"sure on commerce in the spring and autumn of "1847? and his reply was to the following effect :

2680. "I consider that the causes which produced the pressure upon commerce in the spring of last year and in the autumn were the potato disease and the failure of other crops, the vast absorption of capital arising from the railways, and considerable overtrading in some branches of commerce."

"Mr. Norman added that he believed the value of "foreign corn imported amounted to 30,000,000l., for "which payment must necessarily be provided.

"Mr. Cotton, who, as well as Mr. Horsley Palmer, "had twice been elected Governor of the Bank, and "from the same motive, whilst he considers the dis"tress to have been 'greatly exaggerated' (8192.) and "nothing equal to what existed in 1825 and 1839,' "fewer banks and solvent houses having, in his judgment, suspended payment, adds,

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3194. " My impression is that there never was a time when so many parties had engaged in operations so much beyond what they ought to have done, with reference to their capital, as in the year 1847."

He speaks of the indiscreet trading with India, Mauritius, and in the corn trade, and observes, 'I think we might have expected many more solvent houses to have failed.' After the failure of one or two houses it appeared that credit had been stretched to a most unreasonable extent, larger than I ever recollect.'

"The great majority of witnesses do not concur in "Mr. Cotton's opinion, but unite in representing the intensity of the pressure as more severe than the "distress of 1837 and 1839; many even consider it "to have been greater than that of the year of panic, "1825.

Mr. Palmer 679-681: —

"Has the distress and pressure upon the public been greater or less during the last year, than in any preceding cases to which you have alluded?—I think it was greater during part of the year 1847 than ever I remember.

"With greater damage to commercial credit and fortunes than on any other occasion? I should say certainly.

"Do you apply that observation to the country generally or to London? I apply it to the whole country, especially to all the commercial parts of the country."

"Mr. Gurney's opinion on this subject is equally "distinct and decided,—

1238. "Are there in the history of the money transactions of this or of any other country, circumstances that can be at all compared to those that have taken place in this country in the last twenty months?

"I think that the catastrophes of last autumn were beyond all parallel in our monetary history, as far as I know."

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"Mr. G. Norman concludes that in 1837 and 1839, "the causes of pressure were much less extreme than "in the year 1847. In 1839 there was but little in"solvency of any kind. In 1837 there was, as well as "the witness recollected, no considerable insolvency "except in the American trade. In 1847, on the contrary, he stated (2702.) that 'every one seemed "afraid of his neighbour,' and in the opinion of Mr. "Tooke the time was approaching when nobody "would pay anybody.' Another witness, Mr. Lister, "states there was a panic through the country; people thought they were in an iron cage, and could "not get out of it; that iron cage was the Act of 1844.''

"On the other hand, it is right to observe, that some "witnesses represent the pressure in 1847 to have "been less severe than at several former periods. "The Governor and Deputy-Governor of the Bank, "in the following questions, state their impressions "to this effect, and as regards the comparative consequences of the commercial distress in different years."

95. "You said that you thought that the Act of 1844 had worked extremely well to secure the convertibility of the notes; do you apprehend that there would have been any danger of the notes of the Bank of England not being convertible if it had not passed?—I think they would have been in danger. On one or two previous occasions, I think, they were in danger-in 1825 and in 1839."

96. "And you think that they would have been in danger now, but for this Act?-They might have been."

T

Mr. Prescott:

"I agree with the Governor. I think that the pressure was not so great in 1839 as it was in 1847, and therefore that the danger in 1847 would have been greater, but for this Act."

97. "Was not the pressure greater this year than you have ever witnessed?- My own experience scarcely carries me back to 1825, but I should conceive that the pressure in one or two weeks in 1825 was greater than in 1847."

Mr. Morris:

"I believe that the pressure probably has been greater in London and in Lancashire, and probably in other places, but I doubt whether the pressure generally throughout the country has been so great as it was at the former periods."

98. "Do you consider that circumstance at all attributable to the action of the Act of 1844 upon the private bankers in the country? - I consider that the action of the Act of 1844 upon the private bankers of the country must have been of the greatest possible benefit."

"And to have preserved the country from the failures of country banks which took place in 1825?-To have preserved the country from the misfortunes fallen into in 1825."

104. Assuming that the pressure in 1847 has been more severe upon the commercial world in London than upon previous occasions within your knowledge, should you say, considering the distance at which we have now arrived from the period of pressure itself, that the recovery from it has been more rapid, and that there has been less subsequent pressure, than upon former occasions? I think the recovery from it has been much more rapid, but it is difficult to say when the recovery has taken place."

