Again, large sums of money are advanced upon stocks and shares, and this sometimes gives a fictitious value to those securities. When a sudden fall in prices takes place, the banker is liable to incur losses on these depreciated securities. The cry is raised during crises for more notes, but the trader does not want credit documents, but a sum of money placed to his credit, against which he can draw cheques.

Banking must always be conducted with prudence and caution if it is to progress in this country. A banker must never forget that he may be called upon at any moment to meet large demands.

Again, he ought always to have a good margin on goods against which money is advanced, so as to meet any possible contingency.

Loans should only be granted for short periods, because it is well known that even within a week there are sometimes great changes in trade and credit.

Another important point for the banker to remember is the difference between a marketable and an unmarketable security.

We know that Consols as an investment for banks are good, because the stock can be sold at a moment's notice, even in times of commercial crises. Thus during the Baring crisis large amounts were sold without affecting the price to any great extent.

Again, mortgages of property are not such a marketable security as produce - such as tea, coffee, or sugar, which can be readily sold in the market. It is also always worthy of notice that on the Stock Exchange there are some classes of securities which can easily be sold, whilst others cannot be realised sometimes for months. Again, other securities which are not quoted on the Stock Exchange should if possible be avoided.