THE COMMUNAL CURRENCY OF GUERNSEY
' [To the Editor of the SPECTATOR.]
Sin, —I should like to draw attention to the remarkable financial policy of the State 'of Guernsey between the years 1816 to 1837. A full account is given in An Example of aim- munal Currency, by J. T. Harris (P. S. King and Son). During that time the State created £81,000 of money on the security of Spirit duties. £25,000 of this was redeemed and the notes destroyed. For instance they built a Market Hall with an issue of £1 notes, and redeemed them with the shop rents. In 1816 the Island was in a desperate state and by 1837 it was flourishing. In 1827 and 1830 the first two banks opened. By 1837 the influence of the banks brought this financial policy to an end. The State accepted a loan of £15,000 at 3% from the banks in place of interest free notes, and the balance- of £41,318 in notes are an interest free debt, to this day—a debt to themselves. This experiment is worth further investigation, as if Guernsey could safely do this 100 years ago, Britain could create many thousands as much to-day.—I am, Sir,
88 Bromar Road, S.E. 5.
E. WRIGHT.
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