It was, after all the smoke and mirrors, Carney. ‘He is quite simply the best, most experienced and most qualified person in the world to do the job,’ explained the chancellor about the Canadian, who had accepted the position for a five-year term only and would be the first foreigner to become governor. Press reaction was almost unanimously positive. ‘A resounding statement that Britain is ready to hire the best talent for top posts’ (Financial Times); ‘ticks virtually all the boxes’ (Times); ‘as an outsider with fresh ideas, he will be perfectly placed to spur open debate and new thinking’ (Daily Telegraph). Some seven months later, 30 June 2013, a Sunday, was King’s last day, coinciding with the Bank’s annual sports day at Roehampton. Cricket that afternoon featured a recent England captain, Andrew Strauss, and an over or two of the governor’s teasing slows. Next morning, coming in by tube from west London, the new man was at Bank Station shortly before seven o’clock. Unlike Montagu Norman, he did not have a hat – let alone in the electronic age a ticket attached to it. An understandable topographical struggle ensued about which exit to take, but soon enough the 119th person to be governor had his feet under the table.44
The Bank over the previous 319 years had had its share of criticism, but also its share of praise. The greatest of writers on the Bank usually dished out the former, but occasionally the latter. ‘Nothing would persuade the English people,’ declared Walter Bagehot in Lombard Street, ‘to abolish the Bank of England; and if some calamity swept it away, generations must elapse before at all the same trust would be placed in any other equivalent.’ While still deputy governor, King quoted those words at the August 1999 gathering of central bankers at Jackson Hole, Wyoming. And he went on with words of his own that any governor in any era might usefully have pondered:
Central banks may be at the peak of their power. There may well be fewer central banks in the future, and their extinction cannot be ruled out. Societies have managed without central banks in the past. They may well do so again in the future. The website of my favourite football team [Aston Villa] has the banner ‘heroes and villains’. For some, central bankers are heroes – more powerful and responsible than political leaders – and for others they are villains – too fanatical to be entrusted with the world economy. For all our sakes, it is important that central bankers are seen neither as heroes nor villains. They should be modest technicians, striving to improve the way they use the tools of their trade, and always eager to learn. Openness of mind and fleetness of foot will be the best way to avoid extinction.45
Notes
ABBREVIATIONS
Unless otherwise stated, all archival references are to the Bank of England Archive.
Abramson
Daniel M. Abramson, Building the Bank of England: Money, Architecture, Society, 1694–1942 (New Haven, 2006)
Acres
W. Marston Acres, The Bank of England from Within (2 vols, 1931)
BEQB
Bank of England Quarterly Bulletin
Boyle
Andrew Boyle, Montagu Norman (1967)
Byatt
Derrick Byatt, Promises to Pay: The First Three Hundred Years of Bank of England Notes (1994)
Capie
Forrest Capie, The Bank of England: 1950s to 1979 (New York, 2010)
CB
Central Banking
Clapham
Sir John Clapham, The Bank of England: A History (2 vols, Cambridge, 1944)
Clay
Sir Henry Clay, Lord Norman (1957)
Conaghan
Dan Conaghan, The Bank: Inside the Bank of England (2012)
DBB
Dictionary of Business Biography
de Fraine
H. G. de Fraine, Servant of This House: Life in the old Bank of England (1960)
Dow
Graham Hacche and Christopher Taylor (eds), Inside the Bank of England: Memoirs of Christopher Dow, Chief Economist, 1973–84 (Basingstoke, 2013)
Fay
Stephen Fay, Portrait of an Old Lady: Turmoil at the Bank of England (1987)
Feavearyear
Sir Albert Feavearyear, The Pound Sterling (2nd edn, 1963)
Fed
Archives of Federal Reserve Bank of New York
Fforde
John Fforde, The Bank of England and Public Policy, 1941–1958 (Cambridge, 1992)
FT
Financial Times
Giuseppi
John Giuseppi, The Bank of England: A History from its Foundation in 1694 (1966)
Hennessy
Elizabeth Hennessy, A Domestic History of the Bank of England, 1930–1960 (Cambridge, 1992)
Hewitt and Keyworth
V. H. Hewitt and J. M. Keyworth, As Good as Gold: 300 Years of British Bank Note Design (1987)
King
W. T. C. King, History of the London Discount Market (1936)
King (1)
The Cecil King Diary, 1965–1970 (1972)
King (2)
The Cecil King Diary, 1970–1974 (1975)
Kynaston
David Kynaston, The City of London (4 vols, 1994–2001)
LMA
London Metropolitan Archives
Morgan
E. Victor Morgan, The Theory and Practice of Central Banking, 1797–1913 (Cambridge, 1943)
NA
National Archives
O’Brien
Leslie O’Brien, A Life Worth Living (privately published, 1995)
ODNB
Oxford Dictionary of National Biography
OHC
Oral History Collection (at Bank of England Archives)
OL
Old Lady
Roberts and Kynaston
Richard Roberts and David Kynaston (eds), The Bank of England: Money, Power and Influence, 1694–1994 (Oxford, 1995)
Sayers
R. S. Sayers, The Bank of England, 1891–1944 (2 vols, plus appendixes, Cambridge, 1976)
Unless otherwise stated, all books are published in London.
