The Principles of Economical Philosophy Volume 2

The Principles Of Economical Philosophypresents a polemical historical-analytical critique of money, banking, and currency policy in 19th?century England. It argues that money is a transferable debt and that attempts to fix currency by simple quantity rules (the Currency Principle) are misguided; instead, currency should be controlled through the rate of discount, guided by foreign exchanges and bullion, not by fixed caps on notes. The work surveys the nature of currency as credit, tracing how various payment instruments—money, banknotes, deposits, and negotiable bills—interact with velocity to shape the monetary supply. It analyzes the Bank of England and the Bank Charter Act of 1844, arguing that the Act’s division of issuance and banking functions and its presumed gold par balance are false premises, and that crises demonstrate a preference for credit expansion over rigid restriction. The author advocates a unified, rights?based theory of wealth, emphasizes credit turnover and systemic banking reform, and grounds policy in extensive historical evidence rather than isolated cases.