Now, a banker’s liabilities to the public are due on demand, and at short notice; and they would consist principally of “deposit and current accounts, and notes and drafts in circulation.” These, of course, will be found on the left-hand side of the balance-sheet. As the banker’s deposits may be demanded from him at any unlucky moment, it follows that he is compelled to hold a certain sum of cash (legal tender) in reserve; and the larger that sum, the safer are the customers’ balances. A person, therefore, who is looking for a safe banker, should see that the firm or company which he selects possesses at least from £12 to £18 in coin, bank-notes and cash with the Bank of England against each £100 it owes to the public. He will find the public liabilities on the left-hand side of the balance-sheet and the cash in hand on the right; and a proportion sum will soon give him his answer. But a really strong, well-managed bank only advances to, and discounts bills of exchange for, its customers to such an extent as will enable it to hold from £45 to £50 in cash, money at call and investments to every £100 of its public indebtedness. Cash, of course, is its vital asset; and after cash comes Consols and other British Government securities in which, except at the very height of a panic, there is always a market. These are a bank’s so-called liquid assets; and it may just be added that when a bank mixes its cash and money at call and notice together, and an accommodating auditor declares that such a medley “exhibits a true and correct view of the state of the company’s affairs,” the bank is probably so weak in actual cash as to deem it wise not to publish the figures. Money at call and short notice would represent advances to the bill-brokers and to the Stock Exchange; and though such loans could doubtless be easily called in during normal times, they would be difficult to collect when the money-market was in a turmoil. A greater part of the advances made to the Stock Exchange, though classed as liquid assets, are in reality loans in disguise; for if the banks were to suddenly ask the stockbrokers to redeem their pledged stocks and shares, those gentlemen would be hammered in clusters; and the shares, when flung upon the market to be sold at what they would fetch, would rapidly depreciate. It would certainly be interesting were the banks to specify the amount of their so-called short loans to the Stock Exchange; and, with a lively recollection of 1890, it is to be hoped that they are kept within bounds, as, upon that occasion, this class of advance hung like a mill-stone round their necks. Such liquid assets, it is to be feared, are more likely to sink the good ship than to save her in a storm.