Meaning: The quote you have provided touches upon a significant aspect of monetary systems, particularly in relation to the supply of gold and its impact on the stability of currency. The quote suggests that when the supply of gold diminishes, the security behind banknotes is weakened, leading to restrictions or suspensions in the lending of these notes, which in turn can trigger panic and turmoil within the financial system.

Historically, the value of currency has often been tied to the availability of gold reserves. This system, known as the gold standard, was prevalent in many countries during the 19th and early 20th centuries. Under the gold standard, the value of a country's currency was directly linked to a specific amount of gold, and this fixed exchange rate provided stability and confidence in the currency.

In this context, the quote highlights the importance of gold as a backing for the issuance of banknotes. When the supply of gold becomes scarce, the ability of financial institutions to maintain the necessary reserves to support the value of their notes is compromised. This can lead to a loss of confidence in the currency, as the underlying security for the notes is perceived to be inadequate.

The mention of panic in the quote is indicative of the potential consequences of such a situation. A loss of faith in the stability of the currency can lead to a rapid and widespread attempt to exchange banknotes for gold or other assets, creating a run on the banks and exacerbating the financial instability. This panic can further erode the value of the currency and have far-reaching implications for the broader economy.

While the gold standard has largely been abandoned in favor of fiat currencies, where the value of money is not linked to a physical commodity, the principles outlined in the quote still hold relevance. The stability and confidence in a currency are crucial for the smooth functioning of an economy. Even in today's monetary systems, the perception of a weakening or insecure backing for a currency can lead to similar panics and disruptions.

It is also worth noting that the quote's author, John Robinson, was a politician. This context adds an additional layer of significance to the quote, as it reflects the understanding and awareness of the potential economic and social ramifications of fluctuations in the gold supply and their impact on the stability of the financial system. Politicians and policymakers play a critical role in shaping and implementing monetary policies that can mitigate the risks highlighted in the quote and ensure the resilience of the financial infrastructure.

In conclusion, the quote encapsulates the intricate relationship between the supply of gold, the security of banknotes, and the potential for financial panic. It underscores the historical significance of gold as a backing for currency and the implications of its scarcity for the stability of the monetary system. Moreover, it serves as a reminder of the ongoing importance of sound monetary policies and robust financial regulations to safeguard against the destabilizing effects of fluctuations in the gold supply.