470 ANNUAL REGISTER, 1810. 



make individuals call in their ad- 

 vances, and provide against acci- 

 dents by hoarding ; and in a pe- 

 riod of commercial security and 

 private confidence, than when 

 mutual distrust discourages pecu- 

 niary arrangements for any dis- 

 tant time. But above all, the 

 i^ame amount of currency will be 

 more or less adequate, in propor- 

 tion to the skill which the great 

 money-dealers possess in manag- 

 ing and economizing the use of 

 the circulating medium. Your 

 committee are of opinion, that 

 the improvements which have 

 taken place of late years in this 

 country, and particularly in the 

 district of London, with regard 

 to the use and economy of money 

 among bankers, and in the mode 

 of adjusting commercial payments, 

 must have had a much greater 

 effect than has hitherto been as- 

 cribed to them, in rendering the 

 same sum adequate to a much 

 greater amount of trade and pay- 

 ments than formerly. Some of 

 those improvements will be found 

 detailed in the evidence: they 

 consist principally in the increased 

 use of bankers drafts in the com- 

 mon payments of London ; the 

 contrivance of bringing all such 

 drafts daily to a common recep- 

 tacle, where they are balanced 

 against each other ; the interme- 

 diate agency of bill-brokers ; and 

 several other changes in the prac- 

 tice of London bankers, are to 

 the same effect, of rendering it 

 unnecessary for them to keep so 

 large a deposit of money as for- 

 merly. Within the London dis- 

 trict, it would ce'tainly appear, 

 that a smaller sum of money is re- 

 quired than formerly, to perform 

 the same number of exchanges 

 and amount o( payments, if the 



rate of prices had remained the 

 same. It is material also to ob- 

 serve, that both the policy of the 

 Bank of England itself, and the 

 competition of the country bank 

 paper, have tended to compress 

 the paper of the Bank of England, 

 more and more, within London 

 and the adjacent district. All 

 these circumstances must have 

 co-operated to render a smaller 

 augmentation of Bank of England 

 paper necessary to supply the 

 demands of our increased trade 

 than might otherwise have beeii 

 required ; and shew how impossi- 

 bleit is, from the numerical amount 

 alone of that paper, to pronounce 

 whether it is excessive or not : a 

 more sure criterion must be re- 

 sorted to ; andsuchacriterionyour 

 committee have already shown is 

 only to be found in the slate of the 

 exchanges, and the price of gold 

 bullion. 



The particular circumstances of 

 the two years whiqh are so re- 

 markable in the recent history of 

 our circulation, 1793 and 1797, 

 throw great light upon the prin- 

 ciple which your committee have 

 last stated. 



In the year 1793 the distress 

 was occasioned bya failure of con- 

 fidence in the country circulation, 

 and a consequent pressure upon 

 that of London. The Bank of 

 England did not think it advisable 

 to enlarge their issues to meet this 

 increased demand, and their notes 

 previously issued, circulating less 

 freely in consequence of the alarm 

 that prevailed, proved insufficient 

 for the necessary payments. In this 

 crisis, parliament applied a remedy, 

 very similar, in its effect, to an en- 

 largement of the advances and is- 

 sues of the bank, a loan of exche- 

 quer bills was authorized to be 



