Has there been any increase in the price of labour?-Yes,

Has that been considerable ?-As coals are an article of prime necessity in the London market, the price of labour immediately rose upon the price of the necessaries of life being augmented.

Did the price of labour rise generally as well as in the collieries?-Certainly.

Can you form a judgment in what proportion ?-I cannot accurately state it. Was there not a considerable demand for Cash on your Bank, and the other Newcastle Banks, about the end of the last or beginning of the present year?-In addition to, the collieries and manufactories, which the Banks are in the habit of supplying with Cash for their payments, a considerable demand arose from the number of troops stationed in that part of the island; the Banks have therefore, during that period, had more deinand for Cash than in the usual course of trade.

Did the demand for Cash increase in the beginning of the present year, so as to induce the Banks at Newcastle to stop payments in Cash?-The Banks at Newcastle stopt their issue of Cash by agreement on Monday the 20th of February. The preceding Saturday being the market day, the farmers, who at this period of the year have the principal part of their rents in their hands, actuated by the apprehension of an immediate invasion, hurried into Newcastle the produce of their farms, which they sold at very low prices, and immediately resorted to the different Banks to convert all the Notes which they had collected into Specie. This alarm not subsiding on the Monday; and the Banks conceiving it their duty to retain a sufficient proportion of Cash to continue their issues to the army, collieries, and manufactories, took the steps above-mentioned. Previous to this period they had felt a considerable drain, though the applications from the country for Cash had not been attended with apparent alarm. At this period, when the alarm took place, our Notes had been gradually reduced about one half, and are now still further reduced.

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Were similar demands made upon the other Banks at Newcastle ?-I presume so; for they all stopt by agreement.

Do you imagine that the amount of Notes of the other Banks at Newcastle in circulation, has been diminished in the same proportion, or nearly so?-That they have been considerably diminished I have no doubt, but the extent to which they have been reduced is unknown to me.

What do you apprehend to have been the cause of the diminution, previous to the run upon the Banks on Saturday the 18th of February? The necessity of a contraction in the trade of almost every description of persons. The coal trade had previously been in an unfavourable situation; and much Money was locked up in corn, which had been imported to a great extent.

Do you apprehend there were any other causes for a contraction of adventures in trade? -People could not so easily obtain Money on discount, as when Trade was more pros

perous.

Are the Newcastle Banks in the habit of having Specie occasionally sent down from London ?-Yes.

Were any large sums of Specie sent to you, or to the other Banks at Newcastle, from London, during the two or three weeks previous to the 26th of February last?-No large sums of Money had been sent, but a moderate supply had been procured, probably from 20 to 30,000l. amongst us; and we were in the act then of procuring very considerable sums, if the Bank had continued open.

Do you imagine the sums actually procured, to have been greater than they usually were during the same course of time-Certainly; I apprehend that all the Banks together do not ordinarily draw above 1,000l. in Cash a week, if so much; in general the circulation of the country is sufficient of itself.

Do you imagine the sums received from London, to have been greater than they were in the year 1793, in the same proportion of time, in consequence of the run?-They bear no proportion; the sums sent down in 1793 were much larger.

Was that circumstance owing to the inability to procure Cash in London, or was it owing to there not being so great a want of it in the country as in the year 1793?-It was owing to the impossibility of procuring Cash from the Bank of England after the 26th of February..

Have you any reason, from information or otherwise, to know whether the apprehension, which more immediately occasioned the drain on the Country Banks, still continues to exist in the counties of Northumberland and Durham ?-I apprehend that the alarm has not altogether subsided, and that the country people are still desirous of procuring Specie; but from the manner in which the leading interests of the country have come forward, and from the circumstance of the rents of the country being paid about this time, the Banks which are now opened for ordinary business expect their Notes to pass currently.

R. Burdon, Esq.

21 March,

1797

J. Harman, Esq.

22 March, 1797.

Has the average quantity of Specie in that district appeared since 1793 to be increased or diminished?-I presume it must have increased, since so large a proportion of troops have been stationed in that district.

Mercuri, 22° die Martii, 1797

John Harman, Esquire; called in, and Examined.

HAVE you means of knowing in what manner the subsidies granted by this country to the King of Prussia, have been remitted from this country?-As to the latter part I have; I speak of that in the year 1794, between May and December.

Do you know of any other remittances made on account of such subsidies, except those in the year 1794 ?-I do not know, nor do I recollect any."

