f necessary, it might be
adjourned till the first week in February.[54]

Viscount Palmerston submits an explanatory Memorandum which he has
just received for your Majesty's information from the Chancellor of
the Exchequer....

[Footnote 53: The financial crisis had originated in numerous
stoppages of banks in the United States, where premature
schemes of railway extension had involved countless investors
in ruin; in consequence, the pressure on firms and financial
houses became even more acute than in 1847; see _ante_, vol.
ii., 14th October, 1847. The bank rate now rose to 10 per cent.
as against 9 per cent. in that year, and the bank reserve of
bullion was alarmingly depleted.]

[Footnote 54: Parliament accordingly met on the 3rd of
December, and the Session was opened by the Queen in person.
The Act of Indemnity was passed without serious opposition,
and a select committee re-appointed to enquire into the
operation of the Bank Charter Act.]

[Pageheading: ARMY ESTABLISHMENT]

_Queen Victoria to Lord Panmure._

OSBORNE, _18th December 1857_.

The Queen has had some correspondence with Lord Panmure upon the
Establishment of the Army for the next financial year.[55] She wishes
now to lay down the principle which she thinks ought to guide our
decision, and asks Lord Palmerston to consider it with his colleagues
in Cabinet. Last year we reduced our Army suddenly to a low peace
establishment to meet the demand for reduction of taxation raised in
the House of Commons. With this peace establishment we had to meet the
extraordinary demands of India, we have sent almost every available
regiment, battalion, and battery, and are forced to contemplate the
certainty of a large increase of our force in India as a permanent
necessity. What the Queen requires is, that a well-considered and
digested estimate should be made of the additional regiments, etc.,
etc., so required, and that after deducting this number from our
establishment of 1857-1858, that for the next year should be brought
up again to the same condition as if the Indian demand, which is
foreign to our ordinary consideration, had not arisen. If this be done
it will still leave us militarily weaker than we were at the beginning
of the year, for the larger English Army maintained in India will
require proportionally more reliefs and larger depots.

As the Indian finances pay for the troops employed in