238 THE CURRENCY REPORT

of the country from the losses sustained during the
war/' With these weighty words the Committee
brushes aside a host of schemes that have been urged
for putting everything right by devising new
machinery for the manufacture of new credit. That
new credits will be needed for industry after war is
obvious, but what else are our banks for, if not to
provide it ? They can only be set free to provide it
on the scale required if, by the necessary reduction
of the floating debt, they are relieved of the locking
up of their funds in Government securities, which has
been one of the bad results of our bad war finance.

It goes without saying that the Committee does
not recommend the continuance in peace of the
differential rates for home and foreign money that
were introduced as a war measure with a view to
lowering a rate at which the Government borrowed
at home for war purposes. It would evidently be
too severe a strain on human nature to attempt to
work such a system, except in war-time, when the
artificial conditions by which the market was sur-
rounded made it both feasible and desirable to do so.
With regard to the note issue, the Committee pro-
poses a return to the old system and a strictly drawn
line for the amount of the fiduciary note issue, the
whole note issue (with the exception of the few
surviving" private note issues) being put into the
hands of the Bank of England, all notes being payable
in gold in London only and being made legal tender
throughout the United Kingdom. These sugges-
tions are subject to any special arrangements that
may be made with regard to Scotland and Ireland,