_rupee reserves_ are held partly in the currency reserve, partly in the gold standard reserve

And the tightness so produced is often greater than, and always equal to, the preceding unnatural laxity. If the demand is large and the minimum rate of allotment high (say 1s. 16.

The poor demand for Council Bills in March 1913 is not to be explained by the competition of gold as a means of remittance; for the low level of exchange did not favour the importation of sovereigns (even from Egypt, except earlier in the season), and as a matter of fact the import of them was on a very much smaller scale than in the previous year. Taken together, they make the whole difference between times of brisk trade and great prosperity, and times of stagnant trade and great adversity, so far as that prosperity and that adversity are real and not illusory. A General View of Lombard Street. Until now, or until lately, this difficulty has not been fully felt. The Bank cannot stay still and wait till its bills are paid, and so fill its coffers, for unless it discounts equivalent bills, the bills which it has already discounted will not be paid.

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