PROLOGUE: IT MUST NOW NECESSARILY BE A BANK
1 T. A. Stephens, A Contribution to the Bibliography of the Bank of England (1979), p 86; M1/1; E. S. de Beer (ed), The Correspondence of John Locke, Volume Five (Oxford, 1979), p 81; Bruce G. Carruthers, City of Capital (Princeton, New Jersey, 1996), p 246; Acres, vol 1, pp 12–13; M1/1.
2 ODNB, David Armitage, ‘Paterson, William (1658–1719)’; William Paterson, A Brief Account of the Intended Bank of England (1694), p 1; ODNB, Stuart Handley, ‘Montagu, Charles, Earl of Halifax’, ‘Godfrey, Michael’; James E. Thorold Rogers, The First Nine Years of the Bank of England (Oxford, 1887), pp 9–12; P. G. M. Dickson, The Financial Revolution in England (Aldershot, 1993 edn), p 54.
3 London Gazette, 5 July 1694; Acres, p 14; M1/1; ADM30/15; G4/1, 27 July 1694; Byatt, p 11.
4 Clapham, vol 1, p 1; Dickson, p 47; Felix Martin, Money (2013), p 116; Anne L. Murphy, ‘Demanding “credible commitment”’, Economic History Review, Feb 2013, p 178; Larry Neal, ‘How it all began’, Financial History Review, Oct 2000, pp 123–4; Steve Pincus, 1688 (New Haven, 2009), pp 277, 484, 368.
5 Anne L. Murphy, The Origins of Financial Markets (Cambridge, 2009); Larry Neal and Stephen Quinn, ‘Networks of information, markets, and institutions in the rise of London as a financial centre, 1660–1720’, Financial History Review, April 2001, pp 7–14; J. Lawrence Broz and Richard S. Grossman, ‘Paying for privilege’, Explorations in Economic History, 2004, pp 50, 56–7; Michael Collins and Mae Baker, ‘Bank of England Autonomy’, in Carl-L. Holtfrerich et al (eds), The Emergence of Modern Central Banking from 1918 to the Present (Aldershot, 1999), p 23.
6 Martin, p 119. More generally, for a stimulating treatment of the Bank’s beginnings and early history, bringing out the high degree of provisionality and improvisation as well as putting the Bank in a larger social and literary context, see: Valerie Hamilton and Martin Parker, Daniel Defoe and the Bank of England (Winchester, 2016).
7 J. A. Giuseppi, ‘Sephardi Jews and the early ye
ars of the Bank of England’, in Jewish Historical Society of England, Transactions: Sessions 1955–59 (1960), pp 56–7; Dickson, pp 254–8; Murphy, Origins, pp 148–52.
8 J. Alan Downie, ‘Gulliver’s Travels, the Contemporary Debate on the Financial Revolution, and the Bourgeois Public Spheres’, in Charles Ivar McGrath and Chris Fauske (eds), Money, Power and Print (Cranbury, New Jersey, 2008), p 125; Feavearyear, p 125.
