To my mind, a principal cause why these reiterated examinations and various researches have been so barren of result, is to be found in the way they have been conducted. They have been invariably the work of a secret committee. Various reasons, no doubt, have been assigned for this course; but amongst them there has not been one to show that secrecy is ever proposed, in or out of Parliament, unless when it happens to be greatly to the interest of some one party or person concerned, that something should be concealed: and the history of all secret committees goes to prove in a very clear manner that in nine cases out of every ten the interested party carries his point. One and all, as the Irish say, they are "cugger-mug-ger" committees.

In the first place, the Government has always been disposed to blame the Banks, and the Banks to blame the Government, and each with reason. Accordingly contending parties and rival interests necessarily became nicely balanced in the composition of the inquiring body. Such being the case, the leading movement is pre-arranged - all is fair to the eye, and as plausible as old Sin seducing inexperienced beauty. Evasion and deceit follow quickly after, and the bubble bursts in blank disappointment. Nor is it in the nature of things that the case should be otherwise. Some dozen gentlemen, or so, and many of them not the best informed upon the matter before them, are shut up in a room by themselves, with their minds filled with ideas of the importance and delicacy of the trust reposed in them. Afraid to commit themselves, or loth to do harm, the select body naturally falls into the hands of some subtle spirit - the old fox of the litter, who manoeuvres and manages just as suits his own views of policy and discretion. He has the art to begin by making the general tendency of the inquiry run in the direction of public opinion. A rumour of this gets abroad; the general anxiety is appeased; the people fancy they have got an honest committee; and abiding the issue in content, believe, good credulous creatures as they are, that for once all will end right. The old fox now has the field entirely to himself; it requires little of his practised art to prevent the examinations from being too searching, or the details from being too specific. His proceedings are concealed from observation; no publication takes place until the session has ended, and another opportunity of pushing the case home has been lost. Thus it is that inquiry drags its slow length along; and thus it generally takes one year to point out and rub up the omissions and perversions of the year before. Every stage in the progress of the inquiry is imperceptibly resisted, all points have to be formally invested, and one by one are only carried at last by besieging the committee, and battering it into extremities. Were the proceedings public - were the newspapers allowed to report the examinations - the strong good sense and quick intelligence of the community would be brought to bear upon the subject, and the heavy labour of many years would be easily done in a perfect manner in as many months.

There has been another capital omission in these proceedings. No man at all competent to answer the question can hesitate to define what Banking is; but these committees have neither affirmed the definition, nor informed us, except in a loose and very general way, when the Banks act up to it, and when they do not. Banking is a very simple thing, and it is most simple when best done: - it is the receiving of one man's money, who happens to have more than he wants, and the lending it out to another man, who, happening to have less than he wants, is willing, therefore, to pay interest for the loan. That interest is the Banker's profit; and the loan upon which it accrues cannot, I may add, by common usage and general consent, be made with propriety except on bills of exchange. In such a transaction, capital on the part of the Banker, or money of his own, does not appear to be required; it is nevertheless indispensable. The first man who has deposited his money may have occasion to draw it out before the bills of exchange, upon which it has been lent to the second man, fall due. In that event, and it is not an unfrequent one, the Banker falls back on his own capital, which, if he has foresight and understands his business, he will have invested in government or other public securities immediately convertible into ready money. Hence another rule in Banking - a prudent Banker will never swerve from one of two rules - he will either never discount with his capital, but with deposits only; or taking the converse of that, he will discount with capital and hold deposits in reserve. If he discounts with deposits and capital also, he must always be on the verge of ruin.

The way in which a Banker deals with his deposits is equally simple. Let us put a case: - Suppose the amount of money deposited in a Bank averages 100,000l.: the Banker will soon learn from experience, that a comparatively small portion of this sum, retained in his chest, will suffice to meet the current drafts of the depositors to whom it belongs. Every day some customers will diminish the amount to their credit, by drawing checks against it; while others will add to their balances, by paying in more cash. The difference consequently between the total sums drawn out, and the total sums paid in during the day, is the amount the Banker will have to produce on his counter. It has been computed that in ordinary times, one-tenth, and occasionally even so little as one-twentieth part of the whole deposits lodged, will be enough for a Banker to keep by him. It follows accordingly, that of 100,000l. deposits, 10,000l. will be retained in specie, to meet the day's current demands, and the remaining 90,000l. will be invested in stock, Exchequer Bills, etc.; or in discounting good mercantile bills, the interest on which will constitute the legitimate profits of the business thus conducted.