are crowding in upon the private and joint-stock banks daily-only to remain locked up in their strong-rooms, or to be sent for greater security to swell the practically useless hoards lying in the Threadneedle Street cellars. For banking accommodation, in the ordinary sense of the term, there is no demand, and the business of the banking establishments is confined to the unprofitable custody of customers' deposits. For the legitimate and ordinary uses of trade there is scarcely any demand for money, and for speculative purposes literally none. A rate of discount ruling from 2 to 2 per cent. for first class securities, fails to attract applicants or to find a market; and co-existent with this extraordinary state of things in a mercantile community, we have Consols which pay 3 per cent. at par falling to 95, and scarcely any public demand; while the highest class railway and general securities are unsaleable at prices which will bring them up to a five or six per cent. investment.

Speculative enterprise for the present sleeps, and even the every-day operations of commerce are circumscribed within the narrowest limits. The legislative facilities granted during the last two or three sessions for encouraging the application of joint-stock capital to commercial undertakings, by reducing the individual liability of the adventurers to the amount fixed by themselves, have remained almost inoperative. They have not only altogether failed to give that impetus to wild and reckless speculation which those who objected to the innovation upon long established custom contended they would afford, but they have been nearly as ineffective in producing those beneficial results which their promoters imagined would result from them, both to shareholders and the public: Under the potent influence of a financial crisis, world-wide in extent, and the reactionary process which is still in progress, those powers from which so much was expected for good or for evil have lain dormant, and for some time to come are likely to continue so. The advertising columns of the daily journals are innocent of tempting announcements of brilliant projects, which, with infinitessimal risk, are to make the fortunes of all who engage in them; and though Parliament has before it rather a longer list of private bills than it has had to deal with for some few years past, they generally refer to schemes that involve no immediate or considerable outlay of capital, and which were for the most part resolved upon before the crisis set in. The fashionable season which commenced much earlier than usual, and under the circumstances most auspiciously with the marriage of the Princess Royal, has passed its zenith, and as regards trade has proved almost a failure. Down to the close of the month of March, the

receipts of the West End retail traders was scarcely adequate to defray their current expenses.

A long continuance of fine summer weather and the presence of the Court have no doubt since then brought some improvement in this respect; it is hardly to be hoped that that large class who depend upon "the season " will find the aggregate results equal to the accustomed average. When the retail trader has reason to complain of want of custom, the wholesale house and the manufacturer cannot long be in a state of active prosperity, and the absence of orders upon the manufacturer is instantly felt by the great body of the working-classes in the diminished demand for labour.

Probably there is no more accurate indicator of the pressure upon the working-classes than the falling off in the railway traffic returns, which is unquestionably one main cause of the depression now weighing upon the various descriptions of railway stocks. When the people are fully employed and money circulates freely amongst them, experience shows that they are ever ready to avail themselves of the facilities for cheap and speedy locomotion which are provided for them. And as diminished railway receipts marked the rise and progress of the existing difficulty, its cessation will be as certainly characterized by an improvement in the traffic returns and a restoration of the value of railway property.

But besides the natural reaction succeeding to the excitement of a financial panic resulting in a crisis, there are other causes which have contributed in a powerful degree to the existing state of commercial affairs, and which go far to explain the anomalous circumstances by which they are attended. Amongst those causes foreign politics stand prominently out. Scarcely had the crisis subsided when differences of a serious nature arose with the most powerful military nation of the world. In February, just as things were beginning to settle down, and when having passed through the trying ordeal to which the country had been subjected, we were beginning to look forward to the resumption of that state of healthy commercial action which is the normal condition of the British nation-circumstances, for which England was in no way responsible, arose suddenly and threatened to involve us in hostilities with our near neighbour and quondam ally the Emperor of France. As a natural consequence, trading operations were again suspended-capitalists feared to embark their money in speculative enterprises at the risk of their being interrupted by a war which, had it once broken out, it would have been impossible for any man living to foresee the end. This danger

had hardly passed away, when another arose, and, because of the democratic character of the Government opposed to us, and the apparent depth of the hostile feeling amongst all classes subject to that Government, at first sight a still more formidable one, on the other side of the Atlantic. The disputed question of the right of visit might at any moment, by the indiscretion of any British naval officer commanding a vessel of war on the American station, have plunged us into a war-which so late as a fortnight ago it seemed next to an impossibility to avoid-and a war which more than any other would have interfered with commercial pursuits and the operations of our mercantile marine. Then again, pari-passu with both these, there was the Indian difficulty not yet subdued, and the dispute with the King of Naples, which, though an insignificant matter in itself, assumed gigantic proportions when the powerful governments that, had extremities been resorted to, might and probably would have taken part in the contest, were brought into the account. These are all causes which, coming together or following upon each other in uninterrupted succession, as they have done, could not but exercise a serious influence to the prejudice of the trading interests of the country.

Happily all these difficulties and impediments are at an end. What the great and universally admitted diplomatic ability of Lord Palmerston and Lord Clarendon failed to accomplish, the singleness of purpose and determined, but at the same time conciliatory attitude assumed by the Foreign Office since the accession of Lord Malmesbury to the chief Secretaryship of that department have achieved. With the exception of the Indian rebellion, which may yet require many months of time and a vast expenditure of money entirely to suppress, all the embarrassments with which the political atmosphere was clouded when the present Government came into power have been cleared away, and so far as appearances enable us to form a judgment, our relations with all foreign powers are those of amity and friendship, and likely to continue so.

