If there were a new issue to such an amount as that contemplated--viz., five millions--there would be a great danger that the whole mass of Exchequer Bills would be at a discount, and would be paid into the revenue.

If the new Exchequer Bills were to be issued at a different rate of interest from the outstanding ones--say bearing an interest of five per cent--the old ones would be immediately at a great discount unless the interest were raised.

If the interest were raised, the charge on the revenue would be of course proportionate to the increase of rate of interest.

We found that the Bank had the power to lend money on deposit of goods.

As our issue of Exchequer Bills would have been useless unless the Bank cashed them, as therefore the intervention of the Bank was in any event absolutely necessary, and as its intervention would be chiefly useful by the effect which it would have in increasing the circulating medium, we advised the Bank to take the whole affair into their own hands at once, to issue their notes on the security of goods, instead of issuing them on Exchequer Bills, such bills being themselves issued on that security.
'They reluctantly consented, and rescued us from a very embarrassing predicament.' The success of the Bank of England on this occasion was owing to its complete adoption of right principles.