105. "Without assuming at the present moment that we have actually recovered from it, but looking at the course of affairs since October, should you say that there has been less severe distress consequent upon the panic, than there has been upon previous occasions? I think that the reaction has taken place sooner than it otherwise would have done."

109. "The question is, not as to what would have happened if the Act of 1844 had not passed, but merely as to the matter of fact, whether the distress and the sacrifice of capital, and the general damage, both to the commercial character as well as the credit of the country, has not exceeded in the last year anything that in your experience you ever witnessed?—I think in the failure of large houses it has exceeded, but whether it has as far as the whole country is concerned, I am not prepared to say. My impression is, that the damage to the country from the panic of 1825 was greater and more general then than any which has taken place in 1847."

"I think as many as sixty or seventy country banks failed in the end of 1825, and now there has not been a dozen."

In justice to the country bankers I may observe that, "Sir M. W. Ridley said in the House of Commons, 3rd June, 1828, that:

"In 1825 and 1826 there were 770 country bankers, and of these sixty-three had stopped payment. But of the sixty-three twenty-three had subsequently resumed their payments, and paid 20s. in the pound; and of the remainder, thirty-one were making arrangements for the payment of their debts, and there was a great hope that every farthing would be paid. The country bankers who had failed in 1826, had paid, on an average, 17s. 6d. in the pound."

"Mr. Jones Loyd will be found in his evidence, as follows, to express his opinion more strongly as "to the greater intensity of the pressure on several "former occasions than in 1847:

1426. "Within your experience do you know any time in which there was a greater disturbance of credit, so as to necessitate an increase of the reserves, than there was in that month of October, 1847?—I believe that the disturbance of credit was greater and more widely spread in 1825 than it was in 1847."

1496. "Do you suppose that any evil can occur to a great commercial city greater than that which happened during the year 1847 in the city of London, or that there ever were instances in which so complete a sacrifice of property, and so complete an impoverishment of commercial capital, has taken place in any country?—I have no doubt that there existed much greater pressure, and that the evils alluded to in the question occurred in a severer form in this country in 1783, in 1793, and in 1825. We are always apt to form an exaggerated estimate of the present evil. This is the account given by Mr. Tooke of what took place in 1783: This contraction of the currency was attended with a great rise in the rate of interest. Consols fell from sixty-eight to fifty-four, omnium from a premium of 8 per cent. to below par. Every one, says Chalmers, must remember how impossible it was to borrow money on any security for any premium.' Then again take 1793: Many houses of the most established credit failed. Houses of undoubted solidity, possessing ample funds, which actually did in a short time enable them to pay every shilling of their debts,

* Tooke on Prices, v. ii. p. 161.

were obliged to stop payment. Some bankers who almost immediately on recovering from the first panic, resumed the regularity of their payments were obliged to make a pause. Many whom the temporary assistance of even a moderate sum would have enabled to surmount their difficulties could not obtain any accommodation. Those who had any money, not knowing where they could place it with safety, kept it unemployed and locked up in their coffers.' Such is the account given in Macpherson's Annals of Commerce of the pressure in 1793. It would be a most incorrect and exaggerated account of the state of things in 1847. Then again as regards 1825. We have Lord Ashburton's account of 1825, as given in Sir Robert Peel's speech, which, taken as a description of 1847, would be a great exaggeration."

The Committee observe:

"Such is the description of the commercial world in 1847, "given by well-informed witnesses; and the Committee consider "that a more alarming picture of the consequences of panic and "discredit could not well be given. It must also be recollected that "in some respects the conjuncture was favourable. Had there been "at this time any domestic political alarm, had there been any "foreign war, or any speculations in foreign loans, or had the state "of the balances in the Exchequer been such as to render necessary "large advances from the Bank on deficiency bills, the extent and "intensity of suffering, great as they actually were, would have "been rendered still more formidable. But from these sources of "danger the country was happily exempted. Still it is clear to your Committee that the difficulties and dangers of the case were "such as to require a remedy, prompt, decisive, and effectual.”

It may be useful to trace what difference existed in the circumstances, attending the different money crises, of 1793, 1825, 1837, and 1839, and if they resemble the crisis of 1847; I subjoin the following extracts from Mr. Tooke's "History of Prices," vol. i. p. 176:

"The commencement of 1793 is among the most memorable in the annals of this country, and of Europe, and indeed of the civilised world. It was in February of that year that the war with France, which, with the intermission of a few months, lasted for upwards of twenty years, was declared."

"There had been immediately preceding that event a great revulsion and derangement of commercial credit, not only in this country, but in the principal trading cities of the continent of Europe.".

"Sir Francis Baring, in a pamphlet published in 1797, observed, "A circumstance which very materially contributed to produce the distress of 1793, was the sudden, unexpected declaration of