work, with results more or less disastrous to the community. But of all this I do not propose to treat: the present inquiry is confined to our coinage as it actually exists, and to that portion of it only which is, or should be, a standard coinage, that is to say our gold, not to that which is a token coinage only, as is our silver and copper: we have to investigate what our gold coins are in theory, and what, (it is by no means the same thing), they are in practice: in short, for the title of this paper we might not inappropriately substitute Sir Robert Peel's famous question, "What is a Pound?"

PART I.-The Theoretical condition of the Gold coinage.

The difficulty of handling the subject is extreme, because on the one hand it is very simple to state what a sovereign is by law; this is clearly laid down by a very recent Act of Parliament, whose provisions are fully satisfied by the admirable delicacy of the machinery of the Mint but on the other hand there are few questions that so successfully elude statistical inquiry as the practical condition of our gold currency, and few that have so much exercised the ingenuity of thoughtful experts. Previous writers have said almost all that can be said on the subject, Professor Jevons has made it particularly his own, and has exhausted every form of research that could be applied to it, and the present paper must therefore be taken as to some extent a plagiarism, under full acknowledgment of obligation to the work of others, and with but little claim to original or independent thought.

The establishment of our gold coinage on its present basis is mainly due to Lord Liverpool, whose famous "Letter to the King" is a standard work on the subject of metallic currency; by the Act of 56 Geo. III., cap. 68, the present weight of the sovereign and halfsovereign was determined, and since the 1st of July, 1817, the coinage of guineas has been discontinued. Before dismissing the latter venerable coin, which enjoyed a currency (1673-1817) of 144 years, and whose traditions still linger with us, nay even have a certain vitality in matters of account, we may permit ourselves to compare it with the coin that has displaced it. Both were of the same fineness, viz., 22 carats pure gold, and carats copper alloy, or, as expressed in millesimal fineness 916-66, while the actual weights compare thus:

24

It may be convenient to remember that a grain of pure gold is worth a little more, while a grain of standard gold is worth a little less than 2d., and when we are reading of the currency troubles of past times, and find that the guinea passed current as the equivalent of amounts varying from 20s. to 30s. we should bear in mind that this is an expression of its value in terms of silver, but that in terms of standard gold it was always worth 218., i.e., twenty guineas of lawful weight were always equivalent to twenty-one of our standard sovereigns.

It is unnecessary to enlarge here, where time and space are alike valuable, on the conditions under which gold is bought and sold by the Bank of England and the Mint, or on the processes (twelve in number) which a mass of bullion must pass through at the Mint before being converted into a gold coin of the realm; such information can be found abundantly elsewhere, and may be supplemented most advantageously to all concerned in the inquiry, by a personal visit to the Mint; it will suffice to point out that the utmost deliacy of manipulation in preparing the metal, and of machinery in striking the coin, cannot ensure absolute perfection or uniformity, and that a "remedy" or variation, both as to weight and fineness, has perforce to be allowed. In the case of a sovereign the remedy of weight is gr. (= 0·2) in the case of a half-sovereign it is gr. (01) while the remedy of fineness is gr. Too (= 0.002) We may express this tabularly as follows:

=

whence we see that the heaviest sovereign which the Mint may lawfully issue can suffer by abrasion a loss of nearly a grain, (-974) 2d., while the lightest sovereign that can lawfully be issued can only endure a loss in weight of gr. 0.574, or a little more than 1d., without becoming light. We also find that the halfsovereign at its least legal tender weight is less than one-half of the sovereign in similar plight by one-eighth of a grain. The general public has to take the fineness of the sovereign on trust, but we see from the above Table that the finest possible sovereign

that the Mint can issue may contain 10 parts more pure gold -i.e., may be more valuable by a little more than 1d-than a Sovereign containing the utmost quantity of alloy that the Mint authorities may put into it. These quantities appear minute, yet the necessity of the utmost nicety is apparent, when we find that the difference between one million sovereigns, all of the least permissible weight, and a million sovereigns of the greatest permissible weight, would be £3,244; while in the matter of fineness, the difference between a million sovereigns, all of the lowest permissible composition, and a million of the highest permissible composition amounts to as much as £4,363. So that, in the coinage of one million sovereigns the allowed variations of weight and fineness amount altogether to £7,607. It may also be mentioned, in order to convey an idea of the delicacy required in order to achieve this result, that a variation of of an inch in the thickness (1388) of the "fillet," or band of metal from which the half-sovereign is punched, would throw the coin struck from it "out of remedy."

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The quality of the work turned out by the Royal Mint is certified by the Jury of the Pyx, a body of "not less than six out of competent freemen of the mystery of Goldsmiths of the city of London," whose duty it is to test samples of the year's coinage, and to report on its weight and fineness; the exact modus operandi will be best explained by appending to this paper a copy of their verdict for 1880, as well as of the Coinage Act of 1870.

