The Rise of the London Money Market, 1640–1826/145
ther in Gold or in a Bill at ten days on London, and five shillings per
cent, carriage, in the option of the Payers.” (Maberly Phillips, op.
cit.).
216. Mr. Burgess, in his “Circular to Bankers,” March 20, 1829: “Since
the panic of 1825, a meeting has taken place once a week or once a
fortnight at Northallerton (previously at Thirsk for a short time) at
which bankers from Stockton, Darlington, Richmond, Ripon,
Knaresborough, Thirsk, Boroughbridge, &c., attended. And this meet-
ing, we are informed, has been most useful, instructive, and agree-
able. It is a little centre of exchange for the bankers of that part of the
country, where demands upon each other are cleared as at the Clear-
ing House in London, but in a somewhat different manner, the trans-
action being so different” (Maberly Phillips, op. cit.).
217. Bankers’ Magazine, 1845, p. 219.
218. They circulated in amounts from £5 to £5,000, £8,000, and £10,000.
“The Banker has only to do with his customer: the customer applies
to his banker for such a bill as he wants, the banker keeps a regular
interest account with his customer, and the customer is debited only
with that bill on the day it falls due, so that he is not charged with
interest till the bill is due “ Lloydd’s evidence (House of Commons
Committee, 1819, iii., p. 169).
219. “It has been chiefly owing to the accommodation latterly afforded
by the Bank of England to the country banks, and the free supply of
its notes on easy terms, through its branches, for the provincial circu-
lation, that the use of bills in Lancashire as money has for some time
been progressively on the decline” (Fullarton, On the Regulation of
Currencies, 1844, p. 47. Cf. p. 49).
220. This period of three months corresponds with the average time for
which the Bank of England notes remain in circulation, viz., ninety
days.
221. Lloydd’s evidence before the House of Commons Committee:
“No doubt there is a great number of bills now [in 1819, March]
seeking discount which in a different state of things would have passed
as circulating medium without being offered for discount.”
222. The old theory was that they did return, but in exchange for coin
and bullion. The father of this theory, which is certainly not true
under present circumstances, was Adam Smith (Wealth of Nations,
ii., chap, ii., p. 239). Smith probably based his judgment on the con-
ditions which prevailed in the Scotch banking world. It is, however, a