We know, of course, that since the war the Bank has lent enormous sums of money by discounting pre-moratorium bills of exchange. This may seem to furnish proof of the inexhaustibility of the fund. But while it has been lending it has been simultaneously receiving gold. There has been no competition for the gold from South Africa and elsewhere, and therefore the Bank has been able to procure it in the usual way. Then New York has been obliged to liquidate its indebtedness to us in large amounts of gold. But with all this, the proportion of the reserve has kept well below the normal. What would have happened had the rebellion spread in South Africa, and had the mines there been closed down indefinitely? Even as it was, the Bank rate had to be maintained at an artificially high level compared with loan and discount rates in the outside market. CHAPTER XV THE THEORETIC LINE OF SAFETY It will be clear, I think, from the analyses in the foregoing chapters that banks have not only a delicate, but a most difficult task to perform. So difficult is the task that it is impossible to give satisfaction to all classes of the community. They have to give satisfaction to borrowers, to their depositors, to their shareholders and, at the same time, to the critics who say they are ever alert and watchful that they are trading within safe limits. What critics mean when they talk of safe limits they would not find it easy themselves to define with exactness. They know what they mean by sound principles of banking so far as lending on sound security goes. They know what they mean when they say that a bank must not engage in speculation, and that it must carefully scrutinize every class of wealth on which it lends. This seems to me a tacit acknowledgment that banks do not create credit in the sense that many suppose. It would come nearer the conception of credit creation if banks were allowed to speculate and attempt to create wealth out of nothing.