9 W. Marston Acres, ‘Directors of the Bank of England’, Notes and Queries, 20 July 1940; Pedro de Brito, ‘The Portugal Merchants as Founders of the Bank of England in 1694’, in British Historical Society of Portugal, Annual Report and Review 2008, pp 72–4; F. M. Crouzet, ‘Walloons, Huguenots and the Bank of England’, Proceedings of the Huguenot Society of Great Britain & Ireland, Summer 1990, pp 167–9; Murphy, Origins, p 81; Gary Stuart de Krey, A Fractured Society (Oxford, 1985), pp 109–10, 151, 154.
10 de Krey, p 146; ODNB, Gary S. de Krey, ‘Abney, Sir Thomas’, Jacob M. Price, ‘Heathcote Gilbert, first baronet’; de Brito, p 75; ODNB, H. G. Roseveare, ‘Houblon, Sir John’; Crouzet, p 168; OL, March 1935, p 8; Claire Tomalin, Samuel Pepys (2002), pp 291–2; OL, Dec 1922, pp 292–3; Donald F. Bond (ed.), The Spectator, Volume 1 (1965), pp 10–11.
CHAPTER 1: SERVICES TO THE NATION
1 Hewitt and Keyworth, pp 21–2; Giuseppi, p 19; Henry Roseveare, The Financial Revolution, 1660–1760 (Harlow, 1991), p 37; Clapham, vol 1, p 22; Nicholas Lane, ‘The Foundation of the Bank of England’, History Today, Oct 1957, p 689; James E. Thorold Rogers, The First Nine Years of the Bank of England (Oxford, 1887), pp 25–6; OL, Dec 1965, p 203; Abramson, p 9.
2 H. P. R. Hoare, Hoare’s Bank (1955 edn), opp p 27; Hewitt and Keyworth, p 24; Anne L. Murphy, The Origins of English Financial Markets (Cambridge, 2009), p 82; E. S. de Beer (ed), The Correspondence of John Locke, Volume Five (Oxford, 1979), pp 271–2; Bruce G. Carruthers, City of Capital (Princeton, New Jersey, 1996), p 141; Michael Godfrey, A Short Account of the Bank of England (Pulborough, 1999, Dragonwheel edn), pp 10, 15, 19.
3 D. W. Jones, War and Economy (Oxford, 1988), p 14; Andrew Forrester, The Man Who Sold the Future (New York, 2004), pp 75–7; G7/1, 16 May 1695; ADM30/6, Godfrey Family file; Acres, vol 1, p 54.
4 OL, March 2005 (Anne L. Murphy), p 17; Victoria Hutchings, Messrs Hoare Bankers (2005), p 28; Acres, vol 1, p 68; G7/1, 13 May 1696.
5 Dennis Rubini, ‘Politics and the Battle for the Banks, 1688–1697’, English Historical Review, Oct 1970, pp 702–3; Locke, p 540; Acres, vol 1, p 63; Carruthers, pp 141–2; G7/1, 29 April 1696; John Francis, History of the Bank of England, its Times and Traditions (1848), vol 1, p 69.
6 Acres, vol 1, p 71; Jones, p 24; Clapham, vol 1, pp 40–1; Acres, vol 1, pp 61, 73; Elisa Newby, ‘Macroeconomic Implications of Gold Reserve Policy of the Bank of England during the Eighteenth Century’ (Centre for Dynamic Macroeconomic Analysis, University of St Andrews, 2007), p 12; Acres, vol 1, p 73; Henry Horwitz, Parliament, Policy and Politics in the Reign of William III (Manchester, 1977), p 188; Locke, p 731; Lady Alice Archer Houblon, The Houblon Family (1907), vol 1, pp 281–2; Horwitz, p 188.
7 OL, March 2005 (Anne L. Murphy), p 17; Anne L. Murphy, ‘Demanding “credible commitment”’, Economic History Review, Feb 2013, p 193; Acres, vol 1, pp 79–80; Murphy, Origins, pp 152–4; Acres, vol 1, p 81; G7/1, 16 July 1697.
