« PreviousContinue »
credit of the whole terrupted, would be carity of payments in
detail to prove that any sudden révolution in the transactions of the bank of England, by which the regularity of payments in London should be interrupted, would occasion a shock to the credit of the whole country, attended with the most pernicious consequences; and to prevent this, the bank is under the necesą, sity, he says, of always maintaining her accustomed quantity of nöteś. But it will appear that, in this answer, Mr Thornton has confounded two things together, of which the difference is pe. culiarly important;-he has confounded together the discounts of the bank and the currency of the bank. There is no doubt, that any considerable interruption to the regularity of the great payments in London, would occasion a shock to the general system of credit, which is anxiously to be avoided. It is very evident, too, that the bank, by withholding suddenly from the merchants those accommodations which they have been accustomed to rem ceive, would produce that interruption. But wherein does the accommodation which the merchants are accustomed to receive from the bank consist? Most evidently in affording them loans,-not in giving them one kind of currency in preference to another.
If the bank, according to the foregoing supposition, has regularly afforded loans on bills to the amount of 15,000,0001., any considerable and sudden reduction of those loans, might produce the most serious consequences. But let her discounts be regularly maintained at this level, and she need give herself no trouble about the currency. Currency is a thing which always, and infallibly, provides for itself. Now, we have seen already in what manner a run upon the bank for guineas affects her discounts. If she persist in keeping out the usual quantity of notes, her discounts must be daily enlarged to the whole amount of the notes which daily return upon her for gold. But if the notes which come in for gold are merely not issued, her discounts remain invariably at 15,000,0001.,--and her business of discounting proceeds without any alteration. If the demand for gold continues till any considerable portion of her notes are withdrawn from circulation, what remain are not sufficient to retire the bills in her coffers which are daily becoming due; they must be retired, therefore, with gold ; and, when this happens, she then begins to res ceive with one hand what she pays away with the other, and the drain upon her can proceed no further.
Mr Thornton, indeed, says, that as there is never any doubt about the credit of the bank of England notes, the guineas are drawn away. to supply the discredited notes in the country. But to suppose that guineas could be accumulated in the country, and yet be impossible to be had in London, if there was occasion for them, is too absurd to require refutation. The guineas which YOL. XIII. NO. 25...
are drawn from the bank of England to be sent to the country, are all drawn by the London bankers and money-dealers, in the first instance ; and if there is any demand for them in London, there they will remain. Would a London banker send ten thousand guineas to the country to accommodate his correspondent, if to-day, or to-morrow, he had bills to that amount falling: due upon himself, which he had no other means of retiring? Indubitably he would not he would retire his own bills in the first instance, and leave his correspondent in the country to shift for.. himself. It is evident, that little or none of the gold issued by : the bank would go to the country, or any where else, till the cir-. culation of London was completely supplied.
It appears, therefore, that there is no danger to the regu. larity of the London payments by diminishing the notes of the bank of England, provided she diminishes not her discounts; and, were the demand for guineas to continue so great as to exclude her notes from circulation, she could only be called upon to find a quantity of gold equal to her 15,000,000l. in notes, to afford the whole of the usual discounts, and preserve the regularity of the London payments. Even then, too, she would be in no worse condition, than the rest of the banks who discount without issuing notes, and find it still a very gainful trade. But it is perfectly certain that she could never be called upon, while she confined her business to the discounting of bills, for nearly so great a quantity of guineas as her notes amount to. It is al. ways found, that when a bank can stand, with every demonstration of ease, a run for but a few days, confidence is restored, and the drain is interrupted. As to the drain which may arise. from the exporting of guineas to foreign countries, it is perfectly evident, that the smallest increase to the difficulty of finding them at home gives them a value, which entireiy prevents that operation, and even brings gold from abroad. Mr Henry Thornton enters into a long explanation of the difficulties and delay of bringing bullion from abroad ; but he completely forgets' another very obvious circumstance, that the delay and difficulties are equally great of drawing gold from this to other countries; and that these two sets of difficulties, therefore, exactly balance one another.
This doctrine is entirely confirmed by the facts connected with the crisis in our pecuniary affairs during the year 1796, and the beginning of 1797, when the suspension of payments in cash took place. From the end of 1794, or the beginning of 1795, there had been a rapid increase of the advances to government, insomuch, that these advances had risen, in the course of a few months, from six to ten millions; while the cash and bullion in the bank had, during the same months, sunk from eight millions.
to five. During this time, the directors of the bank continued to make loud and frequent remonstrances to the Chancellor of the Exchequer, on the dangers into which the bank was brought by these extraordinary advances, and earnestly to implore that they might be reduced. So far, however, was this from taking place, that from the urgent demands of government on the one hand, and the compliance of the bank on the other, they were carried, in the month of March 1796, to the enormous amount of 1.1,351,0001. From September to December they were reduced about a million and a half, but, after that, began again to rise ; and on the 26th of February, when the 'cash and bullion in the bank scarcely exceeded one million, the advances to government, including interest, amounted to 10,672,490). For a little time before this memorable juncture, the governors of the bank having no command over the money advanced to government, endeavoured to draw in their notes by lessening the amount of their discounts; and, by this circumstance, not by a want of currency, produced that derangement and difficulty in the London payments of wbich Mr Thornton complains. I'rom the end of December to the 26th of February, the quantity of discounted bills had sunk from 3,796,0001. to 2,905,0001.