In what manner were the subsidies remitted, which you speak of as having been remitted in the year 1794?-They were remitted partly in Silver Bullion from this country; partly by Bullion procured in Amsterdam; partly by drafts on Amsterdam; and partly also by drafts on our House at London, drawn by the Maritime Society at Berlin.

With respect to the Bullion Silver remitted from this country, what did that consist of? -New Mexico Dollars.

Do you recollect the amount of the Bullion Silver remitted from this country?—Yes; I believe it amounted to 723,9581. sterling in value.

Are you able to state where such Bullion Silver was purchased in this country?-Most of it at the Bank of England.

Can you state what was the quantity of Bullion, which you mentioned as having been procured in Amsterdam ?-No; I can only state what sums were remitted to Mr. Hope, and what sums they drew upon us for.

Were these remittances and drafts made and drawn on account of the Bullion procured in Amsterdam?-Partly so, and partly for other remittances.

What was the amount of the remittances and drafts made and drawn on account of the Bullion procured in Amsterdam?-The fact is, when we had the offer of making the remittance for the Prussian subsidy, a good deal was submitted to our discretion, respecting the most advantageous modes of making those remittances; the Silver from hence was an obvious object; but there were other means; such as our remitting to Amsterdam, and directing Messrs. Hope and Co. to draw upon us, in order to furnish them a fund to buy Gold or Silver, or to remit, or to be drawn upon from Berlin. Remittances were also made by us to Hamburgh, and Bills drawn upon us from thence, for the like purposes. A large sum was also drawn upon our House by the Maritime Society at Berlin.

What was the amount of your remittances to Amsterdam on account of these subsidies? -About 89,2001.

In what manner were those remittances, amounting to 89,200l., made?-By Bills taken on the Exchange of London.

What was the amount of the drafts which Hope and Co. drew, in order to furnish themselves with a fund to buy Gold and Silver on account of these subsidies?-Their drafts for those, and the other purposes mentioned, were about 123,9741.

What was the amount of the remittances made to Hamburgh on account of these subsidies?—34,868 l.; but here I must add, that above 19,600 l. of these remittances were returned to us.

What was the amount of the Bills drawn from Hamburgh on your House, for the purposes of these subsidies?-About 86,2657.

What was the amount of the drafts on the same House from the Maritime Society at Berlin-I think I recollect exactly 80,000l.

Was the Bullion, which you have stated to have amounted to the sum of 723,9581. sterling in value, wholly exported out of this country in the shape of Bullion?-It went out all in Dollars.

Do you know whether any Coin of this country, or Specie or Bullion of any kind, other than the Dollars which you have before mentioned, were sent out of this country on account of the Prussian subsidies ?-I know of none..

Can you state to the Committee your opinion of the causes which have produced the late drain of Specie on the Metropolis ?-I should suppose that the late drains have been caused very much by the apprehensions of people respecting the safety of any other property, inducing them to collect Specie.

Can you form any opinion, whether this drain was greater on the present occasion than in the year 1793 ?--I should conjecture it to be greater.

Can

Can you form any opinion as to the causes which occasioned the apprehensions of people, to which you have alluded, with respect to their property?-The great decline of J. Harman, Esq. the Public Funds, and the general scarcity of Money, I should consider as causes.

To what do you attribute the great decline of the Public Funds?-To the vast increase of their amount.

Have you, in the course of your commercial transactions, had any Bills remitted to you on the Treasury?—Yes; many.

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Have those Bills been paid punctually, according to the dates, when they became due ?Yes; without a single exception.

Have you presented any such Bills for acceptance, to the Treasury, within the last four months?-I recollect only one for 5,000l. about ten weeks ago.

Was that Bill accepted, payable at the date for which it was drawn, or was the date of payment extended to a longer period?-To the best of my recollection, it was at a certain number of days sight; was accepted punctually from the day on which it was left,

How long have you perceived the scarcity of Money, to which you alluded in a former answer?-For a very considerable time past; with fluctuations of degree.

To what cause do you principally attribute that scarcity? To a decline of confidence; to the Bank having contracted their discounts; to the temptations of great interest, afforded by various public securities in the market; and probably other causes; which, unprepared for these inquiries, I may not recollect.

Do you recollect the period at which the Bank first began to contract its discounts?— I do not with accuracy; it might be about a twelvemonth past; but I do not exactly

recollect.

Can you assign the causes which may, in your opinion, have influenced the Bank to adopt that measure?-Asked for an opinion, it is impossible to avoid some reflection upon the subject; but my answer will probably be very much conjectural; one cause, the most obvious, seems to be the actual state of their own affairs; another, which appears to me highly probable, is that Paper might be sent in to them to answer purposes, which the Directors might not think it right to encourage.

