we must carefully remember, which, under the law, the Banking
Department of the Bank of England--as we cumbrously call it the Bank
of England for banking purposes--possesses. That department can no
more multiply or manufacture bank notes than any other bank can
multiply them. At that particular day the Bank of England had only
11,297,000 L. in its till against liabilities of nearly three times
the amount. It had 'Consols' and other securities which it could
offer for sale no doubt, and which, if sold, would augment its
supply of bank notesand the relation of such securities to real cash
will be discussed presently; but of real cash, the Bank of England
for this purpose--the banking bank--had then so much and no more.

And we may well think this a great deal, if we examine the position
of other banks. No other bank holds any amount of substantial
importance in its own till beyond what is wanted for daily purposes.
All London banks keep their principal reserve on deposit at the
Banking Department of the Bank of England. This is by far the
easiest and safest place for them to use. The Bank of England thus
has the responsibility of taking care of it. The same reasons which
make it desirable for a private person to keep a banker make it also
desirable for every banker, as respects his reserve, to bank with
another banker if he safely can. The custody of very large sums in
solid cash entails much care, and some cost; everyone wishes to
shift these upon others if he can do so without suffering.
Accordingly, the other bankers of London, having perfect confidence
in the Bank of England, get that bank to keep their reserve for
them.

The London bill brokers do much the same. Indeed, they are only a
special sort of bankers who allow daily interest on deposits, and