The statement, which follows, shows the daily fluctuations in the price of American gold coin at the Exchange Gold Room during the month of August: COURSE OF GOLD AT NEW YORK, AUGUST, 1867. 4.. 5. 6.. 7.. 8. 9.. 10.. Foreign exchange has ruled steady throughout the month, at a fraction below the specie shipping point. The supply of bills has been strictly moderate, and the demand equally so. Bankers have not drawn much against account. The following table shows the course of foreign exchange, daily, for the month: Days. 1.... 2.. 3.. COURSE OF FOREIGN EXCHANGE (60 DAYS)-AT NEW YORK—AUGUST. London. cents for Paris. Amsterdam. centimes cents for for dollar. florin. Bremen. Hamburg. Berlin. cents for cents for cents for 54 pence. rix daler. M. banco. thaler. 109@110% 5134@512% 41%@41% 79 @79% 86%@36% 72% @72% 109%@110% 513%@512% 414@41% 79 @794 36%@36% 724@72% 1094@110 518%@513% 40% @11% 784@79 35%@36% 71%@72X 109%@110 515 @513% 41%@41% 79 @79% 36%@36% 721⁄4@72 109%@110 5184@513% 40% 41% 78 @78% 35%@36% 71%@72% 109%@1094 5184@513% 40%@41% 78 @78% 35%@36% 71@72 109%@109% 5184@518% 40% @41% 78 @78% 35%@36% 71%@72 109%@109% 5184@513% 40%@41% 78 @78% 25%@36% 71%@72 109@109% 5184@513% 40% @41% 78 @78% 35%@36% 71%@72 11. 12 13.. 14.. 15.. 16... 17.. 18. 19. 20. 21. 22. 23. 24. 25 26. 109%% @109% 5184@515 29 40%@41% 78 @78% 35%% @36% 72 @72% 41%@414 783% @78% 36%@36% 72 @72% 41%@414 783% 078% 36%@36% 72 @72% 41%@414 783%@78% 36%@36% 72 @72% 41%@41% 78% @78% 36%@36% 72 @72% 41%@414 78% @78% 36%@36 72 @72% 40%@41 78 @78% 35%@36% 71%@71% 40%@41 109%@109% 516@515 41 @414 109%@109% 51644@515 78 @78% 35%@36% 71%@71% 78% @78% 36%@364 72 @724 78% @78% 36%@36 72 @72% 78% @78 36%% @36 72 @72% 78; 8% 36%@364 72 @72% 78%@78% 85%@36% 71%@72 41 @41% 41 @414 41 @414 40%@41 109%@110% 518% @512% 40% @41% 78 @79% 354036%% 71%@72% 10934@110% 517@511% 40% @41% 78 @79% 36 @36% 71%@72% 109%4@110% 5184@511% 40% @41% 78% 794 36 @36% 72 @72% 109%@110% 520 @510 40%4@41% 78% @80 36 @36% 71% @72% 1084@10% 522@512% 40% @11% 78% 79% 35% @36% 71%@72% 108 @1094 525 @515 40%4@41% 78 @79% 35% @36% 71%% @72% 108%@109 522@515 40%@41% 78@794 36 @36% 71%@72% 108%@109% 520 @513% 41% @41% 78% @79% 36%@36% 72 @72% 40%@41% 78 @80 35%@36% 71X@72% Since Jan. 1..........10s @110% 525 @510 109%@109% 5184@513% 40% @41% 78 @78% 35%@36% 71%@72 JOURNAL OF BANKING, CURRENCY, AND FINANCE. Returns of the New York, Philadelphia and Boston Banks, Below we give the returns of the Banks of the three cities since Jan. 1: 9. Debt and Finances of Buffalo.. 196 25. City and County Debt of New York 198 State 238 26. Public Debt. 239 27. Commercial Chronicle and Review 201 28. Jonrnal of Banking, Currency, and 240 Finance 247 10. Life Insurance in the United States... 13. Public Lands of the United States.... 203 The following advertisements appear in our advertising pages this month: THE MERCHANTS' MAGAZINE AND COMMERCIAL REVIEW. OCTOBER, 1867. CAUSES OF FLUCTUATIONS IN THE BANK OF ENGLAND RATE OF INTEREST. Nothing is more certain than that we cannot make money easy and enforce a low rate of interest by legislative enactment; still one of the important necessities of modern commerce is a moderate equable interest for money borrowed, and if we can secure this to any country we shall confer a benefit which it is not easy to overestimate. Napoleon I., therefore, was not so far wrong when he said that the chief use of a great National Bank, and almost the only excuse for its existence, was that it should lend money at a low steady rate of interest. There is no doubt that in our times, under the existing methods of organizing industry, severe and sudden fluctuations in the price exacted between borrowers and lenders of floating capital, are likely to inflict heavy losses on individuals, to check the growth of national wealth and productive power, as well as to become the fruitful cause of disappointment, bankruptcy and suffering to the industrious and enterprising classes of the community. It is one of the proud characteristics of the Bank