The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1866-03-23

Currency and FinaRce-The Financial
Centre OF the WorfA-Ba rom Roths-
child's Evidence.
We published a few days ago the highly in
teresting examination of Baron J. de Ro.hs-
child by the Superior Council of Com.
merce at Paris, on 'the principles and
general facts which regulate monetary and
paper circulation" The we'll known character
and position Of this great financier give much
weight 10 his testimony. The President of that
important body before which he testified, M.
Rouher, seemed to fully appreciate this when
he said to NJ. Rothschild, "On account of the
extreme importance Of your opinions, and of
your great experience, think it useful to refer
to certain points," And again, at is, there
fore, not for MS that you speak, but for the pub
Lie, who will read the documents we shall pub
lish. You must understand the importance we
ascribe to opinions expressed by such an i'm
posing authority as you are ON such matters"
The subject that chiefly engaged the atten-
ton Of the Council, and about which they
inquired of M. Rothschild, was as to the posi-
ton and principles Of management of the
Banks of France and England and their power
The object appears to have been to ascertain
how far the Bank of France could extend its
power and usefulness, both in the empire and
throughout the world, by any modification of its
present system. The Council seemed particu-
larly DESTROYS Of knowing to what extent it
could be made to rival the influence or take
the place Of the Bank of England. This led to
comparison of the two great national institu-
tons, their systems and their influence, and
elected much valuable information, not only
for the people Of Europe, but for the whole
world. We especially may learn a good deal
that is useful just at this time, when we are
passing through mighty financial revolution,
and when mems ideas here are so vague and
unsettled upon the subject
That which should attract our attention most
is the controlling power of these great national
banking institutions, and particularly of the
Bank of England, over the trade, commerce
and financial conditions and operations Of the
world. By studying this we may adopt prin-
ciples that are applicable to our own situation,
so as 10 give us that high standing in monetary
affairs to which our wealth, resources, geo.
graphical position and the greatness of the
country entitle us.
Baron Rothschild does not hesitate to say TO
the French Superior Council Of Commerce that
"the Bank of England leads all the other
banks of Europe. When money is seen to be
rare in England people open their eyes, not
only at Paris, but at st. Petersburg, and every
where. The situation is quite different from
ours. The measures taken by the Bank Of
France do not produce the same effect abroad
as those taken by the Bank Of England" In
another part o. his evidence he says" A ver,-
table bank is the Bank Of England II is fiom
IL that emanate, SO to speak, all little banks"
Contemplating the Immense power of this
institution. which makes London the money
centre of The world, we are naturally led to in
quire the cause. How has this state of things
arisen, and how is it maintained!
II does not come within the scope Of this
article to investigate the history Of the Bank
| Of England, or all the causes that have led
SUCCESSFULLY to It's present powerful position
nor ia It necessary. We refer, however.
in another part of the paper, to some
Of It's struggles in those trying periods
when efforts were made to return to
| specie payments. There are few general
principles that have operated to produce the
result, and which must govern in all such
cases. These we shall notice. The strength of
this institution lies primarily in Its connection
with the government. Strictly speaking 1t is a
private corporation, or a corporation Of indi-
viduals but the government has always been
| identified with II and exercised a control over
| its affairs, particularly In critical times. The
bank, at the same time, has paid attention to
the wishes and necessities Of the government.
| They have mutually aided and sustained each
other for the public good. This, however,
has been less through positive or express laws,
or through provisions in the charter, than from
mutual interest and selEpreservation. The
relations Of the bank to the government are
based upon the principles Of necessity aud
convenience more than upon an express formal
compact, or any direct right to claim sup
port on one hand or control on the other.
Like the binding force OF the British constitu-
ton upon the people. these obligations be-
tween the bank and the government are based
upon fundamental principles of what il just
and proper more than upon any written com
pact. Both form beautiful system of checks
and balances which are tacilly acknowledged
and submitted to for the welfare of the country
But though the bank has this connection with
and support from the government. II is not
like the old United States Bank. OF what our
present national banks may be--a dangerous
political machine. II comes to the rescue Of
the government 10 times Of war or OF any greai
crisis, but II does not exercise power in the po-
ltical affairs Of the country, nor is il dangerous