dent is very justly at a
heavy discount; and Mr Goodenough's suggestion very practically gets
over a big difficulty that stands in the way of stopping the stream
of Bradburys. This difficulty lies in the fact that if the banks were
pulled at by their customers for currency and could not supply them
with Bradbury notes, they would be forced to take notes from the Bank
of England, with a bad effect on the appearance of its reserve. If
the business of issuing notes were put into the hands of the clearing
banks, their power to do so would be limited by the extent of their
assets, or of such of their assets as were thought fit to rank as
backing for their notes. In other words, the note-issuing business
would once more have to be regulated on banking principles and
controlled by the price asked, for advances, instead of expressing
the helplessness and improvidence of an impecunious and invertebrate
Government. In this manner the new departure might be a convenient
halfway-house on the way from chaos back to sanity. But probably it is
too revolutionary and goes too straight in the teeth of the Bank of
England's privilege to receive much practical consideration; and there
is the question whether the public would take the new paper readily
and whether it could be made legal tender.

Sir Edward Holden, in one of those masterly surveys of world finance
with which he now instructs the shareholders of the London Joint City
and Midland Bank, assembled at their annual meeting, gave much of his
attention to an attack on the report of Lord Cunliffe's Committee on
Currency. This was only to be expected, since the Committee had made
recommendations on lines which were largely conservative and did
not embody any of the reforms or changes which had been previously
advocated by Sir Edward. Being on this occasion chiefly critical, he
did not make very clear in his latest speech the precise proposals
that he favours. For them we have to go back to his speech of a year
ago, as reported in the _Economist_ of February 2, 1918, p. 171, where
he stated that "if the Bank (of England) had been working on the same
principles as other national banks of issue, there would have been
little ground for anxiety," and that these principles are:--

1. One bank of issue and not divided into departments.

2. Notes are created and issued on the security of bills of exchange
and on the cash balance, so that a relation is established between the
notes issued a