But this is evidently a very refined machinery, which a panic will be apt to destroy.

At the first stage A B may say to his debtor C D, 'I cannot take your cheque, I must have bank-notes.' If it is a debt on securities, he will be very apt to say this.

The usual practice--credit being good--is for the creditor to take the debtor's cheque, and to give up the securities.

But if the 'securities' really secure him in a time of difficulty, he will not like to give them up, and take a bit of paper a mere cheque, which may be paid or not paid.

He will say to his debtor, 'I can only give you your securities if you will give me bank-notes.' And if he does say so, the debtor must go to his bank, and draw out the 50,000 L.if he has it.