This table is an example of the well-known saying that anything can be proved by figures, and of the care which must be exercised in employing statistics, for the first result is to show that only about 4 per cent. (£18,176,000) of the gold received at the Bank in 21 years (£395,046,000) is light. But it is readily apparent that this low percentage is arrived at owing to the overwhelming amount paid in by bankers, who, as we have already seen, use every means to avoid the loss entailed by paying in ordinary gold. It is not a little remarkable that the percentage of light gold received from bankers in 1871-80 is not much more than half of what it was in 1860-70, and this in spite of the Treasury minute of 21st June, 1870, under which light gold was made receivable at 778.9d. instead of the former price of 778.61d. The higher percentage of light gold received from customers in the second period is what we should naturally expect. I venture to think that in the case of the bankers, the increasing amount of light coin renders them more and more cautious as to the quality of the gold they send in to the Bank of England. As regards the Post Office it is likely that the popular impression that light gold will be clipped or refused tends to make the quality of that received across the counter of a better average quality; but of the light gold that is received by post-offices it is well known that as much as possible is paid away in wages to subordinate officials, and the story is notorious of a depositor who withdrew his savings in gold, which on being paid in to the Bank of England was cut as light. Even thus the Post Office has paid in during 1871-80 £2,266,000 of light gold, or about a quarter of a million per annum. It may be hard on the department, but it is satisfactory to find that in this case the nation, though indirectly, has to bear the loss. This loss is now estimated at more than £6,000 per annum, and will no doubt tend to increase, since the Post Office has of late years relaxed the rule as to declining light gold. With regard to the actual loss in light gold, I must add that since composing Table III. it has come to my knowledge that the loss on £1,000 in light sovereigns paid in by the Post Office is £12. 108. as against my own estimate of £11. 12s.; but in the case of half-sovereigns, in which from Table IV. we can infer that the loss on every £1,000 in light half-sovereigns would be £17. 168., the experience of the Bank, referred to on p. 307, shows a rate of loss of £22. 168., and the Post Office of £21. 68.

Another case of actual experience is the one referred to in the Report of the Committee of 1881 (City Lands, Thames Embankment, Bill), namely, that of the West of England Bank, whose tillmoney was collected and sent up to the Bank of England after its failure; the result was as follows:

The former result being not altogether wide of that shown in Table V., which exhibits the analysis of 1,000 sovereigns drawn from the same district; but in the case of the half-sovereigns there seems to be further evidence that Table IV. under-estimates the average amount of depreciation.

On the failure of the City of Glasgow Bank two large parcels of gold were sent up; they differed widely in quality, as the following summary shows:

a percentage sufficiently near to the estimated 547 per cent. of Table III.

I venture to think that whatever criticisms may be made on the estimates arrived at in Tables III. and IV. they will at any rate not be held to err on the side of presenting an exaggerated case.

PART III.-Possible Measures of Reform.

The preceding pages have, I trust, not so much demonstrated the defective condition of our gold coinage as illustrated the acknowledged extent of its deterioration. That the result of various observations do not always lead to an exactly identical conclusion will surprise no one who has attempted to grapple with any similar problem of which the conditions are so uncertain and subject to so many disturbing influences difficult to appraise at their true value. The exact amount of the deterioration of our gold coins will probably never be known until it is ascertained by the practical experiment that must inevitably some day be made; in the meanwhile we can but collect such evidence as lies to our hand, and draw therefrom such inferences as we may. One thing only is certain, the evil increases with time, and the reckoning must inevitably be heavier as we postpone its settlement. It only remains to consider very briefly the measures by which the present condition of things may be ameliorated.

I approach this portion of my subject with the utmost diffidence, and with the most lively sense of its difficulties. The collection and comparison of facts is indeed sufficiently laborious, and full of stumbling-blocks and disappointments; but to draw inferences from, or to dogmatise upon, the results which observed facts afford, is a course yet more beset with pit-falls. This is especially the case in such an instance as the present, in which the subject-matter under consideration is by no means new, but has undergone at various times and in its bearings on other topics an almost exhaustive

discussion. The investigations of the Parliamentary Committees of 1868, 1875, and 1881, more than once referred to in this paper, were extended to an inquiry into the condition of the coinage, though the question of its reform was not iminediately before them.

It may be urged that the first step must be to ascertain what it is with which we have to deal, what is the actual volume of English gold coin now in existence? This is a problem that has sufficiently exercised some of our most able financiers and statisticians, and I trust that I may be excused from adding an estimate to those already made by such men as Mr. Palgrave, Mr. Hendriks, Mr. Ernest Seyd, Mr. Kirkman Hodgson, Mr. Newmarch, and Professor Jevons when such doctors disagree, one may fairly decline to decide. These estimates were made some years ago, and varied from less than £80,000,000 to £117,000,000. Since that time the growth of population, of revenue, and a rise in the general rate of wages, more rapid than the rise in taxation, or in the price of articles of common consumption, may I trust be taken as proof of the general increase of wealth and spending power of the people. The demand for an increased metallic circulation which such conditions would naturally engender has been kept in check by additional banking facilities, by a more extensive investment in savings-banks and diminished hoarding, and by an increased use of postal orders and notes in the remittance of small sums. On the other hand, it is possible that the co-operative system may have caused an increased demand for coin, and the ready-money tariff adopted by tradesmen in their competition with the "stores" would work in the same direction. But whatever importance we may attach to these or other considerations, the fact remains that the activity of the English and Australian mints have in the last ten years added no less than £76,000,000 to the gold coinage. From the grand total of £308,000,000 we have to deduct the amount of £14,000,000 known to have been withdrawn in 1841-43, and the amounts cut as light at the Bank of England before and since those years. Even this it is not easy to ascertain. We have seen that it was £18,000,000 in 1860 to 1880, and it appears probable that in the years 1840 to 1860 it was not half of that amount. We have further to estimate the gold lost by fire or shipwreck, the latter probably by far the largest quantity; the loss by forgotten hoards; the amount melted down by jewellers and for purposes of art, as to which widely differing estimates have been made; and the amount absorbed by India and the East, and employed in its unaltered shape for personal adornment. To these deductions we must add the amount of English gold coin used as legal-tender coin in Portugal and her dependencies, and to a great extent in Egypt, Brazil, and elsewhere, all of which has passed out of the English circulation. Whatever be the net remainder, after deducting these various unknown quantities, whether it be within the limits of previous