of France, that whatever else may be said to its disparagement, its rates of interest have been raised very little and very seldom from the average of four per cent. during the present generation, and it is one of the most grave and damaging charges which has ever been brought against the Bank of England and against the British system of financial machinery, of which the Bank forms a controlling part, that its minimum of interest has fluctuated from 2 to 10 per cent. with a frequent violence which has baffled all forecast; and that ever since 1844, when the present Bank Charter was passed, such spasmodic anomalies have been much more remarkable than ever before. On this account that charter has been held responsible for all the mischief. The arguments post hoc ergo propter hoc is an easy one to urge, and too often a difficult one to refute. The general expectation has been that the British Parliament would appoint a commission for taking such evidence as the panic of 1866 might evolve to throw light ou the increase of monetary stringency by the operations of the Bank. It is to be regretted that in the reform agitation which has convulsed England during the past session, these financial questions have been crowded out and forgotten. Meanwhile, valuable facts are fading from sight. The memory of such events soon becomes confused, and the evidence conflicting. Theories dominate facts, and at some future time, when the inevitable inquiry is to be made, we shall come to it in a cooler and more judicial temper, perhaps; but with a less vivid recollection and a less adequate view of the evidence to guide us to right conclusions. We have said that it is impossible to regulate the rate of interest by act of Parliament. If we were to go further, and affirm that the Bank Charter Act of 1844 is not responsible in any direct manner for the perturbations of the money market which have followed it, we should not concede that an inquiry into the operation of the act would be unnecessary or fruitless. The bank charter is one thing, and the action of the Bank directors under that charter is a very different thing. The former may be good, while the latter may be more or less bad. The fact is that all the legislation of the English Parliament relative to the Bank since the celebrated Currency Act of Mr. Peel in 1819, has avoided intermeddling with the rate of interest, and has been directed to a totally different object-namely, the preservation of the nation from the currency troubles which were so serious during the first two decades of this century. What that legislation has aimed to accomplish is to keep the currency of England at par with gold, and to prevent its bank notes from ever again depreciating or falling to a discount as compared with coin. The object has been fully secured for nearly half a century, and it has been done by the application of the safeguard for whose virtue and efficiency this journal has always contended in regard to our own currency. The safeguard is founded on the principle that the amount of the currency afloat in any country regulates the value or purchasing power of that currency. It being acknowledged that if more currency is afloat than the business of the country requires on a par basis, the value of the currency will fall below par, the currency-issuing institutions of England are put under stringent restrictions. And the only increase that currency can receive beyond a fixed amount must be issued to represent gold coin or bullion actually in the vaults of the Bank, and ready to be paid out on demand. The great aim of the Parliament then has been to prevent depreciation, or, as it is sometimes expressed, “to secure the convertibility of the note;" and this aim, we repeat, the successive legal enactments have fully accomplished for fifty years during which they have been in force. This point has indeed been urged as an argument against further investigations by parliamentary commissions, in addition to those which have taken place in past years. |