40 
Proceedings of the Royal Society 
of which might relieve it of the first mentioned service, in which 
it suffers much waste, and set it free for the two others. 
The plan proposed was to disqualify gold, under legal penalties, 
for currency or barter within the island, upon which it would flow 
into the Bank, to be kept there for the security of the notes which 
would take its place, and for the arts and foreign trade. The gold 
currency being shown to amount to 80 millions, it was next 
explained that, agreeably to an article in the “Economist” of 3d 
July last, the saving thereby effected (in tear and wear, coining 
and recoining) to the country would be fully L. 56, 000 a year, or 
rather L. 60, 000 a year, as L.4000 might be added for loss by fire 
and shipwreck. As to the expense, again, of the paper which 
would be needed to represent the 80 millions of gold brought in by 
the disqualification, the author proposed to provide for it in the 
following way : — Let the Bank have to itself two of the 80 millions 
of gold, and yet be allowed to issue paper to the full amount of 80. 
The uncovered part of the issue would be a slight extension of the 
14 or 15 millions already privileged by statute, and such an ex- 
tension has been often proposed, and by able men. In return for 
the two millions of gold, the Bank might very fairly be expected to 
provide the paper currency and pay the State L. 25, 700 a year. 
These figures are arrived at by the terms of the arrangement 
between the Bank and Government as to the 14 millions being 
adopted for the two millions now. Farther, a return to the use of 
small notes in England was recommended, as the experience of 
Scotland showed that certain improvements in engraving were 
complete preventives against forgery ; and he advocated also gold 
bars, a suggestion of the late Mr Ricardo, instead of coins. 
The result of gain on the whole would be, to the State L. 60, 000 
and L. 25, 700, besides L. 18, 000 of profit to the Bank after defraying 
the paper currency — or, in all, L. 103, 700 a year, which, capitalised, 
would be three millions. 
Such was Mr Coventry’s proposal. But he added that some 
might reasonably be inclined to go further, and to take the whole 
or part of the remaining eight of the 78 millions, making some 
compensation to the Bank, of course, seeing that a reserve of 78 of 
gold against 80 of paper, large at any time, would be extravagant 
when gold fell to be disused for currency. Even if we were to 