Have you, in the course of the last two years, had any knowledge of the state of the Advances made to Government by the Bank?-Not being a Director, I can have no particu lar knowledge, other than I collect from the public papers.

From the knowledge you have collected, by whatever means, what opinion did you form, as a commercial man, as to the effect of the amount of those Advances on the general monied interest of the kingdom?—The greater Advances that the Bank should make for Government, the less their power must be to administer to any other objects.

Do you conceive that the quantity of circulating medium has been, for some time past, greater than the convenience of trade required?-Čertainly not.

Do you conceive that any considerable diminution of the circulating medium, below what the convenience of trade requires, has a tendency to produce commercial embarrassments and distress?-1 should think clearly so.

Are you not of opinion, that loans and subsidies to Foreign Powers, and Money expended on the armies abroad, have also caused the scarcity of Specie in this country? They cannot fail, I think, to contribute to it.

Is it your opinion, that any considerable degree of embarrassment and distress in the commercial world has, in general, a tendency to produce a disposition to get Specie into possession ?-I should think so.

Have you any means of knowing whether the Specie lately drawn from the Metropolis has or has not been exported out of the country?—I have no means of knowing it.

Nor of forming an opinion upon it?—There must always be a danger of an abuse of strong temptations of gain.

What, in your opinion, is the nature of the circulating medium which may be safely made use of in this country in the place of Gold and Silver?—I should think Bank Notes.

For what reason do you think Bank Notes may be safely made use of?-Because I have perfect confidence in the solidity of the Bank; this is my opinion.

Are you then of opinion, that any representative of Gold and Silver cannot be safely made use of, in which there is not perfect solidity?—I should think it follows of course.

Godfrey Thornton, Esquire, a Director of the Bank; called in, and Examined.

22 March,

1797.

Is it in your power to give the Committee any information respecting the increase or G. Thornton, Esq. dimination of Gold imported into Portugal from South America, for some time past ?-Not

G. Thornton, Esq. positively as to the quantity; in general, that the importation has diminished of late years,

22 March, 1797.

as I have been told.

Do you recollect any Gold being sent to the Brazils, for the purchase of cotton in that country? I have heard that such a transaction took place some years ago; but I cannot speak with certainty to it.

Can you give the Committee any information respecting the increase or diminution in the price of naval stores for some years past? I think I am competent to do so, it being my branch of trade. The principal article, hemp, is at the present moment more than double the price I have known it within these few years; that of iron in the same proportion: masts are also considerably dearer.

Has the quantity imported of hemp, iron, and masts, been, for the last two or three years, greater or less than formerly ?-Always considerably larger in time of war than in time of peace; particularly for the use of the Navy.

Has it been greater during the present war, or any part of it, than in former wars ?—In quantity I believe not very considerably greater; but in value by far greater.

What is the usual length of credit in the trade for naval stores?--We generally pay for those stores before hand, we never receive them upon credit; within the last two years a million sterling has passed through our hands for naval stores imported.

Is the great value of these naval stores imported remitted abroad, in returns of commercial effects, or in Money and Specie?-Not in Money and Specie; in the general course of trade.

Are the articles which are returned in the general course of trade principally purchased in this country?-Partly the manufactures of this country, partly East India goods, and partly West India produce.

Does it follow, in your opinion, from what you have stated, that a merchant dealing in the same quantity of naval stores during the present war, as the same merchant dealt in during former wars, must employ, for the purposes of his trade, a much larger capital, and therefore furnish himself with much more ample means of circulating his property?— Certainly, ist.

Are the articles of which returns are made to Russia, whether they consist of home manufactures, East India produce, or West India produce, increased in price proportionably to the increase of price upon naval stores?—I think they are advanced in value, but not in the same proportion.

When you say they are increased in value, do you mean goods exactly of the same quality, or that the quality and value of the articles have increased as well as their price?— I mean articles of the same quality at 400

To what articles in particular do you refer as being increased in price?—I mean all West India produce, and East India produce, as being dearer in time of war than in time of peace.

Can you inform the Committee, what is the usual credit given by the manufacturers or merchants of this country for the goods which they export into the Baltic ?~~The usual credit given in Russia on the sale of goods is usually twelve months. ^

Is the price of British manufactures exported to Russia increased ?--I cannot positively speak to that; they vary.

