Currency fallacies refuted, and paper money ... - University Library

96 APPENDIX.Some of the persons whose names are mentioned in connexionwith this scheme we readily admit to be honourablemen, who are afflicted with a kind of monomania on the subjectof currency, and who resemble their associated speculators innothing else than in that distemper ; but we must warn themall equally of the danger and dishonesty of their undertaking.With the exception oj" 11. notes, we have at present as muchpaper ajloat as the wants of the country require,* or the creditof indivdiuals can command. ^ The smaller paper has beenwisely withdrawn from circulation, because it was foundthat pieces of gold and pieces of bank credit of the same denominationcould not circulate together, — that the paper, " havingwings to fly," always left the metal behind in the coffers orcellars of the banker, and that the facility of coining this speciesof paper money in any abundance had a tendency to depreciatethe whole of the circulating medium, after having separateditself from the gold, which was to be the only measureof its value. In demanding then, for the country banks,and for the Bank of England, the unlimited renewed power ofissuing \l. notes, the currency-club gentry mean to banishsovereigns from circulation, and to abolish the present metallicstandard. If they do not mean this, they mean absolutelynothing, because there is no legal restriction to the issue ofbank-notes at 51., or at any sum above that amount, on whichthey can hang any complaint. We are thus always insured ofa circulation of gold for smaller amounts, because it does notcome into competition with notes, and we thus always retainin our hands the means of testing the value of that paper bythe general standard of the rest of the world, and not by thefancy of the parties who modestly propose to usurp the King'sprerogative of the coinage.Let us take the whole amount of gold thus retained incirculation,— let us mark it at any sum which the cheap currencyspeculators may suggest, — let us call it 15,000,000Z. or20,000,000/., as they choose, — and let us then calculate the* Fallacy I, p. 3. f Fallacy 2, p. 5.