companies. The Bank of St. George, at Genoa, and other banks founded
in imitation of it, were at first only companies to make loans to,
and float loans for, the Governments of the cities in which they
were formed. The want of money is an urgent want of Governments at
most periods, and seldom more urgent than it was in the tumultuous
Italian Republics of the Middle Ages. After these banks had been
long established, they began to do what we call banking business;
but at first they never thought of it. The great banks of the North
of Europe had their origin in a want still more curious. The notion
of its being a prime business of a bank to give good coin has passed
out of men's memories; but wherever it is felt, there is no want of
business more keen and urgent. Adam Smith describes it so admirably
that it would be stupid not to quote his words:--'The currency of a
great state, such as France or England, generally consists almost
entirely of its own coin. Should this currency, therefore, be at any
time worn, clipt, or otherwise degraded below its standard value,
the state by a reformation of its coin can effectually re-establish
its currency. But the currency of a small state, such as Genoa or
Hamburgh, can seldom consist altogether in its own coin, but must be
made up, in a great measure, of the coins of all the neighbouring
states with which its inhabitants have a continual intercourse. Such
a state, therefore, by reforming its coin, will not always be able
to reform its currency. If foreign bills of exchange are paid in
this currency, the uncertain value of any sum, of what is in its own
nature so uncertain, must render the exchange always very much
against such a state, its currency being, in all foreign states,
necessarily valued even below what it is worth.

'In order to remedy the inconvenience to which this disadvantageous
exchange must have subjected their merchants, such small states,