8 David Scott, Leviathan (2013), p 253; H. V. Bowen, ‘The Bank of England during the Long Eighteenth Century, 1694–1820’, in Roberts and Kynaston, pp 5, 10; P. G. M. Dickson, The Financial Revolution in England (1967), p 373; Andrew S. Skinner (ed), Sir James Stuart, An Inquiry into the Principles of Political Oeconomy (Edinburgh, 1966), Volume Two, p 618; Acres, vol 1, pp 98–9; ADM30/15, Houblon Family file; Acres, vol 1, pp 99–102; T. A. Stephens, A Contribution to the Bibliography of the Bank of England (1897), p 15; D. W. Jones, ‘London merchants and the crisis of the 1690s’, in Peter Clark and Paul Slack (eds), Crisis and Order in English Towns, 1500–1700 (1972), p 340. For a full treatment of the Bank and Exchequer bills during the War of the Spanish Succession, see: Richard A. Kleer, ‘“A new Species of Mony”’, Financial History Review, Aug 2015, pp 179–203.
9 Abramson, p 11; Gary Stuart de Krey, A Fractured Society (Oxford, 1985), pp 143, 231; Giuseppi, p 34; Anne L. Murphy, ‘Learning the business of banking’, Business History, Feb 2010, pp 154–6, 168; OL, June 1928, pp 272–3; Acres, vol 1, pp 144, 151; Murphy, ‘Learning’, pp 161–2; OL, June 1928, pp 271–2.
10 Abramson, p 6; Clapham, vol 1, pp 151, 292; Bowen, p 15; Larry Neal and Stephen Quinn, ‘Networks of information’, Financial History Review, April 2001, p 25; Douglass C. North and Barry R. Weingast, ‘Constitutions and Commitment’, Journal of Economic History, Dec 1989, p 821; Murphy, ‘Demanding’, p 183.
11 B. W. Hill, ‘The Change of Government and the “Loss of the City”, 1710–1711’, Economic History Review, Aug 1971, pp 398–9; Geoffrey Holmes, ‘The Sacheverell Riots’, Past and Present, Aug 1976, p 66; Hill, pp 400–4.
12 De Krey, pp 223–8; Carruthers, pp 143, 247–8; Hill, pp 407–8; Clapham, vol 1, pp 75–6; James Macdonald, ‘The importance of not defaulting’, in D’Maris Coffman et al (eds), Questioning Credible Commitment (Cambridge, 2013), p 130; Hill, pp 408–11.
13 Acres, vol 1, pp 107–10; Dickson, pp 81–2; Clapham, vol 1, pp 81–3.
14 Richard Kleer, ‘“The folly of particulars”’, Financial History Review, Aug 2012, pp 175, 183–5; John Carswell, The South Sea Bubble (Stroud, 1993 edn), p 76.
15 Richard Dale, The First Crash (Princeton, New Jersey, 2004), p 92; Carswell, pp 92–4; Dickson, p 100; Carswell, p 94; Julian Hoppit, A Land of Liberty? (Oxford, 2000), p 335; Kleer, pp 186–8; Clapham, vol 1, p 84; Dickson, pp 145, 192–3; Carswell, p 135.
16 Hoppit, p 335; Dickson, p 139; Hoppit, p 335; Jenny Uglow, Hogarth (1997), p 89; Dickson, p 139; Carswell, pp 150–1; Kleer, p 185; Dickson, pp 165–6; Carswell, pp 164, 168; 11A/107/1, 12 Oct 1720; Giuseppi, p 48.
17 Carswell, pp 169–70; Dickson, pp 179–80, 380; Larry Neal, ‘How it all began’, Financial History Review, Oct 2000, p 128; 10A/61/6, fo 497; Giuseppi, p 45.
