lutions consequent upon this letter, which
were of great importance to the trading community. These resolutions
were conveyed to the government by a letter from the governor and
deputy governor of the Bank:--

_Bank Resolutions_.

"Resolved,--That this Court do accede to the recommendation contained in
the letter from the First Lord of the Treasury and the Chancellor of
the Exchequer, dated this day, and addressed to the Governor and
Deputy Governor of the Bank of England, which has been read;

"That the minimum rate of discount on bills not having more than 95 days
to run be 8 per cent;

"That advances be made on Bills of Exchange, Stock, Exchequer Bills,
and other approved securities, in sums of not less than L2000, and for
periods to be fixed by the Governors, at the rate of 8 per cent, per
annum."

The immediate effects of this measure can be most briefly shown by the
following reference made a few days afterwards by an authority in such
matters:--"As soon as the correspondence between the Bank of England
and the Government was made public, a rise of nearly two and a half per
cent, immediately ensued. Consols on Saturday left off at 80 3/4 to 7/8,
and on Monday 83 1/2 5/8. Several fluctuations, however, occurred in the
course of the day; and a fall of one per cent, on the announcement by
the Bank broker of the truth of the correspondence alluded to above,
excited much surprise. On Tuesday, the market was very unsettled,
operations being nearly confined to Consols. The opening quotation was
83 5/8, and the highest quotation 84 3/8, with numerous fluctuations.
A tendency to reaction was visible on Wednesday; the first price was 83
1/4 for money, which declined to 82 3/8, but afterwards rallied to 82
1/2-3/4, at which price they closed. On Thursday, there was scarcely any
fluctuation until towards the close of business. The news of a banking
failure in the West of England caused a fall of nearly 1/2 per cent.;
and, at closing, 82 1/4 for Money, to 82 3/8 to 1/2 for Time, were the
current quotations. Exchequer Bills have considerably fluctuated during
the week; about 20s. dis. for large bills is the closing quotation. Bank
Stock has rather improved, but India Bonds continue very much depressed,
quoting about 30s. dis."

The prevailing feeling among political economists was unfavourable
to the measure; and there were many effects attending upon it which
vindicated their judgment. In the provinces banks gave way, a