digreffions, are comprehended in feven Chapters. The firft treats of Banks in general; the fecond exhibits a Compendious hiftorical view of the commerce of the Netherlands, and particularly of Holland, until the epocha of the erection of the Bank of Amfterdam; the third treats of the Bank of Amfterdam; the fourth contains a compendious hiftory of the trade of England from the time of Julius Cæfar to the epocha of the death of Henry III. in 1272; in the fifth the fame hiftory is continued, till the establishment of the Bank of England; the fixth treats of the Bank of England; the seventh and laft is defigned to give us an idea of the advantages and difadvantages that Banks may occafion in the focieties where they are erected.

The fecond and fourth Chapters are more inftructive to the Reader than neceffary to the main purpose of the Author, as they contain feveral historical details that have not a direct reference to the fubject of commerce. The first, third, and fixth Chapters, that relate to banks in general, and to the banks of Amfterdam and London in particular, and the feventh, that treats of the advantages and difadvantages of banks, are the refult of long and laborious refearches, and contain inftructive views of these important inftruments of commerce.

All the different banks, fays our ingenious Author, may be reduced to two kinds: they are either mere inactive depofitories, the value of whofe contents circulates in the public,- or they are commercial depofitories, which augment by trade the ftock, whofe value circulates on the wings of paper-credit. The Bank of Amfterdam is of the firft kind: it carries on no immediate commerce of its own: far from being the occafion of any prejudice to individuals, it furnishes them with a place. where they may depofit their cash with the most perfect fecurity. By the manner in which payments are made in bank-money among the merchants, the operations of commerce are executed with the greatest facility and expedition. The time and trouble that counting and tranfporting money must cost are faved, and the perfon that has depofited his property in the bank has nothing to fear from thieves or bankrupts.

But befides the utility of this establishment with respect to merchants and other private persons, there are feveral advantages refulting from it to the whole community: 1ft, The treasure of fuch a repofitory does not circulate all at once, either in commerce or in the community. 2dly, A repofitory alfo of this kind difconcerts, or renders fruitlefs, feveral operations of particular cafhiers, bankers, and stock-jobbers. There is another advan tage, which ought fcarcely to be mentioned, because it is a matter of the utmost delicacy, and that is, the refource that may be furnished by a bank, in fuch a period of extremity and danger as may juftify the employment of this facred depofitum.

004

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The Bank of Amfterdam being a mere depofitory, it is this circumftance that conftitutes its capital. For this capital it pays no intereft; on the contrary, the falaries of its officers are paid by the moderate charges to which the perfons who have their property in the bank are fubject, when they transfer that property, renew their titles in the registers, and on other occafions of a like nature. The other profits of the bank are derived from its eftimation of the gold and filver depofited, the value at which they are received, and the fums advanced upon thefe depofits. Thus the bank acquires a revenue that places it above the want of any fupply from government.

The cafe is not the fame, lays our Author, with the Bank of England. The principal object of the Bank of Amsterdam, which was erected in the year 1600, was to establish mutual confidence among traders, to maintain the credit of the Dutch commerce with foreign nations, and to accelerate its operations. The Bank of England, which dates its origin from the year 1694, was defigned to enable government to fill up, with facility, the fubfcriptions to a loan, which circumstances required. At King William's acceffion to the throne, the national debt amounted to about a million Sterling; but the high intereft of money, and the great quantity of fpecie that was thut up in the coffers of a fmall number of individuals, tendered it difficult to raise supplies; it therefore became neceffary to look out for an expedient that might, at the fame time, facilitate the loan, and reduce intereft to a lower rate. The capital that was to form the fund of the Bank of England, was not to be a mere depofit, but an object of circulation, defigned to give vis gour to the circulation of fpecie, and to produce confidence in all the operations of government relative to the finances. The capital of this Bank was a loan, to which many individuals fubfcribed with avidity, from the allurement of a high intereft. Foreigners, and perfons that carried on no trade, were permitted to place their money in the Bank, whofe capital circulating both in reality and in representation, increased in activity and value, and thus occafioned a reduction of interest, which produced great advantages to government, by the favings that refulted from it.

When the fubfcribers completed the payment of 1,200,000). in confideration of an annuity or intereft of 100,000l. this fum was thrown into the exchequer, to fupport the expences of the war, and the Bank procured elsewhere the funds which it wanted. It employed the fame ways and means which the bankers had formerly done at the exchange, with this difference, however, that the bankers had, in their own property, funds to fupport their credit, and carry on their operations; whereas

the

the Bank of England was furnished with money by private perfons, either fuch as placed their money at intereft, or fuch as depofited it in the Bank with a view to difpofe of it at pleafure. It was upon a capital fo formed, that the bank negotiated afterwards, and derived confiderable profit from making it circulate in commerce at the Exchange of London, All thefe objects combined enabled the Bank to lower the exorbitant intereft of money, which had taken place during several years, and to pay to its proprietors, all cofts deducted, a dividend probably much more confiderable than the intereft which was then common at the Exchange.

