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164 joint stock banks of London do not keep one-third, or anything like one-third, of their liabilities in "cash"—even meaning by "cash" a deposit at the Bank of England. One-third of the deposits in joint stock banks, not to speak of the private banks, would be £30,000,000; and the private deposits of the Bank of England are £18,000,000. According to his own statement, there is a conspicuous contrast. The joint stock banks, and the private banks, no doubt, too, keep one sort of reserve, and the Bank of England a different kind of reserve altogether. Mr. Hankey says that the two ought to be managed on the same principle; but if so, he should have said whether he would assimilate the practice of the Bank of England to that of the other banks, or that of the other banks to the practice of the Bank of England.

Fourthly. Mr. Hankey should have observed that, as has been explained, in most panics, the principal use of a "banking reserve" is not to advance to bankers; the largest amount is almost always advanced to the mercantile public and to bill brokers. But the point is, that by our system all extra pressure is thrown upon the Bank of England. In the worst part of the crisis of 1866, £50,000 "fresh money" could not be borrowed even on the best security—even on Consols—except at the Bank of England. There was no other lender to new borrowers.