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860 THE LEAD E R. __^ fETo. 439, Attgtjs...
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THE ENGLISH, SCOTTISH, AND AUSTRALIAN CH...
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GENERAL TRADE REPORT. London, Friday Eve...
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Note: This text has been automatically extracted via Optical Character Recognition (OCR) software. The text has not been manually corrected and should not be relied on to be an accurate representation of the item.
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^—Should Bankers Pay Interest On Deposit...
used to settle accounts with foreigners ; and to make its increase or decrease the test of all profit is the consequence of a piece of erroneous legislation . Naturally , joint-stock banks and private banks , with their greater means , would look at the condition of trade and the character of their customers , to determine tlie rates at which they-would either lend or borrow : but the legislation which makes the cold in . the Bank the regulator of the rate of discount , makes the Bank of England the sole depository of all the money abstracted from the people by taxation , and at the same time makes
it the sole issuer of legal credit currency . The real legitimate instrument for liquidating debts is the precious metal , which has an intrinsic value of its own , not the promise to pay it ; but the legislator snakes the promise to pay of this one body a legal tender , and thus makes itself responsible for the species of money and the safety of the body which issues it . By judicious management the banks might always have as much gold at their command as -would exonerate them from dependence on the Bank of England , but without an alteration of the law they cannot he exonerated from dependence on it for a supply of the legal tender , and for loans which , must be had from the Bank -when
taxation places on its hands a very large portion of the money or representative capital of the community . By this means other banks are made dependent on the Bank of England . It is another name for the financial department of the State ^ and they place all their reserves in its safe custody . Other banks then are driven by legislation from their natural course , and are compelled to guide their conduct by that of the Bank of England , which rather hampers than helps trade . The law stands in their way , tut with the immense command of capital they
now possess , and the general confidence they enjoy , theywiu , perhaps , think the time is coming when they may disregard the rule of the Bank , and fix . the rate of interest they will allow on deposits and the rate of discount at which they will supply new enterprises with capital by the facts of each case . The flux of gold from and into the Bank is of immense importance to those who are responsible for the redemption of the legal tender , but it ought not to regulate the interest of money , as ifc neither does nor can regulate the rate of
profit-It can no wore lie said of bankers than of other men ^ that they always properly fulfil their high functions . Some of them nave been extremely reckless . The New York and other American banks , and our own banks which suspended in 1857 , can neither be excused nor exonerated . They neglected their duties ; but bankers are not likely either to know or perform their duties better by interposing short-sighted directions between them and the great natural facts by which alone business can be safely guided . For increasing trade and new enterprises legislation cannot lay down rules . Public writers
can say , without interfering in the technical part of the nice art of the banker , that he is likely to be successful , and deserves the coiifidence of his clients in proportion as he devotes himself steadily to his own "business . Under this aspect it is a fact of great importance that the Governor and Directors of the Bank of England are not bankers , and are engaged mother branches of business . Neither they nor the permanent officials of the Bank can adapt it to the circumstances of the times . Hence , with its large capital , it does not receive such large deposits as the loint-stock banks . Hence , too . its
conduct has on more occasions than one been so faulty , that it has been found necessary to regulate it by Act of Parliament . It is also a fact of almost equal importance that the partners of private banks have latterly been themselves much engaged in new enterprises ., or have become chairmen or directors of railway companies and of numberless other speculative undertakings . One of them is now a member of the . new council for India . If they lose the confidence of the publio , it will be their iauu
own . xne joint-stock banks act differently and are managed Toy gentlemen who , for a oertain but if successful , inoreaaing remuneration , devote their whole time and attention to one concern Messrs . Sorymgeour , Gilbart , Pollard , and other managers , do not figure as direotors of half a dozen companies . Tjiey give their whole souIb to their banking business—they skilfully adapt it to the wants of the oommunity—they allow interest on deposits , and they have accordingly acquired the publio confidence and have achieved a ffreat Buoceaa . °
860 The Lead E R. __^ Feto. 439, Attgtjs...
860 THE LEAD E R . __^ fETo . 439 , Attgtjst * j iorr
The English, Scottish, And Australian Ch...
THE ENGLISH , SCOTTISH , AND AUSTRALIAN CHARTERED BANK . The causes that have operated to curtail the profits of this bank during the last six months' trading , were clearly developed , not only in the report , but in tlie discussion which ensued at the meeting on Wednesday . It is so customary to see very large dividends declared by Australian , banks , that a dividend of four per cent , is sure 1 o attract attention and to require explanation . We find from the report that the limitation of profits arises mainly from , the prudence -which the managers have felt it their duty to exercise while the Tecent finans cial crisis and . its consequences were still in operation .
