use in
England, cannot be accounted for on the score of discounting.

Secondly, as a bank of deposit. To deposit money at the bank means to
lodge it there for the sake of convenience, and to be drawn out at any
moment the depositor pleases, or to be paid away to his order. When
the business of discounting is great, that of depositing is necessarily
small. No man deposits and applies for discounts at the same time;
for it would be like paying interest for lending money, instead of for
borrowing it. The deposits that are now made at the bank are almost
entirely in bank notes, and consequently they add nothing to the ability
of the bank to pay off the bank notes that may be presented for payment;
and besides this, the deposits are no more the property of the bank than
the cash or bank notes in a merchant's counting-house are the property
of his book-keeper. No great increase therefore of bank notes, beyond
what the discounting business admits, can be accounted for on the score
of deposits.

Thirdly, the bank acts as banker for the government. This is the
connection that threatens to ruin every public bank. It is through this
connection that the credit of a bank is forced far beyond what it ought
to be, and still further beyond its ability to pay. It is through this
connection, that such an immense redundant quantity of bank notes, have
gotten into circulation; and which, instead of being issued because
there was property in the bank, have been issued because there was none.

When the treasury is empty, which happens in almost every year of every
war, its coffers at the bank are empty also. It is in this condition of
emptiness that the minister has recourse to emissions of what are called
exchequer and navy bills, which continually generates a new increase of
bank notes, and which are sported upon the public, without there being
property in the bank to pay them. These exchequer and navy bills (being,
as I have said, emitted because the treasury and its coffers at the bank
are empty, and cannot pay the demands that come in) are no other than
an acknowledgment that the bearer is entitled to receive so much money.
They may be compared to the settlement of an account, in which the
debtor acknowledges the balance he owes, and for which he gives a note
of hand; or to a note of hand given to raise money upon it.

Sometimes the bank discounts those bills as it would discount merchants'
bills of exchange; sometimes it purchases t