Weguelin, who was then governor of the bank, to sir george lewis, who was then chancellor

What then, subject to this preliminary explanation, is the amount of legal tender held by our bankers against their liabilities? The answer is remarkable, and is the key to our whole system. e. while the corresponding figures at the present moment are–circulation, 60,000,000 L. No doubt there is a vast routine of work to be learned, and the manager of a large bank must have a great facility in transacting business rapidly. On principle, if there was a perfect division of labour, every industry would have to be perfectly prosperous in order that any one might be so.

The term banking was then applied only to the issue of notes and the taking up of money on bills on demand. Under any system of banking there will always group themselves about the main bank or banks (in which is kept the reserve) a crowd of smaller money dealers, who watch the minutae of bills, look into special securities which busy bankers have not time for, and so gain a livelihood. 16. The greatest stress is commonly placed on the first of them—the trade balance. That discussion was terminated by the Act of 1844. . All which the best board of directors can really accomplish, is to form a good decision on the points which the manager presents to them, and perhaps on a few others which one or two zealous members of their body may select for discussion.

India keeps a somewhat higher proportion of her reserves in foreign credits, and keeps some part of these credits in a less liquid form. Payment of dues to the Government could be made in the currency notes of any circle; and railway companies could, if they accepted notes of any circle in payment of fares and freight, recover the value of them from the Government. And there could be no sort of conversation more injurious to a man in the City; the world there would say, rightly or wrongly, ‘We must never be too severe on errors of judgment; we are all making them every day; if responsible persons do their best we can expect no more. Most men of business think–‘Anyhow this system will probably last my time.

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