· The conclusion froin all this appears abundantly certain. If the bank of England, provided she never made advances to government, could not, as we have already shown, be ever drained of gold, unless she chose, beyond the amount of her notes in circulation,-and would not, to a moral certainty, be drained to nearly so great an amount,--and if we find her in advance to government, to a pitch so enormous, when she became plunged in , inextricable difficulties, is it not clear that to these advances the difficulties must have been owing? It would have given us great pleasure to have entered upon the analysis of this case likewise, and to have traced the operation of these advances, step by step, to the crisis which they at last produced. But we have already so far exceeded all reasonable limits, that we are absolutely precluded from an inquiry, which would still lead us to a considerable length. Besides, the principles which we have already laid down, may be applied. by any one who is at all accustomed to these inquiries, in the solution of this case, which presents no peculiar difficulty. In the mean time, we are extremely happy to present to those who are not accustomed to follow a train of reasoning, and who have a strong propensity, in this country to treat it as nonsense, something which is well calculated to make a deep impression upon them. It is the testimony of the Governor himself of the bank of England, in express terms, aflirming the conclusion, to which, by the preceding inquiry, we have been led. A secret committee
of the House of Lords having been formed to inquire into the circumstances which led to the suspension of payments, the Governor of the Bank was, on the 24th of March 1797, examined before that committee (see the Report of the Committee, which was printed and laid before Parliament), and delivered his evidence in the following remarkable words.
Q. Have you, at any of the conferences you have bad with the Chancellor of the Exchequer, as Governor of the Bank, made representations to him of the danger to the bank from the diminution of its specie ?
Q. Can you state the dates of such representations ? ( Ă. There are a variety of dates, but I cannot recollect them. I think the first by the bank was in December 1794, when I was directed to make such representations.
ol. Do you conceive that every exertion has been made by the bank to obtain repayment of the advances made to government since the 1st of January 1795? • A. Yes, save that of lending more.
Q. If, in consequence of the various remonstrances that have been made to the Chancellor of the Exchequer, the advances by the bank to government had been either paid off or greatly diminished, do you not conceive it would have enabled the bank. to regulate, at their discretion, the amount of the bank-notes in circulation ?
A. Undoubtedly. "Q. If the advances had been either paid off or greatly dimi. nished at the periods you applied for such payments, do you think the necessity of the Order in Council [for suspending the payments in cash] of the 26th of February would have existed ?
A. Had the advances to government been considerably less, I do not think the Order in Council would have been necessary,
We ought now to proceed to the last part of our author's disquisition, namely, the subject of exchange ; but we have enlarged to so immoderate a length on the important and compli-. cated topics, which previously occupied our attention, that we must, for this time, entirely omit this collateral inquiry. The peculiar errors which Mr Smith has committed by the application of his doctrine of the ideal standard, it will be easy, after the examples which we have presented, to detect; and, with this precaution, the reader will find several acute and very sensible re marks.
ART. IV. Fowling, a Poem in Five Books, descriptive of Grouse,
Partridge, Pheasant, Woodcock, Duck, and Snipe Shooting. 12mo, pp. 150. Cadell & Davies, London. 1808.
THOSE who find something very admirable in “ The Chase,'
should be pleased, we think, with this poem. It is less raised, indeed, by common places of classical allusion, by formal similes and artificial digressions, than the popular work of Somerville ; but it is marked by the same knowledge and love of the subject, by the same accuracy and truth of description ; and is animated, throughout, with something more of a natural feeling of the beauties of rural scenery, as well as a greater simplicity both of conception and expression.
To us, indeed, the greater part of what is called didactic poetry, appears to be a very dull variety of the mock-heroic; and we cannot help fancying, that there is something intrinsically ludicrous in four or five books of lofty and rapturous blank verse, either upon hunting or shooting. Pursuits which are followed for mere amusement, and which necessarily give place to every call of duty, affection, or business, evidently possess in themselves a very subordinate and secondary interest; and are therefore by no means the most natural or advantageous vehicles for awakening the sympathies of mankind by those lofty or pathetic sentiments which constitute the soul of poetry. If shooting and hunting are legitimate subjects for poetry, so are cock-fighting and foot-ball; and if occupations are to be magnified in verse, merely because idle individuals enter into them with great relish and animation, we need not despair of seeing a regular didactic poem under the name of · The Tavern,' or · The Bathing Ma
Though poetical talents are misapplied, therefore, to subjects that can excite no powerful or reasonable interest, yet those talents may still be displayed upon such subjects. Accurate and lively description will always be delightful, and no subject can be fairly denominated unpoetical, which holds out an opportuni. ty to expatiate on the beauties of nature.
Comparing the subject of this poem with that of Mr Somerville's, in respect of their poetical capabilities, we would say that the latter was more picturesque, and the former more romantic. The Chase, with its neighing steeds and opening hounds-its horns and halloos—and the rapid sweep of its gay and crowded followers, certainly presents a more animated picture to the fancy, than the solitary pedestrian, creeping cautiously with his gun and pointers from field to field. The very loneliness of the fowler, however, and the silence in which he stalks from thicket to hill,