estimates, or considerably in excess of them, I hold to be comparatively immaterial. The expense of recoining one hundred millions of sovereigns was estimated by the Mint authorities in 1868 at £559,950, and when a recoinage is determined on, a much larger expense should not stand in the way of the richest nation in the world, a nation which nearly two hundred years ago (1696) did not shrink from appropriating £2,700,000 to the restoration of its silver currency.

But to a Chancellor of the Exchequer sufficiently liberal to devote a surplus to or to impose taxation for this purpose, it might be objected that the remedy is provided by the existing Act of 1870. The reply is that this Act is altogether unjust, that it is to a great extent a dead letter, and that its strict application, were it possible, would be altogether impolitic. Under the Act the sovereign of ideal weight and fineness is issued at the value (in terms of gold) of twenty shillings, and is allowed to pass from hand to hand until it is intrinsically worth only 198. 10d. (238-493d.); but the next holder, in whose pocket it suffers the least further abrasion, is mulcted not only in this amount, but by the difference between the buying and selling price of gold at the Bank, viz., 1d. per oz., or on each standard sovereign 385d., making a total of a little less than 2d. (1.892d.). To give an extreme illustration of the unfairness of this law, suppose that A were to pay into the Bank of England 50,000 standard sovereigns and 50,000 that just failed to turn the scale, while B were to pay in 100,000 sovereigns, each of which was just over the minimum legal tender limit of gr. 122.5, the result would be that A's parcel would be worth at Mint buying price £514. 138. 8d. more than B's, but he would be charged a loss of £394. 58. 9d., while B would lose nothing. But if in spite of its inequities the applications of the law were insisted on and enforced, the difficulties and discontent which would arise would soon make it intolerable. We have seen that the competition of intruding banks has caused the practice of testing the weight of gold in many cases to fall into desuetude; it is even a grievance of the Bank of England that its exceptional practice in this respect places it at a disadvantage, and keeps away accounts, and in some cases government accounts, which would otherwise come to it. A general agreement among competing banks on this point would therefore be necessary-they would, one and all, charge their customers on light gold. These would retaliate in self-defence-the brewers would decline to take light gold from their publicans, and the publicans again would refuse it from their patrons. Every retail dealer would do the same, and no cash transactions at a fair or market could be completed, no railway ticket taken, without the use of a pair of scales. Endless wrangling would arise in all directions, and the loss would, no doubt, fall most heavily on the wage-receiving class, who would hardly be in a position to refuse a light coin tendered in payment,

and who would probably have to pay an excessive amount in order to get rid of it. If a sovereign taken in wages proved to have only a purchasing power of 198. 8d., the loss of the price of a quart of beer would be no slight grievance. Such a state of things may seem exaggerated, but a stringent application of the Act would necessarily produce it, and a prudent government would do well to adopt remedial measures before, and not after, the development of the popular discontent that would inevitably arise. I can only see one possible advantageous result, viz., that the discredit into which the gold coinage would fall might tend to bring silver into favour among the wage-earning class, a result which might commend itself to those who would re-habilitate the white metal, though not, I fear, to the authorities of the Mint.

But even, if by a stroke of the pen the restoration of the gold coinage were brought about, and a sovereign of standard weight could be at once substituted for every one now in circulation, the reform would only be half complete. We have seen the perils that encompass the heavier coins, how they are attacked by fraud, exported as a convenient form of certified bullion, and employed similarly at home for purposes of art or ornament. If all light gold were receivable at the Bank of England by tale, it may be objected that fraudulent tampering with gold would at once increase. It is not certain that this need necessarily be the case. If we knew that light coins were the exception, and that effective provision existed for withdrawing them from circulation, we should all look askance at any coin that had the slightest appearance of excessive wear. It is not impossible that the result might be rather the other way, and that "sweated" coins might become less common than at present. But a provision for the indiscriminate calling in of light coin is not the only alternative. We know very nearly that the average life of a sovereign and half-sovereign should be, (at the mean annual rate of wear and tear,) 17.9 and 11.6 years respec tively; but that the faster rate of wear and tear in the earlier years brings down the period to 16 and 11 years respectively. I do not see why an allowance of 1 grain in every sovereign of twenty years old, and of grain in a half-sovereign of ten years old, and so on in proportion to age, should not be made at the expense of the State.* The public at large enjoys the convenience of a gold coinage, and should bear its share in this expensive luxury. At the same time it should bear no more, and any one receiving a flagrantly light coin of modern date would do so at his own risk. The labour of examining the date of each coin would, no doubt, be considerable, but would perhaps not entail more labour than the registration of cancelled bank notes, certainly not more than will be involved in the decomposition of the printers' "pie "

* See Note C on the Gold Currency of the United States.