The Bank of England could not sell 'securities,' for in an extreme panic there is no one else to buy securities.

The Bank cannot stay still and wait till its bills are paid, and so fill its coffers, for unless it discounts equivalent bills, the bills which it has already discounted will not be paid.

'When the reserve in the ultimate bank or banks--those keeping the reserve--runs low, it cannot be augmented by the same means that other and dependent banks commonly adopt to maintain their reserve, for the dependent banks trust that at such moments the ultimate banks will be discounting more than usual and lending more than usual.

But ultimate banks have no similar rear-guard to rely upon.
I shall have failed in my purpose if I have not proved that the system of entrusting all our reserve to a single board, like that of the Bank directors, is very anomalous; that it is very dangerous; that its bad consequences, though much felt, have not been fully seen; that they have been obscured by traditional arguments and hidden in the dust of ancient controversies.
But it will be said--What would be better?
What other system could there be?
We are so accustomed to a system of banking, dependent for its cardinal function on a single bank, that we can hardly conceive of any other.

But the natural system--that which would have sprung up if Government had let banking alone--is that of many banks of equal or not altogether unequal size.