Such, according to our Author, are the principles by which the operations of the Bank are ftill directed, with fome modifications that arife from incidental circumstances. The funds. of the proprietors of this bank are fubject to the difpofal of government, and all its negociations elsewhere are fupported by its own credit. Our Author fhews, that this credit ought to have for its bafis public utility; and he points out fome of the principal circumstances that are neceffary to render such an establishment useful, and without which, he thinks, it must be rather, in the iffue, prejudicial to the public. We refer our. Readers to the Work itfelf for thefe details, which are inftructive, and furnish matter of ferious reflection. Our Author's great principle is, that all paper-circulation, that does not reprefent a capital really exifting in a bank, is prejudicial in the iffue;-and that more especially with refpect to a nation, the profperity of whofe inhabitants depends upon the activity of their commerce, it is neceffary that money alone should be the ineasure of those things that are the objects of commerce. He thinks, that in order to render the Bank of England a useful establishment, its fund fhould reft upon a capital furnished by the government or a fociety,-that this capital fhould be fufficient to fupply what the exigencies of commerce often require, -that, for this purpose, one part of this fund fhould lie inactive in the bank, to be ready for difcounting bills, advancing money on the public revenues, &c. while the other circulated in the public in current specie, or at least in paper, reprefenting not the credit of the Bank, but its folid contents.

According to our Author, the multiplication of circulating fpecie by bank notes and paper credit, instead of delivering from poverty, only difguifes mifery for a while. He alfo obferves, that money is debafed in proportion as the paper-figns that reprefent it, are augmented. It retains no longer that primitive. value that was annexed to it. He thinks, that the bank, whose. capital is in circulation, expofes to danger the fortunes of individuals, and makes an ill ufe of the confidence which the public has in it,-and that when it fends into circulation by its

credit,

credit, or its notes, a fum beyond its capital, it heightens the price of provifions, and becomes detrimental to fociety in many respects.

To estimate the prejudice occafioned by this ideal money, our Author examines the progreffive augmentation, that has taken place in the price of things, including in this eftimate, houfes, lands, the falaries of workmen, as well as victuals, and mercantile wares. But to build his calculations on folid ground, he does not take for his bafis the price of things, as it was fome years before the erection of the Bank of England, but goes as far backward as the beginning of the reign of Queen Elizabeth, because it was then that filver coin was regulated upon the footing on which it is at prefent; and alfo, because, during the whole reigns of her fucceffors, notes or paper credit were in ufe. Our Author then fuppofes, that in the time of Queen Elizabeth, there were four millions of fpecie, that circulated in England, and this account of the matter is generally adopted. He farther fuppofes, that thefe four millions were equivalent to five, on account of the difference between the population of England at that time, and its prefent population. This fum reprefented the riches of the nation at that period, and was fufficient for every object of commerce. About a century after, the current coin in England was valued, by fome able calculators, at eighteen millions and a half; which were then infufficient, if we judge by the credit and paper that were admitted, probably fince the conclufion of the reign of Elizabeth, or fince the reign of James I. The price of things being tripled fince the reign of Queen Elizabeth, the quantity of money, at the beginning of the eighteenth century, muft have been tripled alfo, in order to reprefent the value of things, as they were at the former of thefe periods. Farther, commerce, in its progrefs, has comprehended new objects, and thus created new wants: thefe objects require an augmentation of fpecie in order to their being continually reprefented. Again, the national debt, in proportion as it increases, requires a greater mals of money, or of fomething equivalent to money, in order to its being reprefented in the commerce of stocks, that is conftantly carried on in London; befides, there muft alfo be a reprefentation, not only of the objects of commerce, but also of the taxes and charges, which increase in proportion to the augmentation of the national debt. To fupport this heavy burthen, England is obliged to have recourse to ideal money, that is, paper credit. According to the most probable opinion, fays our Author, England poffeffes, at prefent, eighteen millions in real fpecie, and fifteen millions in circulating paper; and he thinks, that if this great mafs of paper had not been introduced, the real fpecie of eighteen millions would

have reprefented nearly what the thirty millions in fpecie and paper represent at this day, as all prices must have been proportionably regulated in confequence of this. He makes afterwards feveral reflexions on the intereft of money, and its variations in England, and draws from them fome ferious conclufions with respect to the ufe which this nation has made of its credit. The general truth that refults from the difcuffions contained in this first part of the Second Volume is, that loffes and inconveniencies may be occafioned by banks, which greatly exceed the advantages they are capable of procuring to the focieties where they are erected.

In the fecond part of this volume, which we expect from this well-informed writer, with impatience, he promises us a full account of what he understands by circulation, and fome reflexions relative to that object. He also proposes, in this fecond part, to treat concerning the origin of Lombards, of ancient and modern ufury, or intereft of money, of credit between individuals, of public credit, or of the origin of the prefent debts of almost all the powers of Europe, and of the influence, which thefe different objects have upon the general mass of national means.

The third part will begin, by a detail of the effects that have been produced by bills of exchange, in favour of which branch of commerce, our Author implores, with a kind of ardour, the protection and countenance of fovereign princes. and states, and defires, that they would act in concert in publishing, with respect to that most useful and important object, uniform regulations, that may be obferved in all countries. This difcuffion will be followed by our Author's ideas concerning the balance of trade, in which he folves the interesting queftion propofed, at the entrance of his work, viz. Whether commerce is not become too extenfive, and (confequently) contrary to the true interests of mankind? Our ingenious Author propofes farther, 'to add fome reflections relative to the true and effential interefts of the different European ftates, to fhew that the real riches of every community confift in the number, induftry, and manner of living of its inhabitants; and confequently, that whatever is prejudicial to good morals and population, is contrary to the true interests of humanity. All this will be followed by a Supplement to our Author's first volume, containing difcoveries relative to the money of the ancients, which have come to his knowledge fince the publication of that volume.