Is the demand for them from Russia considerably increased? I believe in general the value of the exports of British manufactures is increased; the particular articles vary from year to year according to the demand.

Is not the balance of trade with Russia considerably against this country? Yes....

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In what way is that balance ultimately paid to Russia?It is paid by the commercial transactions which arise between us and other countries.

Is not the balance against England considerably increased by the war? It is increased from the high price and quantity of naval stores imported by diz qon ka

Has the difficulty of procuring Bullion, generally speaking, been greater of late than in former years-The procuring of Gold has been difficult, from the reasons already given; because the quantity has been short from whence it comes. Adów „boen adidaq

Were those difficulties increased by the purchase of Bullion abroad for the Prussian and other subsidies?—Not to my knowledge, di lo subomia vas tadi menos I andW

Can you describe what appear to you to have been the causes of the drain of Cash which has lately taken place upon the Bank Unusual demands out of the country and also from private persons, not before in the habit of calling for Specie in large suins.99 To what causes do you attribute the unusual demand to which you have have alluded?The causes are unknown to me.

JinHave

Have you any reason to believe that the quantity of Specie now in the country is less G. Thornton Esq. than it has usually been?-It is matter of opinion, which I do not feel myself competent to give.

Previous to the unusual demands above mentioned, had not the Cash in the coffers of the Bank suffered a very considerable reduction ?-The Cash at the Bank has been in a state of reduction for some time past.

Can you assign the causes of such reduction -Not altogether; large sums have been sent to Ireland within these few months past.

Previous to the sums being sent to Ireland, had not the Cash in the Bank suffered a very considerable reduction ?--No, nothing considerable, to the best of my recollection.

Can you state, what particular circumstances in the situation of the Bank induced the Directors to come to the resolution of contracting their discounts at the end of the year 1795?-Because the application for discounts increased very much, and if complied with would call for a great increase of their Bank Paper.

Can you state, whether the quantity of Cash, or Cash and Bullion in the Bank at the time that resolution was made, was above or below what was considered as a fair average? -I cannot.

Can you state from what particular quarters the late extraordinary demand for Cash from the Bank was made?-Principally by Bankers; partly, as before stated, by persons not in the habit of calling for large sums.

ARE you engaged in any commercial business in the city of London ?-Only as a Banker, in which situation I have been about twenty-two years.

Are you a Bank Proprietor?--Yes.

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As a Bank Proprietor, has your attention been called to the affairs of the Bank?-Yes, considerably.

Have you, for any time past, felt any apprehension for the security of their affairs?I began to apprehend their situation was becoming rather precarious from the beginning of March 1796; and in consequence of that apprehension, I wrote a letter to the Governor and Deputy Governor and Directors of the Bank, on the 8th of March 1796.

Will you state to the Committee the ground for the apprehension which you began to entertain at that time?-The grounds of that apprehension are stated in that letter.

"Gentlemen,

[Which letter was delivered in, and read as follows :} .

"Although the trust delegated by the Proprietors of Bank Stock is the most important " and unlimited of any within my recollection, I have always been of the opinion, that it " is necessary for the good government of the Bank, and conducive to the general interests "of society; and have therefore uniformly resisted any application which has been made "for the disclosure of the accounts.

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"I know of only two circumstances that can produce any change of sentiment upon this " subject.

"If any of the Directors should ever so far forget the obligations of duty which this "confidence ought to inspire, as to avail themselves of the knowledge derived from their "situation, to seek their own emolument to the prejudice of the Proprietors interest; or "if they should admit any improper influence to preside in their counsels, that may induce "them to grant such enormous loans to Government, as may endanger the general secu"rity: the first is so manifest a violation of every principle of equity and justice, that "I trust I may flatter myself it will never be imputed to any individual in the Direction; " or if an instance of gross delinquency should occur, that there will always be found "sufficient virtue and integrity to dismiss such an unworthy member from the association. "The second may be assimilated with views of patriotism and a generous zeal for the "public good, which being laudable to a certain extent, is in more danger of being carried "to an extreme.

"When I consider that the amount of the debt delivered to the House of Commons, "with the original sum advanced, constitutes nearly double the amount of your whole "capital, and combine this with the liberal assistance given to the trading interest of the "country (the increased value of Gold, which with other collateral circumstances, must "have occasioned an important diminution in the Specie of the kingdom) I cannot divest "myself of some anxiety upon the subject. My apprehensions are increased from an " opinion I have formed, that the sums of Money raised for the services of the current

22 March, 1797.

S. Hoare, Esq.

23 March, 1797.