536 JOINT-STOCK BANKING SYSTEM. 



Thomson, nearly two hundred millions, or twenty times the capital 

 of the Bank of England, an insanity which has had the baneful 

 effect of creating a great rise in prices generally, such a rise, 

 indeed, as we are not at all able at present to sustain. Others are 

 disposed to blame the facility with which some of our commercial 

 men have allowed the market to be glutted with American produce 

 and so permitted very large exports of gold to the United States ; 

 and the same party look with jealousy to the financial aid that has 

 been furnished to suffering Ireland, just as if our own interests were 

 not inseparably linked, and as if such assistance were a matter of 

 charity and favour rather than of imperious necessity. A fourth 

 division of the complaining parties having more contracted views or 

 considering the pressure only as temporary, lay much stress on the 

 failure of the crops in the north of England and on the consequent rise 

 of corn-prices which will have the effect of opening the ports and 

 of sending a large quantity of gold out of the country. A fifth party 

 are willing to throw a large part of this unpleasant responsibility on 

 the Joint-Stock Banking Companies in different parts of the country* 

 and to attribute the evils that we now suffer to the imperfect financial 

 arrangements made to restore public confidence after the frightful 

 panic of 1825-6. Whether to these or any other causes separately 

 taken, or to a combination of any number, or of the whole, we are to 

 attribute the embarrassments now very generally complained of, we 

 know not, nor is it our present intention to enquire. We turn with 

 more confidence to a subject nearly connected with these financial 

 troubles ; and if any remark that may here be made shall contribute 

 to the establishment of just views, the trouble that has been taken in 

 drawing up these observations will not have been thrown away. 



The Joint-Stock Banking System was the immediate result of the 

 panic of 1825, produced by the over-trading and bubble-schemes of 

 the previous year, and was contemporaneous with the suppression of 

 country-bank notes of lower value than 51. During this revulsion 

 (one not less severely felt than that of 1792) and within a period of 

 four months no less than Jiffy-nine commissions of bankruptcy were 

 issued against country banks ; and many others were in embarrass- 

 ments which, though not plunging them in public disgrace, were not 

 less inconvenient to those whose money was invested in them. A 

 notion hence became prevalent that no sufficient security could be 

 found in banking-establishments, the number of whose partners was 



