But this form of the opinion, though more reasonable and moderate, is not, therefore, more true.

The panic of 1866 is the best instance to test it.

As everyone knows, that panic began quite suddenly, on the fall of 'Overends.' Just before, the Bank had 5,812,000 L.in its reserve; in fact, it advanced 13,000,000 L.of new money in the next few days, and its reserve went down to nothing, and the Government had to help.

But if the Bank had not made these advances, could it have kept its reserve?
Certainly it could not.

It could not have retained its own deposits.
A large part of these are the deposits of bankers, and they would not consent to help the Bank of England in a policy of isolation.
They would not agree to suspend payments themselves, and permit the Bank of England to survive, and get all their business.