The reserve being very small, it endeavoured to protect that reserve by lending as little as
Money is economical power. by regulation, does not affect the level of prices differently from the way in which it would be affected by a system in which the rupee was a gold coin worth 1s. The magnitude of our commerce, and the number and magnitude of the banks which depend on the Bank of England, are undeniable. ' In order to induce the subscribers to advance the money promptly on terms so unfavourable to the public, the subscribers were to be incorporated by the name of the Governor and Company of the Bank of England. Till 1857 there was an unusual calm in the money market, but in the autumn of that year the Bank directors let the banking reserve, which even in October was far too small, fall thus: Oct. .
In 1906 three Banks were founded, all of some importance,—the Bank of India (under important Parsee auspices), the Bank of Rangoon, and the Indian Specie Bank.
Probably, if he be a cautious man of average ability, he will combine both evils; he will not lend so much money as he is asked for, and so will offend his own supporters; but will lend some which will be lost, and so the profits of the Bank will be reduced.
So that our one-reserve system of banking combines two evils: first, it makes the demand of
But now large joint stock banks of deposit are among the most conspicuous banks in lombard