For this determination the managers deserve the tliankof the proprietary , and though they may thereby have temporarily curtailed dividends they will have amply made up for this by strengthening general confidence and by placing the business of the bank on a sound and substantial basis . Another cause which has operated to reduce dividends is the practice of allowing interest on current accounts . Now , on the propriety of this practice there does not exist an undivided opinion . It may be contrary to sound principles of banking as a rule , but it may "be exceptionally advantageous and expedient to a
particular bank . The proper judges of the matter , we apprehend , are those to whom the general management is entrusted , and we may be sure tliat it would not have been adopted unless found to be imperatively necessary for the interests of the banking business , or continued unless proved to be profitable in the result . But we find that the practice is about to be gradually discontinued , and we think the shareholders may safely leave the matter to > be dealt with by those -who can have but one object—that is , to promote the interests and prosperity of an undertaking with which they are connected . •» ¦ ¦'
We are always prepared to meet grumblers at meetings of joint-stock companies , especially when dividends disappoint expectation ; but we cannot find that any substantial ground of complaint was brought forward by any proprietor , though there were carpings by some and suggestions by others , all of which received due attention . •/¦ ¦ ¦ .- ¦ ¦'¦ ' ¦ ' ' '¦ ¦ . ' ¦ ¦ . ¦ ¦ - . ¦ ¦ ¦'¦ ¦ .- ¦' '¦¦ . ¦ Altogether ^ it appears to us that the proprietors have no reason to complain of their property or their prospects . . " ¦ ¦ '" ¦' . ¦; " , . ¦ ' . " ; . ¦ . ; '
General Trade Report. London, Friday Eve...
GENERAL TRADE REPORT . London , Friday Evening . The trade reports of this week , like those of the preceding vreek , confirm the belief that in most of the great branches of commerce , a period of considerable activityhas set in . Hearly all the leading industries are well if not fully occupied ; and it is satisfactory to observe that while there is nothing like rash or undue speculation , there is an increasing production , for -which , there is a natural and legitimate demand . This is remarkably the case in parts of Yorkshire ami Lancashire , and to some extent the same features may be found in the manufacturing districts of Scotland .- The iron and hardware trades still constitute an exception to the otherwise general progress of improvement ; but even in them , as will be seen from the abstract below , the turning point has been reached , and a favourable movement commenced , particularly in the home trade , where stocks are unusually low . After harvest , when there will be a considerable dispersion of money throughout the agricultural districts , an increased demand will arise , and the natural consequence will be a revival of activity in the workshops of Sheffield , Wolverhampton , and Birmingham . Meantime there is an appreciable improvement in the demand for goods from abroad . So that , on the whole , though there is unquestionably a good deal of dulness yet remaining in these important departments of British manufacture , there is good reason for anticipating that it is rapidly drawing to a close , to
bo succeeded by a lengthened pcxiod of briskness and prosperity . The general movement in trade is of course again visible in the traffics of the leading railways . Witt few exceptions there is an improvement in the merchandise receipts in tho wholo of them , while in all the comparative ratios of decrease arc becoming less and less . At the same time , and this is a safe indication , the commercial demand for capital shows no signs of relaxation . It is , indeed , increasing , and certainly will continue to do so for the next month or two ; but the supplies ate equal to tho inquiry , consequently manufacturers and merchants , notwithstanding their growing trade , have not to pay more than from 2 £ to 2 f per cent ., or at the most 8 per cent ., for their best bills . As far as most of tho Manchester traders are concerned this
is satisfactory ; for while the raw material is falling in the Liverpool market , and tho accounts from America are favourable , they are generally under contracts for yarns and goods made a week or two ngo , when cotton was rather Iiighor and money seemed likely to bo moro in request than it now is . To this view of tilings , which we are certain is not over-eanguine , there only remains to bo added that the harvest will turn out good throughout the United Kingdom ; and that ( a sure aig « of antioijpated prosperity ) the building trades oil over the
£££ & " * amt 0 ^ ^ thej Werc ^ elhMai In Manchester , the advance in the prices of yarns „« , goods may be considered as established , althouH ? h tendency of the Liverpool cotton market habfn t wards lower rates for the raw material-a tended % which largo buyers of gooda are generally not S * take advantage . But Manchester appears forX nH *? to be less dependent upon the Liye ^ ool cott £ ' XK than -, t used to be . Liverpool , indeed , is weak M . Chester rather strong and able to hold back £ Meantime there is a good steady demand for neark- in classes of goods , and from nearly all markets ; and fun pnees are paid for long-cloths , domestics , T-cloth < Z * most descriptions of printing cloths . The maSs i 40-inch shirtings , madapollams , and jaconets Su for the East , have not sold much , tocuXhSJtS
Bombay markets are very good , and yesterday ' s mart brought some large orders . The fact is explained W the failures at Calcutta having produced great cautior , among all the shippers to India , while those who deal with China are waiting the course of events . Still a great deal is doing for India , and more will follow It will take some time to overdo that market ; but it will be overdone in all probability . With regard to yarn and twist the spinners are exceedingly independent , esp ecially those who make No . 40 and downwards , as they have heavy contracts on hand . The spinners of the higher numbers are also very firm , though there is less demand for these qualities . On the whole , the Manchester trade is satisfactory , and there is no reason whatever to fear a reaction .