18 Daniel Defoe, A Tour Thro’ the Whole Island of Great Britain (1927 edn), vol 1, p 342; Dickson, p 378; Clapham, vol 1, p 92; Acres, vol 1, p 162; Julia Rudolph, ‘Jurisdictional controversy and the credibility of common law’, in Coffman, Questioning, p 106; Paul Langford, A Polite and Commercial People (Oxford, 1989), p 179; Clapham, vol 1, pp 230–1; 11A/107/2, 19 Aug 1731; Ann M. Carlos and Larry Neal, ‘The Micro-Foundations of the Early London Capital Market’, Economic History Review, Aug 2006, pp 498, 500; Dickson, pp 276, 279–80; Norman Hunt, ‘The Russia Company and the Bank of England’, Listener, 3 Nov 1960; OL, June 2006, p 52 (Kenneth J. Cozens).
19 Acres, vol 1, pp 152–3; OL, Spring 1991, p 21 (Derrick Byatt), June 1933, pp 95–8 (W. Marston Acres); Acres, vol 1, pp 123–4; Hewitt and Keyworth, p 26; Acres, vol 1, pp 158–9, 153–4; 11A/107/2, 25 Sept 1728; OL, Sept 1937, pp 216–18 (Acres).
20 Abramson, pp 29–32, 48–9; Acres, vol 1, p 130.
CHAPTER 2: A GREAT ENGINE OF STATE
1 Clapham, vol 1, p 232; Cobbett’s Parliamentary History of England, Vol X (1812), col 62; Historical Manuscripts Commission, Manuscripts of the Earl of Egmont: Diary of the First Earl of Egmont (Viscount Percival), Vol II (1923), pp 380–1; Historical Manuscripts Commission, The Manuscripts of the Earl of Carlisle (1897), pp 182–3; Egmont, p 396.
2 G4/17, 5 March 1742; R. D. Richards, ‘The First Fifty Years of the Bank of England’, in J. G. van Dillen (ed), History of the Principal Public Banks (The Hague, 1934), pp 216–17; P. G. M. Dickson, The Financial Revolution in England (1967), p 217.
3 Gentleman’s Magazine, Sept 1745, p 500; G4/17, 26 Sept 1745; Gentleman’s Magazine, Sept 1745, pp 499–500; Acres, vol 1, p 181.
4 E. L. Hargreaves, The National Debt (1930), pp 52–3; G7/3, 31 Jan 1750; Old England, 3 Feb 1750; L. S. Sutherland, ‘Samson Gideon and the Reduction on Interest, 1749–
50’, Economic History Review, Feb 1946, p 27; General Advertiser, 19 Feb 1750; G7/3, 27 Feb 1750; General Advertiser, 28 Feb 1750; Dickson, p 236; Acres, vol 1, p 184; Dickson, pp 322–3. In general, the two key accounts of Pelham’s scheme and how it played out are those by Sutherland and Dickson.
5 J. A. S. L. Leighton-Boyce, Smiths the Bankers, 1658–1958 (1958), p 75; Giuseppi, p 56; Acres, vol 1, p 186; Julian Hoppit, ‘Financial Crises in Eighteenth-Century England’, Economic History Review, Feb 1986, pp 49–50; Michael C. Lovell, ‘The Role of the Bank of England as Lender of Last Resort in the Crises of the Eighteenth Century’, Explorations in Entrepreneurial History, Oct 1957, pp 9–17.
6 Abramson, p 60; Joseph A. Schumpeter, History of Economic Analysis (1954), p 696; A. Anderson, An Historical and Chronological Deduction of the Origin of Commerce (1764), vol II, p 375.
7 Clapham, vol 1, pp 102–3; J. E. D. Binney, British Public Finance and Administration, 1774–92 (1958), pp 97–100; Abramson, p 70; Anne L. Murphy, ‘Making the Market: Trading Debt at the Eighteenth-Century Bank of England’, European Association for Banking and Financial History (EABH) Papers, 2014, pp 16–17, 30.
8 Dickson, pp 382–8; Clapham, vol 1, pp 70–1, 174.
9 Elisa Newby, ‘Macroeconomic Implications of Gold Reserve Policy of the Bank of England during the Eighteenth Century’, Centre for Dynamic Macroeconomic Analysis working paper, University of St Andrews, Feb 2007.
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