8 September 1866. N. 1202.

The Economist, 8. September 1866. S. 1049/1050.
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The Circulation of Banknotes in England since the Panic.

Overends failed on Friday Evening  Fehlerhafter Zusatz von Marx. Gemeint ist Freitag, der 11. Mai 1866. Laut Angaben der „Money Market Review“ stellte Overend, Gurney and Company allerdings bereits am Donnerstag, den 10. Mai 1866 die Zahlung ein (siehe S. 187 des vorliegenden Hefts).
(9 May)
, and by the next Friday the active circulation had increased by, 3,776,000l. , und zwar, wie Return by order of H.o.C. zeigt, folgendes der change in der increase der notes of different denomination:

Denomination of Note. May 9. May 16. Total Increase Percentage of Increase
£ £ £. £.
£5 8,063,000 8,711,000 648,000 8
10 4,299,000 4,876,000 577,000 13
£20 to £100 6,482,000 8,185,000 1,703,000 26
£.200 to £500 1,798,000 2,337,000 539,000 30
£.1000 1,703,000 2,012,000 309,000 18
Notes held by the public 22,345,000 26,121,000 3,776,000 17

Daher evident, daß by far the highest percentage increase in the notes above 20£ und daß 2,500,000l., or in round numbers, 2/3 of the whole sum, were in notes as above 20l. also. The This shows the purpose for which the great demand on the B.o.E. was made – for deposits. The demand for notes above 20l. could not be to supply the place of the country circulation, which consists wholly of 5l. and 10l. notes.

The country circulation did not instantaneously fall, but it very rapidly did so. It fell at the worst period 909,000l., while the B.o.E. 5l. and 10l. note circulation increased at the worst time, 1,225,000l. The main strain of the demand on the Bank was for a reservethe deposits of other bankers – for notes of a high denomination suitable for that purpose, and for it only.

The return also shows that before the Panic and since February there had been an increase of the banknote circulation, of 1,782,000l., nämlich:

Denomination of Note Febr. 29 May 9. Total Increase. Percentage of Increase.
£5 7,389,000£ 8,063,000£. 674,000£ 9
10 4,005,000 4,299,000 294,000 7
20 to 100 5,916,000 6,482,000 566,000 9
200 to 500 1,590,000 1,798,000 208,000 13
1000 1,663,000 1,703,000 40,000 2
Notes sold by the Public 20,563,000 22,345,000 1,782,000 8

Similar change in 1864. Febr. 24, 1864 active circulation was £19,857,000 und 9 May 1866: £21,484,000.|


The Economist, 8. September 1866. S. 1052.
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The Meeting of the London, Chatham, and Dover Railway Co.

There was a most startling revelation of the mode in which railway debentures are issued. As soon as the power of issuing debentures is obtained, large numbers are at once issued en masse, and a loan raised upon them. As the public, i.e. as real investors, ask for debentures, new ones are granted. But when the limit of the borrowing powers is reached, this process becomes very dangerous. The public money comes in in exchange for new debentures, and with this money the existing loans are paid off, and the old debentures redeemed. But almost necessarily the new debentures are issued before the old ones are got in. There is a moment when both the new and the old are running together. And sometimes the money received in exchange for the new debentures is not used in paying off the old debentures. This happened in the case of the London, Chatham and Dover: the Co. was in great difficulties, their financial agents, Peto et Co , were under immense obligations, and the money was used for other purposes. Hence 128,000 debentures have been issued in excess of the borrowing powers, and these the public, the real investors, hold. The first and good debentures were only advanced upon by bankers and others.

Mr. Rankin, a railway solicitor of the greatest experience, says this is the general practice of railways companies. Who can be sure, then, that his debenture a legitimate one, and not, a fraud? The credit of railway debentures as a security will not survive a series of instances like the present.

The second minor point  Kommentar von Marx.
⦗dieser ist aber sehr wichtig in den U. States.⦘
: It seems these metropolitan cos. turn their compulsory power for taking land into a happy machinery for land speculation. People must sell to them; the value of land near great cities is always rising, and so the Co. eke out their own deficiency of capital. Lord Sondes, the chairman of the Lond., Chat. and Dov., said: „Their solicitor, Mr. Newman, had obtained for the Co. as much land as possible in the city; any portion of it would could now be sold at a profit of at least 20%.“ Also die Co have got a large profit by buying as much land as possible whether they wanted it or not. In future Parliament must be more rigid in confining the area of the land powers it grants, and probably a future juries will compel railway cos. to pay a price for their land higher even than at present.

The Economist, 8. September 1866. S. 1058–1060.
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Money Market.

On 6 Sept. Bankrate of Discount reduced to 5%. Increase of bullion in B.o.E. of £363,192, und Reserve 40,457. Decrease in Private Securities £.711,697.

Failures: Suspension of R. Morrison et Co, of the Engine works, Ouseburn, Newcastle.

19 January, 1867. N. 1221.

The Economist, 19. Januar 1867. S. 58.
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The Danger of mixing up Acceptances and Deposits in the Banking Accounts.

Suppose the liabilities of a Bank, viz. deposits and acceptances together, have, at 31st Dec. 1866, fallen off, say 3,000,000l., as compared with June, 1866. The Bank may have shortened sail, and reduced its acceptances, or lost public confidence, so that public has reduced its deposits. While the accounts are put together no human being can tell which. The chairman of one bank has defended the combination of these distinct liabilities, upon the ground that it was not desirable, that the source of the bank’s profit should be revealed.

The Economist, 19. Januar 1867. S. 60–62.
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Letters of Creed and Williams on the danger of foreign competition in the iron trade and the subsidiary branches of industry.

The Economist, 19. Januar 1867. S. 62/63.
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Government Notes“ by R. Slater.  Zusatz von Marx.
(Mintnotes) (Bullion notes)

Hat gezeigt, in a pamphlet, December 1857, from actual commercial transactions reduced to the scale of one million, that gold entered only to about 3% of the whole, banknotes 8%, bills of exchanged exchange to 53%, cheques to 36% of the actual circulation. Let the Mint, or some public body, be the recipient of standard gold, and issue its certificates for its value at 3l. 17s. 101/2d. per oz. These certificates, or notes against bullion, will circulate over the whole of Europe, without the necessity of exporting bullion. But above all, that bullion will belong to the people in whom the capital of the country is really invested, will be distributed amongst them, and not be concentrated in the hands of the Bank.


  • London. 1868.
  • 1866 „The Economist“ (Jahrgang 1866) vol. XXIV.
  • The Social Economist, 1. Oktober 1868
  • „The Economist“ (Jahrgang 1866) (Fortsetzung)
  • Jahrgang 1867.
  • Register der obigen Auszüge aus dem Economist für 1866 und 1867.
  • The „Money Market Review“. Jahrgang 1866.
  • The Money Market Review. Jahrgang 1867.
  • Register Money Market Review Jahrgänge 1866 und 1867