NEWS OF THE WEEK.
THE second great monetary measure of Sir ROBERT PEEL's life, the complement to the bill of 1819, was promulgated on Monday. We had some difficulty in believing the anticipations of others early in the session, that he would suffer this opportunity to pass without that revision of the Bank charter which must otherwise have been postponed for ten more years ; and while gossips were speculating nn his inaction, the Minister must have been maturing his pre- determined plan. It was kept so close, however, that even to the last but a very faint notion of it got abroad ; and the want of fore- knowledge as to his intention imparted to his speech, as he de- veloped his plan, even in so dry a matter as a currency measure, a kind of dramatic interest. The interest lost nothing by his manner of treatment ; which was in his happiest style. The few great compartments of his subject were broadly and distinctly marked out ; the details, rapidly but lucidly touched, fell into their proper places; so that, while every part was as clear as glass, the relations of the whole were easily kept in view ; and the animated choice of expression, with the strictly practical bearing of the whole, gave to so abstract a subject the character of action. You felt that the speaker was arranging not mere banking-accounts but national deeds and events. Be began by laying down prin- ciples. First, he defined the common denomination of value, a "pound"; which means nothing else but a certain quantity and quality of the precious metals—a known thing which is adopted as a measure of the value of other things, and not some abstract standard of positive value. Discussing this point, he achieved an easy victory over the " Birmingham " Currency-men, his old controversial antagonists. He was very successful in drawing a distinction be- tween those instruments of transfer from specified individuals to individuals, bills of exchange or such other species of paper credit, and promissory bank-notes payable to any bearer on demand, which are real substitutes for money : the distinction is, that bills of ex- change represent debt, bank-notes represent coin. His business was to show that the two kinds of paper exercise different influences on the state of the currency ; and that measures affecting one kind need not affect the other, as some had pre- tended. He proved from the evidence of Country-bankers, that the portion of the paper-circulation which consists of Country- bank-notes is not regulated by considerations of what is best for the public, but is dilated or contracted according to the oppor- tunities offered to the banks of " custom " in their trade : in time of speculation, therefore, impulse is given to overtrading by the ex- traordinary facilities of obtaining this kind of money ; and the con- sequence is, that the gross amount of money in the country is ever indefinite and irregular in amount, and uncertain in value,—cer- taiiny and regularity being the two essential qualities of a proper currency. It has been observed that at this part of his speech there was an hiatus, and that Sir ROBERT PEEL passed from his principles to his practical measures without explaining their necessary con- nexion. We believe that this characteristic will be found in all his notable speeches, and that it is a trait of his own mind. He is not an original reasoner, nor a bold inventer. With great perceptive powers, he masters the reasonings of others, and with great practical experience and nous he contrives a way to give effect to his adopted principles; but, lacking the original logical faculty, he cannot so well explain how the measures grow out of the principhs. He leaves that for commentators ; who may write for years about what he will do in a session, after he has once
made up his mind. You may find the same sort of hiatus in his Tariff-speech, and many others. His measures
are not the inevitable conclusions of his premises—often the inevi- table conclusion is something larger ; but, allowing for his good Journeyman-maxim of working with the instruments ready to his band, you will generally find the measures pat enough as far as they go.. In the present case they go a long way. He takes the existing metallic currency as being all that it is wanted to be; and his grand object is to place the paper currency in as definite and distinct a position as if it issued from the Mint and bore its weight of gold stamped upon it. To that end he remodels the Rink of England. It is to be divided into two departments ; one to be a bank of issue, and nothing else. Its issues will be made upon two bases, securities and bullion. The securities are to be defined,— a debt of 11,000,000/. from Government to the Bank, a kind of Government stock to serve as guarantee for that amount of notes; and 3,000,000/. of Exchequer Bills and other public securities, not so permanently fixed; together, 14,000,000/. The other department of the Bank will be an ordinary bank—the great batik of the country ; managing the Public Debt, and serving private customers. Bullion deposited in this bank will be transferred to the issue-department in exchange for notes. The issue-bank will have the power within 45its own hands of contracting its circulation to the extent of the 3,000,000/. variable public securities; it will be allowed to extend its circulation on emergency, with the consent of' three Ministers— probably the First Lord of the Treasury, the Chancellor of the Exchequer, and the Master of the Mint. In the dilation or contrac- tion of the currency based upon bullion-deposits, the Batik must follow the action of the public. Great security and confidence will be produced by the weekly publication of full accounts. An analogous process is ingeniously applied to the multifarious brood of Country Banks. The banks of issue are to be restricted to their present number—there are to be no more new batiks of issue ; the notes are to be restricted to their present amount—no batik is to issue more notes than it now does on an average of years; and the amount of such circulation is to be publicly recorded. The maxi- mum amount of the Country paper-currency is therefore to be fixed henceforth. Should any sudden deficiency occur. in it, as by the cessation or failure of a bank, the Bank of 'England will apply its power of extending its own circulation; the profits of such extension to go to the public exchequer. Along with these new restrictions go some facilities and improvements for ordinary banking : Joint Stock banks are to have the privilege of,sueing and being sued ; they are to be bound by the acts of authorized partners, but not of unauthorized partners; in the Metropolitan circle they are to issue bills of short date ; they are to pablisit lists of their partners and directors; in the case of new establish- ments, they must obtain the assent of Government, and register prospectuses and other papers. Regarding the measure as a whole, the business of banking is placed on a more certain footing ; and the business of issuing paper-money is made distinct, with pro- vision for its gradual absorption by a central body,—a committee of the Bank of England virtually contracting to do the work of a Government department in performing the function of a paper- money mint. The total amount of money, metallic and paper, will thus be an ascertained and centrally-regulated quantity ; and the " standard of value" will possess as much steadiness as possible. This great scheme has been received with varying impressions. Some object that it will "make money dear," and deplore that the Minister does not alter the standard of value, as it has often been altered—by swindling sovereigns—since the days of WILLIAM the Conqueror : as if, sa3s Sir ROBERT PEEL, we gain any thing in the thing measured by altering the nominal number of inches in a foot! It is remarked more justly, that in our complicated system the disturbing influences are too many to permit the result to be seen at once. But it is anticipated that the great change will be effected with singularly little detriment to private interests; and on the whole, except among " thf.i Currency-people," the scheme is re- garded as a very statesmanlike measure.
