TEE BILL ON LONDON

Dominion, Volume 8, Issue 2321, 1 December 1914, Page 4

TEE BILL ON LONDON

Me. Lloyd George, Chancellor of the Exchequer, speaking in the House of Commons with respect to the financial measures of the Government 6aid: "At the beginning of the war this country could neither buy nor sell, because exchange had broken down, though the whole world owed "us money.' . America owed us £1,000,000,000. ;With £18,000,000,000 pf assets, it would have been crim-inal-negligence to allow the credit of the country to be in doubt foi' twenty-four hours for the sako of £350,000,000, the most of which was owing to our own people.' Wo decided that' tho credit of the State must bo maintained at any cost. Thus the unimpeachable' character of the British bill of exchange has been maintained, and the greatest financial catastrophe the world could ever | have seen was averted. The total loss of these bill transactions was about what it costs us for a single week of the war." One' of the first acts of the British Government when war was declared was to authorise the Bank of England to discount foreign bills on London in existence prior to August 4. and . which would in normal times have been discounted, and the Bank was' guaranteed against loss, and that loss, according to Mr. Lloyd George, totals about £12,000,000. This appears a huge sum, but it is a cheap price to pay for the maintenance of British cijedit. The bill on London is the currency of the world. It is tho only currency of the world. It represents gold; but/ it is better than gold, and is preferred to gold because transmissible with greater rapidity, greater. _ ease, greater certainty, and infinitely less risk of loss. It has,: therefore, become the universal world currency which, and which alone, the producers and handlers of all nations will accept as wholly satisfactory and sufficient. Thero is nothing like it elsewhere. No such function is performed by a bill on Paris, on Berlin, or on New York. This is London's finanoial supremacy, and one material cause of it is that London is a free market for gold, and another factor no less important is the honesty, skill, and caution of British merchants and bankers, as well as the unsullied integrity of British justice. ,The bills on London total a vast sum : each year, s the figures for 1912 being £1,805,000,000.