inental centers, the
Bank of England is able to induce these bankers to send money to
London for investment and thereby to increase her reserves, and by
lowering its rate below the level of the rates in these continental
centers, she is able to induce them to sell some of the paper they
already hold, and thus to furnish a market for her surplus funds and
diminish her reserves.

On account of the readiness with which the international gold movement
responds to variations in the discount rate of the Bank of England,
the need for an elastic system of bank note issues is not felt in
England to the same extent as in other countries. It is this fact,
doubtless, which explains the retention to the present day of the
essentially inelastic bank note system created by the act of 1844.

_3. The French System_

In France, the Bank of France is the central institution. It is the
oldest of the important French banks of the present day, having been
established in 1800 by Napoleon the First. Its capital, amounting at
the present time to 182,500,000 francs, or approximately $36,500,000,
is supplied by about 30,000 private stockholders, about 10,000 of
whom own only one share each.

The two hundred largest stockholders appoint a General Council,
consisting of fifteen regents and three censors. Five regents and all
the censors must be chosen from the commercial and industrial classes,
and three of the remaining ten regents must be selected from the
_tresoriers payeurs genereaux_, an important group of representatives
of the public treasury scattered throughout the country. The General
Council as well as the stockholders' assembly is presided over by a
governor, who, together with two sub-governors, is appointed by the
President of the Republic upon the nomination of the Minister of
Finance. The governor is the chief executive officer of the bank and
the final source of authority in most matters of vital importance. He
is responsible to the government rather than to the stockholders, and
is subject to removal only by the power which appointed him.

The Bank of France has about two hundred branches and sub-branches
located in Paris and all the important cities and towns in the
Republic, also over three hundred so-called agencies located in
smaller places and transacting only a limited line of business. Each
branch has a manager appointed in substantially the same manner as
the governor, and the sub-branches and agencies are administ