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 or advances, it increases the deposits that it holds, either "Public" or "Other," either on account of the British Government or of some other customer. Since the Public deposits, the balances held by the public departments, are in normal times a more or less constant quantity, the usual effect of any advances that may be made by the Bank of England, either to the Government or to anybody else, is to increase the total of the "Other" deposits; since what the Government borrows it pays out to individuals or companies to whom it owes money and they pay it into their own banks.

It may happen occasionally that those who are given an advance by the Bank of England may use it in order to withdraw cash, just as a borrower, who borrows from an ordinary bank in order to pay wages to his workmen, may take out coin for that purpose. In either case, however, it is most likely that the coin or notes so taken out will come back in the ordinary course of trade to be deposited with one bank or other in the case of ordinary banks; or with the Bank of England itself in the case of advances made by the Bank of England; but in the latter case there is the exception that demands made upon it for cash may—or might in pre-war days—take the form ultimately of