Evening star., 1960-12-07
TALKING VI bUoiNESS
LordC Cromer ~, is Youngest Boss
OF Bonk of England in 200 Years

on the Court" or board of di.
rectors for the Bank of Eng.
land. w..
Social Structure q Factor
There is q fundamental diff.
ference between Mr.. Martin ant
Lord Cromer, however. In (
nutshell, Mr.. Martin is inde,
pendent, Lord Cromer belong
to a fraternity.
The distinction grows partl!
out of their jobs, partly out o
the. British social structure
The Federal Reserve Board b!
law is independent of the Whit,
House and responsible to Con
gress. 1t takes orders from
neither. Mr.. Martin has mad,
that clear in resisting pressure
from both sides on the issue o
tight money"
The Bank Of England, on tn,
other hand, technically looks t.
the Chancellor of the Ex.
chequer. .i.e,, the Treasury, fol
ultimate authority.
The British law says thu
Treasury may from time t.
time give such direction to tn,
Bank as, after consultation with
the governor Of the bank. they
think necessary :"
In practice. British admin.
strations don't use this power
preferring to rely on informa
talks and voluntary co-opera.
ton. The Banks boss mus
have character, but he alsc
works with other agencies. 81
does Mr.. Martin, but its q
question Of degree.
! Member Of Establishment"
| Lord Cromer is. in fact, Z
fraternity man. He belongs ts
the Establishment" an un'
oficial phrase for the small
elite ruling group in England
To be member, one must at
tend the right schools. join tn,
right clubs, distinguish onesel
In some field of service.
In all these respects Lore
Cromer has qualified-Eton
Cambridge, lieutenant-colone
in the esteemed Grenadiel
Guards in World War II, ant
a family name identified will
merchant banking for many
generations.
Differences in Systems
/ Here are some other ways IL
which the Fed differs from it
British counterpart:
The Governor Of the Banl
of England wields his authorit!
in a more personal way. Con
slider, for example. the Fed
! job of applying policie
affecting some $4,000 banks il
IL districts sprawled across /,
continent 5000 miles wide. B,
contrast the Bank Of Englant
deals with only five houses
called Clearing Banks, which
; in turn relay orders t.
branches. Since the country i
small, these five are all LOCATED
in London.
It's not unusual with thiI
intimate set up for tn,
Governor to call in the head
Of the Clearing Banks and sa,
something like. Look I thinl
you chaps are going q bit strons
on consumer credit. We ough
to cut it down."
Mr.. Martin has immens,
power too, but it's used a
arms length. not in this init
mate and fraternal way.
. The Governor has NOR
direct. undiluted authority owe
his Court" of II men. The.
serve somewhat like advisers
AS chairman Of the Fed, Mr.
Martin acts as its spokesman
but legally he has only one vot,
among seven. His position il
more like that of Chief Justic,
in the Supreme Court.
Also, the Bank of England i
physically more compact
Where the Fed is decentralized
divided into IL geographical,
distinct districts and IL Reserv,
Banks with some 1870 person
theoretically influencing tn
decision-making process, tn
central bank in London ha
just two buildings. one of then
on Threadneedle street.
Hence its ancient nickname
The Old Lady of Threadneedl,
Street,
. Last, the Bank of Englant
manages debt. a job handled
here by the Treasury. TIL,
British bank decides which
securities to issue and the.
sells them on behalf of tn,
Treasury. Curiously the Chan
cellor of the Exchequer wear
two hats In England. He's botl
Treasury Secretary and Bulge
Director. OOSiti0nS that kea,