The accouiits from the woollen districts of Yorkshire this week are equally as favourable as those described in our last . In all departments , whether for clothing , worsteds / carpets , or yarns , it is much the same story ; and while the full employment of the population has produced agood / effect upon charges for themaintenance of the poor , it is also manifest in the erection of additional ,-bouses for the operative classes . In Leeds it is a subject of remark that , notwithstanding the differences with China , there is no falling off in the quantity or quality of the cloths ordered by the houses that principally deal with the East . The demand
for plain and fancy goods for the home market is steady , and rather increasing . The blanket districts of Dewsbury and Heckniondwicke are busy with , winter orders , and some have been received in anticipation of a trade with the colonists in the district of Frazer ' s River . At Huddersfield the aggregate bulk of -woollen goods sod this week has been large , and the demand remains very steady . The principal inquiry lias proceeded from the home trade ;' and it has included plain and fancy trouserings , heavy broadcloths , pilots , and most other descriptions . The orders are such that manufacturers are feeling themselves compelled to extend their powers of production ; but they are doing so only moderately . There are no signs of rash speculation . Stocks are very moderate and prices firm .
At Bradford the worsted trade continues active . Already light patterns have been submitted to continental buyers for next year ' s trade . Meanwhile the market for pieces , though less animated than it would be were wool not quite so high , looks satisfactory for the ensuing months , manufacturers being well , engaged upon contracts . Worsted yarns are in good demand at exceedingly firm prices . During the whole of this week bright-haired wools liavc been in good demand at upward prices . Deep-grown wools which assimilate to bright-haired are also in good demand at good prices . Other descriptions of combing wools , from No . 40 downwards , arc not in good request . The finer class of English
wools have not partaken of an advance corresponding withthntof the deep-grown nnd the bright-haired class , although tho best diamond teg and wither matching * have been and are still in guotl ' demand . There is no doubt much speculation in the Lright-Iiaired and t \ vcpgrown wools . Still there is a good business doing in , worsted yarns and pieces . The prices which arc received in both departments arc such as will generally enable the spinner and manufacturer to realise a profit . They arc in . most cases , liowovcr , working to order on transactions concluded a short time ngo , and there i * not tho same readiness there wns to yield tho utill advancing rates demanded in consequence of tho greater stillness of wool . There is a fair demand for cotton yarns , and
prices are firm . At Halifax briglil-hnired wools arc" advancing also . Yams nro being mado very extensively , nnd they arc selling at bettor prices . Tho carpet trade ia brisk , owing to the receipt of largo foreign and homo orders during tho last eight or ten days , including Homo connected with tho approaching visit of her Miijesty to I ^ eda in tho course of the ensuing month . The number of hands employed upon tho worsted trade is increaiing , Tho demand for light goods u |> i >« 'irs to bo pretty yw \ l satisfied , tho chief inquiry now being for those for autumn and winter wear .
Tlio Kochdalo manufacturer * lmvo received considerable home and foreign orders for flannels , and moat of the millH are well employed . Fino goods command n good market , and heavier descriptions aro fully an active . In fact , no now orders uro tukon without an increusou
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Citation
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Leader (1850-1860), Aug. 21, 1858, page 26, in the Nineteenth-Century Serials Edition (2008; 2018) ncse.ac.uk/periodicals/l/issues/cld_21081858/page/26/
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