THE WEALTH OF NATIONS.

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for answering occasional demands, tliis bank is obliged tokeep at all times in its coffers ten thousand pounds in goldand silver. Should this bank attempt to circulate forty-fourthousand pounds, the four thousand pounds which are overand above what the circulation can easily absorb and employ,will return upon it almost as fast as they are issued. Foranswering occasional demands, therefore, this bank ought tokeep at all times in its coders, not eleven thousand poundsonly, but fourteen thousand pounds. It will thus gain nothingby the interest of the four thousand pounds excessive circu-lation; and it will lose the whole expense of continually col-lecting four thousand pounds in gold and silver, which willbe continually going out of its coffers as fast as they arebrought into them.

Had every particular banking company always understoodand attended to its own particular interest, the circulationnever could have been overstocked with paper money. Butevery particular banking company has not always understoodor attended to its own particular interest, and the circulationhas frequently been overstocked with paper money.

By issuing too great a quantity of paper, of which the ex-cess was continually returning, in order to be exchanged forgold and silver, the bank of England was for many years to-gether obliged to coin gold to the extent of between eighthundred thousand pounds and a ngullion a year; or, at anaverage, about eight hundred and fifty thousand pounds.For this great coinage the bank (in consequence of the wornand degraded state into which the gold coin had fallen a fewyears ago) was frequently obliged to purchase gold bullionat the high price of four pounds an ounce, which it soon afterissued in coin at 61 . 17,s\ I O^d. an ounce, losing in this mannerbetween two and a half and three per cent, upon the coinageof so very large a sum. Though the bank therefore paid noseignorage, though the government was properly at the ex-pense of the coinage, this liberality of government did notprevent altogether the expense of the bank.

The Scotch banks, in consequence of an excess of the samekind, were all obliged to employ constantly agents at London to collect money for them, at an expense which was seldombelow one and a half or two per cent. This money was sentdown by the waggon, and insured by the carriers at an addi-tional expense of three quarters per cent, or fifteen shillingson the hundred pounds. Those agents were not always able