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I: GENERAL COURT OF PROPRIETORS OF THE BANK OF ENGLAND121 March 1811 - David Ricardo, The Works and Correspondence of David Ricardo, Vol. 5 Speeches and Evidence [1819]

Edition used:

The Works and Correspondence of David Ricardo, ed. Piero Sraffa with the Collaboration of M.H. Dobb (Indianapolis: Liberty Fund, 2005). Vol. 5 Speeches and Evidence 1815-1823.

Part of: The Works and Correspondence of David Ricardo, 11 vols (Sraffa ed.)

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I

GENERAL COURT OF PROPRIETORS OF THE BANK OF ENGLAND1
21 March 1811

Mr. Cattley, the first speaker, ‘entered into a vindication of the Bank, against the attacks made upon them by the Bullion Committee, Mr. Huskisson and others. He said that the Bullion Committee should have examined into the causes of the high price of bullion, which they had wholly neglected to do—and it would not be just to require of the Bank to pay their notes in specie, whilst gold was at so high a price’.

Mr. Ricardo ‘then rose, and was proceeding to make some observations on the remarks of Mr. Cattley, when he was reminded by the Governor that there was no question before the Court.’

Mr. Ricardo said, that he would have wished to set the Honourable Proprietor right, with regard to some of the facts which he had stated respecting the Bullion Committee, but as such discussion was not thought admissible he would confine himself by putting a question to the Directors. He said that in the discussion of principles, it was highly essential that the facts by which those principles were ultimately to be tried, should be correctly stated. He had observed, however, that in the papers which had at different times been submitted to Parliament, there appeared facts which were at variance with each other, and of which he hoped the Court would receive some explanation. It appeared, he said, by a paper which was published in the Appendix to the Report of the Secret Committee of the Lords, that in October of the year 1795, the Directors stated the price of gold bullion to be 4l. 3s. to 4l. 4s. per ounce,2 although no traces of any such price could be discovered in any list that was published during that year; on the contrary, the price quoted in December of that year, in the list which Mr. Goldsmid, in his evidence, declared to be authentic, as he himself furnished the prices to it,1 was 3l. 17s. 6d. That further, in 1797 Mr. Newland, in his evidence before the same Secret Committee, had declared that he had known the Bank to give as much as 4l. 1s., 4l. 2s., 4l. 6s., and as high as 4l. 8s. per ounce and when asked on what occasion the Bank gave 4l. 8s. said it was about two years since, speaking then in March 1797.2 Mr. Ricardo said that there was a paper just laid before Parliament by the Bank, in which they stated, not the lowest, not the average, but the highest price which they had given for gold bullion from 1773 up to the present period. In this account it appeared that the Bank had never given more, from 1786 to 1800, than 3l. 17s. 10½d. per ounce.3 He found it difficult to reconcile this seeming contradiction, and he hoped the Directors would explain it.

Mr. Pearse, the Governor, ‘observed in reply, that the price being stated by the Directors to be 4l. 3s. or 4l. 4s. per ounce in the year 1795, did not afford any proof that the Directors of the Bank had purchased at that price. That 4l. 8s. being given, as stated by Mr. Newland, was, he believed, correct—it was by way of experiment in the beginning of the year 1796, and was obtained by their agent in Portugal, but which was discontinued after a small quantity had been purchased. That in a return which they had since made to the House of Commons, they had stated this and some other exceptions.’4

[1 ]Report in the Morning Chronicle of 22 March 1811.

[2 ]See ‘Report of the Lords Committee of Secrecy, 1797’ (reprint in Parliamentary Papers, 1810, vol. iii), p. 84.

[1 ]Goldsmid in his evidence stated that the Tables ‘published by Wettenhall are likely to be correct; they are made from our reports to the person who furnishes him with the prices’ (Bullion Rep. p. 36).

[2 ]‘Report ... 1797’, p. 40.

[3 ]See ‘Bank of England, Accounts...’, ordered to be printed 22 Feb. 1811 (No. 5 of these Accounts is ‘An Account of the highest Prices paid by the Bank for Bullion in each Year, from 1773 to 1809, both inclusive’), in Parliamentary Papers, 1810–11, vol. x, No. 22. Cp. above, III, 77, n.

[4 ]See ‘An Abstract Account of the Prices paid by the Bank of England for Gold and Silver Bullion, in each Year, from 1697 to 28 Feb. 1811’, in Parliamentary Papers, 1810–11, vol. x, No. 69.