin almost every part of the
country there was feeling among the mercan-
tile community that there was something in the
machinery not working smoothly and efectu-
ally,n The chancellor of the EXchequer, in reply
alter expressing himself favorably upon the pro-
position for a Royal Commission OF Inquiry,
gave it as his opinion that 'the evils that we
must all acknowledge to exist the embarrass-
| ments that most Of us feel, arise from deeper
causes than mere banking arrangements" and
| that "tbese causes are more extensive than is
| generally supposed, and that sit is want of
capital and not want OF currency" England is
suffering from. The interview shortly after
| terminated. a-.. ."
| We thought this, conversation important
| enough TO give it this prominence. The Bank
| Act OF Sir Robert Peel, passed In 1874 has often
| Leen attacked in and out OF Parliament. 1t is
said OF II that instead Of checking 1t is cOntinu.