One circumstance, and one only, would probably tend to interfere with that brighter aspect of affairs which is beginning to dawn upon us, and that is the return of Lord Palmerston to power. Of that noble Lord's intimate knowledge of European politics in every phase and to the minutest detail, there can be no question; it is equally indisputable, that he possesses abilities of the highest order, and experience beyond any statesman of his time: but it is these very qualities combined with the extraordinary mas tery of the diplomatic science which the world gives him credit for, that occasion half the difficulties which when he rules the des

tinies of the nation or directs its foreign policy are sure to present themselves. Foreign governments regard him with distrust, and imagine that there is an arrière-pensée in everything he does; and it is the certainty they feel that in dealing with a man of less pretensions, like Lord Malmesbury, his demands are made with the settled determination to enforce them, and his concessions mean literally what they express, without any reservation, that constitutes the secret of that nobleman's success. Upon the consequences of that success there is now reason to believe that the country will soon have reason to congratulate itself. Public confidence is beginning to show signs of revival; an upward movement in the market for public securities has, apparently, set in; discounts are more inquired for; and, if no unexpected contre-temps intervene, we may hope ere long to see the vast amount of wealth which has since the beginning of the year been amassing, and which is still locked up useless and unproductive, released from its bonds, and profitably employed in restoring the trade of the country to its wonted activity, and promoting the welfare of all classes of the community.

CROSSED CHEQUES.

THIS important question being immediately to be brought before the House of Commons, the following very lucid exposition of the points in dispute will be read with great attention. The practical knowledge exhibited with the facts of the recent cases decided renders the statement worthy of the full consideration not only of the members of the legislature, but also of all those who are connected with the banking interest of the United Kingdom :—

"The practice of crossing cheques originated with the clerks at the London Clearing-house, who wrote the name of their bank across the cheques they collected or cleared, in order to their identification in case they should not be paid. The customers of the several bankers who were members of the clearing-house soon learned that any cheques drawn by them and paid into a clearing banker's hands need not be provided for until the close of the day; it thus became the practice of the drawers themselves to cross their cheques to ensure their passing through a banker. This was further found to be a great protection against the improper appropriation of cheques so crossed, as the holder could only obtain payment through the medium of a banker through whom the payment could be traced. In process of time this practice became a custom recognised in the courts, and thus obtained the force of law.

"In a well-known case, that of Bellamy v. Majoribanks, in which it was sought to recover from Coutts and Co. the amount of a cheque drawn upon them and paid to Gosling and Co., although especially

crossed to the Bank of England, Baron Parke, in giving judgment for the defendant, said, 'We see no legal objection to this custom, that of requiring a crossed cheque to be paid only to or through some banker, if thus limited and understood. It is, in our opinion, a reasonable and lawful practice and usage, in order to secure as far as possible payment of cheques to honest and bonâ fide holders. We feel strongly that to carry it further, and make the banker answerable to his customers for the appropriation by the payee of the proceeds of a crossed cheque received through a banker, would render the conduct of banking business very difficult, if not impracticable, and would cast a serious and probably mischievous impediment in the way of carrying on the money transactions of this country.' Although the custom well known and invariably acted upon by bankers is thus clearly recognised by the courts, the public do not appear to have been satisfied to bear their share of responsibility or the loss arising from dishonesty of servants in appropriating crossed cheques entrusted to their care, for in the case of Carlon v. Ireland, where the plaintiff, a solicitor, had given a cheque 'specially' crossed to his clerk, to pay into his banker's, and this clerk obtained the money from a tradesman to whom he was known, and who paid the cheque into the hands of his own bankers, by whom the amount was collected, the plaintiff sought to recover from the tradesman, or in other words to make another bear the loss arising from the default of the plaintiff's servant. This attempt was unsuccessful. Matters remained in this state until the passing of an act, introduced by Mr. Apsley Pellatt, 19th and 20th Vict., cap. 25, June 23, 1856, which enacted that

"In every case when a draft on any banker made payable to bearer or to order on demand, bears across its face an addition in written or stamped letters of the name of any banker, or of the words “and Company," in full or abbreviated, either of such additions shall have the force of a direction to the bankers upon whom such draft is made, that the same is to be paid only to or through some bankers, and the same shall be payable only to or through some banker.'

"This act is clear and explicit; but a case has recently arisen, known as Simmons v. Taylor, the facts of which are briefly as follow: Simmons drew a cheque on the London Joint-stock Bank, and crossed it with two transverse lines, and the words & Co.;' the cheque fell into dishonest hands, the lines and words & Co.' were carefully removed, and in that state the cheque was presented and paid. It was sought to make the banker liable for having so paid the cheque which had been crossed, although no vestige of such crossing appeared upon it. This attempt was unsuccessful, and has resulted in the introduction of the present bill, against which I submit the following objections:

"1. That the banker has at present cast upon him by law a very heavy responsibility, under which no ordinary vigilance or care will guard him from frequent losses. There are-1st. Forgery of endorsements on bills of exchange. In these cases the signatures of the endorsers cannot possibly, in one instance out of a thousand, be known