The faith the public put in gold is probably greatly magnified. The public are not deeply versed enough in monetary and currency problems to understand the importance of gold as distinct from other money, especially legal tender paper. The ordinary man in possession of twenty £5 notes feels that he is equally as safe and as strong as the man in possession of one hundred sovereigns. We must not ignore this fact, nor minimize it, when we argue about high and low gold reserves. He knows that with notes he can be just as solvent as the man with gold, though he may think the notes a greater nuisance than gold. And this belief and trust of his, this calmness, are all essential elements of the psychological problem that confronts the currency theorist and the banker. They are not to be considered as mental phenomena independent of that problem. They go to make up its complexity. London being a free market for gold it was feared in a crisis such as we have experienced, that the gold would quickly be withdrawn from the Bank of England and shipped abroad, and that in a short time we should find ourselves with no gold reserves. This did not happen. Granted that a great deal of gold was withdrawn from the Bank, this was only temporary, and since those days the Bank has secured gold at a pace no prophet ever calculated. Two predictions here have also been falsified. Neither the gold withdrawals, nor the gold arrivals and accumulations were on a scale forecasted by the theorist. Their pre-calculations went ludicrously astray. CHAPTER XVII EQUITABLE RESPONSIBILITY If gold reserves alone are to be the test of sound banking, and if gold reserves alone are to save banks in the hour of crisis or panic, then the obligations of banks towards the highest interests of the community are weakened. If their wealth, their investments are to be valueless in a time of crisis, to be so ignored, that is, as to be worthless, to be taken no account of, are not to keep them solvent and safe, then on what grounds of reason and justice should the community demand that banks should confine their trading to the highest class of wealth? On what grounds can the community demand that they should in all seasons and in all times do that great work for trade and commerce which neither the Government nor any other institution does? Why should the banks be asked to do all the sacrificing within the limitations imposed by the community and the community not come to their help, sacrifice nothing at all, in the hour of the community’s troubles? For the crisis, when it comes, is the nation’s and not solely the banks’ crisis. If the crisis be none of the nation’s seeking, it will certainly be none of the banks’ seeking. If, however, the crisis be the effect of over-speculation on the part of the community, it would be mean action on the part of the community to appeal to the banks to save it from the consequences of its own folly.