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Bank notes, the velocity of its circulation will appear to be most truly astonishing."
It will be seen that by the arrangements to which allusion is here made, the sum of 220,0001. daily performs the operation of nearly 5,000,0001. or 20 times its amount.
But he had further information to lay before the house upon this very important branch of the subject.
It appeared by the papers before them, that the average circulation of Bank of England notes in the year 1818 was about 27,000,000.
He had called for an account of the number of Bank notes and Bank post bills of each denomination, issued in that year, and he found they amounted, together with those reissued, to between 25 and 26 millions in number, and that the emission from the Bank of these notes of all descriptions in the course of the year amounted in value to nearly 240,000,0001. Of these the 11. notes constitute about 20 millions
-the 21. and 51, notes, which had no existence in 1792, about 10 millions more—and the remaining 210,000,000 may be compared with a similar account made up of the circulation in the
It will perhaps surprise the House when they learn that of the circulation of the larger notes in the year 1818, the number of 10001. Bank notes alone amount to 112,000, and represent in their issue from the Bank, 112,000,0001. : that is, nearly the half in value of the whole of the Bank issue in that year.
In the year 1792, the number of notes was 819,300, which represented in their issue, nearly 75,000,0001, sterling. The number of 10001. notes was in this year 40,000, representing, according to this calculation, about 40 millions.
But there is another paper, which is drawn up for the purpose of ascertaining the number of days that a Bank note of each denomination remained in circulation, at these respective periods.
In the year 1792, the notes of 10001. remained out, upon an average, 22 days. In the year. 1818, only 13 days. In the year 1792, the 101. notes remained out 236 days; in the year 1818, 137 days. In the year 1792, the 3001. and 5007. notes remained out 24 days; in the year 1818, 14 days. In the year 1792, the 1001. notes remained out 84 days; in the year 1818, only 49 days.
As he should move for these papers to be laid before the House, he would not trouble them with further particulars; but to whatever qualifications these calculations may be subject, the House would see, from what he had already said, what an astonishing improvement there was in the means of accelerated
circulation in the course of the last 30 years; and how small a comparative proportion of currency might therefore be now necessary, compared with what was formerly required for the same purpose. These principles might be applied still more extensively to the circulation of the country than to that of the metropolis.
In the metropolis, the transactions have been, for a century, carried on, in a greater or less degree, by the , medium of paper; but in the country, the paper circulation is in a considerable measure a recent creation : and the facilities of using it with economy have been in a course of improvement from year to year.
Upon a subject of this nature, it was obviously impossible to fix any nice proportion; and if he was asked what was the only criterion of a circulation being sufficient or excessive, he must answer, that it could be found only in its value when compared with the precious metals.
Whether a paper circulation should continue for small payments, in combination with specie, was a question of expediency; but if it was to continue, its real value could only be ascertained by its convertibility into specie. It was a most singular circumstance, that in one of the most populous and commercial parts of the kingdom, in the county of Lancashire, where enterprise
kind was carried to a greater extent than in any other district in the island, the greatest part of the circulating medium was carried on by bills of exchange ; and when a respectable and intelligent individual connected with that county was asked whether any inconvenience resulted from that system, he replied, “None whatever.” The tendency of this was to show, how little well founded was any alarm respecting an insufficiency of circulating medium. Whatever temporary inconvenience or distress might arise from any
sudden change, he was satisfied that where there was real and substantial wealth in any county or district, that county or district would soon find a circulating medium for itself.
He had explained to them what ingenuity had already accomplished in this respect, and he repeated that the same spi rit of enterprize and talent which when directed to mechanics had discovered the powers of the steam-engine and the spinningwheel, and had applied them to the purposes of life, had been found not less successful in devising means for circulating the property of the country in the most expeditious and profitable
There was only one remaining point to which it was necessary for him to advert, and which he should do in very few words. He alluded to the opinions which a Noble Eari had
embodied into the Resolutions he had moved respecting the Mint regulations.
The Noble Lord would have an opportunity of explaining himself upon this subject, and there were others who would follow him, who would be fully competent to comment on what he might offer on this part of the subject.
He would beg leave only to refer those members of the House, who were desirous of being informed upon this part of the question, to the evidence, in the Appendix, of Mr. Page and Mr. Fletcher on one side, and to the very able and as he thought satisfactory evidence of Mr. Mushett on the other.
He could conscientiously say, that he had felt most anxious to hear and consider 'every thing that could be offered on this point. He had heard the Noble Earl over and over again he entertained no more doubt than he had done at the commencement of the inquiry,‘and he had the satisfaction of thinking that several Noble Lords who had doubted, now entirely concurred with him.
He could perfectly understand that in countries where gold and silver coins were both of them legal tender to any amount, that if the proper proportion was not observed in the value of the metals, the favoured metal would come in, and the other go out; but in this country where the Mint was not open to the public for the coinage of silver; where Government kept the silver coinage in their own hands; where its amount
so limited as not materially to exceed the necessary demand of the public for it as matter of exchange; where silver was not a legal tender for more than 40s. he really could not understand what the Mint regulations regarding the silver coinage could have to do with the state of the exchanges or the price of gold-how it could be supposed that 27,000,0001. of Bank of England paper, and 23 millions of country bank paper could be the representative of a silver coinage not legal tender beyond 40s. and in its total amount not exceeding 4 or 5 millions, was beyond his imagination to conceive. The principle advanced, if true, would apply equally to our copper coinage-it would apply still more strongly to the old silver coinage, which, although depreciated by wear to nearly 30 per cent. was nevertheless legal tender, at least to the amount of 251. and yet never banished the gold from circulation.
In fact, when so depreciated, a premium was orien given for it, from its smal' amount in quantity, and from the use of it in small payments
He had now introduced this important subject to te consideration of the House in all its different bearings. He felt
VOL, XIV. Pam. NO. XXVIII. U
most desirous that the House should concur in the Report and recommendation of their Committee.
They had proposed the plan which was now before the House, from a conviction that it would attain the desired object without material public inconvenience; they were deeply anxious that the country, ould return to some fixed standard of value; they were anxious to return to the ancient standard of value; they were anxious to return to it with the least practicable delay; they were anxious to return to it with the least possible distress. It was because this plan appeared calculated to obtain the object, by certain but progressive steps, that they had recommended it to the House. It insured an early, though not an immediate commencement, and that at a standard which now existed.
The measures which were to follow were all to be taken so gradually that the operation of the latter parts of the plan might take place almost insensibly, even if the precaution of some contraction in the circulation should be necessary for that purpose. His own persuasion was that no such contraction would be necessary; that most, if not all the inconveniences which might arise from the experiment had been incurred already; and that if parliament would steadily adhere to the course recommended, they would see the antient standard of the country restored without material distress to any class of his Majesty's subjects.