Unluckily, in the management of the matter before us--the management of the Bank reserve--the directors of the Bank of England were neither acquainted with right principles, nor were they protected by a judicious routine. They could not be expected themselves to discover such principles. The abstract thinking of the world is never to be expected from persons in high places; the administration of first-rate current transactions is a most engrossing business, and those charged with them are usually but little inclined to think on points of theory, even when such thinking most nearly concerns those transactions. No doubt when men's own fortunes are at stake, the instinct of the trader does somehow anticipate the conclusions of the closet. But a board has no instincts when it is not getting an income for its members, and when it is only discharging a duty of office. During the suspension of cash payments--a suspension which lasted twenty-two years--all traditions as to a cash reserve had died away. After 1819 the Bank directors had to discharge the duty of keeping a banking reserve, and (as the law then stood) a currency reserve also, without the guidance either of keen interests, or good principles, or wise traditions. Under such circumstances, the Bank directors inevitably made mistakes of the gravest magnitude. The first time of trial came in 1825. In that year the Bank directors allowed their stock of bullion to fall in the most alarming manner: On Dec. 24, 1824, the coin and bullion in the Bank was L 10,721,000 On Dec. 25, 1825, it was reduced to L 1,260,000 and the consequence was a panic so tremendous that its results are well remembered after nearly fifty years. In the next period of extreme trial--in 1837-9--the Bank was compelled to draw for 2,000,000 L. on the Bank of France; and even after that aid the directors permitted their bullion, which was still the currency reserve as well as the banking reserve, to be reduced to 2,404,000 L.: a great alarm pervaded society, and generated an eager controversy, out of which ultimately emerged the Act of 1844. The next trial came in 1847, and then the Bank permitted its banking reserve (which the law had now distinctly separated) to fall to 1,176,000 L.; and so intense was the alarm, that the executive Government issued a letter of licence, permitting the Bank, if necessary, to break the new law, and, if necessary, to borrow from the currency reserve, which was full, in aid of the banking reserve, which was empty. Till 1857 there was an unusual calm in the money market, but in the autumn of that year the Bank directors let the banking reserve, which even in October was far too small, fall thus: Oct. 10 4,024,000 L " 17 3,217,000 L " 24 3,485,000 L " 31 2,258,000 L Nov. 6 2,155,000 L " 13 957,000 L