We next have to consider the amount of pressure the customer can bring to bear on his banker, of whom his securities make him practically independent. He may, in the first place, threaten to remove his account unless his banker grant him a loan at 3½. Secondly, he may decide that it will pay him better to sell his debentures at the market-price. Again he may only require the loan for a few months or even weeks; and as, in his opinion, the debentures will probably appreciate in value, he may decide to pay 4 per cent. for a short period to either selling out or troubling to find a cheaper market. Obviously, the higher the Bank rate advances the less disposed is this class of customer to pay ½ per cent. above it; so, when the official minimum is at 5 and 6, he can often arrange for an advance at Bank rate or even at a ½ below it. On the other hand, the banker, when Bank rate is at 2 or 2½, generally refuses to lend at less than 3 per cent. per annum. The rate, therefore, upon a secured advance is influenced by the nature of the cover deposited as well as by the state of the money-market. This description of the market is, of course, the veriest sketch, but, perhaps, it may possibly prove somewhat enlightening to those who have hitherto regarded this very simple subject as an exceptionally difficult one. CHAPTER VII LOANS AND ADVANCES IN LONDON We are told that London banking is quite different to country banking, but it is a difference of degree rather than of kind, and in London, as in the provinces, the bank-manager has two rates--one for those who, taking him at his word, do not attempt to bate him down, and a second and lower rate for those persons who, knowing that he is of the City, and scenting instinctively a servant of the company, who is in possession of instructions, literally force his hand. A seller in a free market where competition is vigorous generally has at least two prices, though, of course, he only advertises one of them, and the banks, which are not one whit in advance of the commercial ethics of the times, base their rate upon expediency as well as upon the Bank of England’s rate of discount. In stating so human and obvious a fact one can only apologize for its intense triteness, and urge, in extenuation, the blind, unreasoning faith of some people in the modern bank-manager. Such faith may be beautiful, but, believe me, it is costly.