Under the conditions thus briefly sketched, the London Mint has supplied the wants of the nation during the years 1817-1880 with sovereigns and half-sovereigns of the total value of two hundred and forty-six millions sterling, an amount supplemented by issues from the Sydney Mint since 1855 of forty-five millions, and by issues from the Melbourne Mint, since 1872, of sixteen millions-in all, three hundred and eight millions sterling. The exact amount annually coined at each of the above Mints will be found in Table I., appended to this paper, and is condensed into the following table, showing the totals of decennial periods. The amount of coinage executed varies so much from year to year owing to a variety of causes that this summary will, perhaps, have advantages over a more detailed statement, especially as each cycle of ten years happens to embrace one of those commercial crises whose periodicity has exercised the ingenuity of some of our most careful inquirers into final causes. We see here the activity of the Mint in the years 1817-30 (averaging an out-turn of about 3.3 million per annum) followed by a singular contraction to 1.3 million for 1831-40; as well as the

For full historical account of the Trial of the Pyx, and details of its action, see "Report to Comptroller-General of the Exchequer," &c., May, 1866. No. 293.

enormous impetus given to gold coinage by the gold discoveries in Australia, owing to which our gold coinage was increased in 1851-70 to the rate of 6.75 millions per annum.

Part II.-The actual condition of the gold coinage.

Having thus briefly stated the conditions under which our gold coinage is put into circulation, we have now to consider the far less easily ascertained question, how nearly does the gold coin actually in circulation conform to the requirements of the law? We have seen that the sovereign should be a piece of metal weighing 123 grains, and containing of pure gold. How far do the Sovereigns which we use in every-day life fulfil these conditions? The sovereign emerges (as Minerva sprang fully armed from the head of Jupiter), in full perfection from the Mint; unfortunately it lacks the immortality of the goddess. We are wont to speak of the life of a coin, but whereas the term "life" is in all other cases associated with the idea of a period of growth, of maturity and of decay, in this instance the process is one of degradation only.

The life of a sovereign, like that of man, is threatened by perils from two sources, violence or accident on the one hand, natural decay on the other. The perils of the first class are obvious, and may be briefly dismissed; a coin may be totally lost, as in a fire or a shipwreck, or it may be fraudulently tampered with, either by the mechanical process vulgarly known as "sweating", or by the more subtle agency of chemical art. As long as gold is in use, its total loss must occasionally take place; it is to be feared that dishonest ingenuity will be hardly less persistent in its attacks. The loss which our gold coinage suffers by fraud, is however probably

but small as compared with its total volume, yet, in any attempt to reform the present condition of our gold coinage, the necessity of guarding against dishonest tampering must not be left out of

account.

It is with the subject of the natural decay of our coinage, that the present paper proposes mainly to deal; the field of inquiry cannot indeed be said to be an unworked one, for the defective condition of our gold coin has long been notorious to us Bankers, as practically concerned therewith, and has been reported on more than once by Parliamentary Committees. The report of the Royal Commission on International coinage, 1868, received evidence on this subject, and reported* (p. xii.). "It is, we believe, undeniable that a very large portion of the gold coins circulating in this country, is already below the current weight, or very nearly so, and a gradual re-coinage will soon become a matter of necessity under any circumstances." This report receives ample confirmation from that of the select committee on London City Lands (Thames Embankment) Bill, 1881, a committee appointed to take evidence on the question of the removal of the Mint from its present site, and the subject is touched on, but to a slighter degree, in the evidence given before the select committee on Banks of Issue, 1875.

From the authorities already cited, ample materials might have been drawn by judicious editing, for a paper on the subject before us, but it appeared to me to be more respectful to this Society, as well as far more satisfactory to myself, not to serve up a mere réchauffé of what was already on record, but to attempt at least some independent investigation; and if in explaining the measures which were taken, the personal pronoun should appear too obtrusive, I hope that you will set this down not to egotism and a wish to obtain credit for my own efforts, but to the fact that you will be thus most directly enabled to judge as to the sufficiency and impartiality of the evidence that has been taken, and consequently as to the weight and importance that should fairly attach to it.

By the kind assistance of Professor Jevons and Mr. Chubb, I drew out a scoring sheet on which might be tabulated the dates of issue borne on 100 sovereigns and 100 half-sovereigns respectively, with a second table for recording the number found heavy and light respectively, and a third for the purpose of specifying the weight

This report bears the following signatures:

Halifax.

C. P. Villiers.

Stephen Cave.

J. Wilson Patten.

M. Longfield.

John Lubbock.

Thomas Baring.

L. N. de Rothschild.
John Benjamin Smith.
Thomson Hankey.
John G. Hubbard.
Thomas N. Hunt.

G. B. Airy.
Thomas Graham.