How were these questions answered in 19th century England? In the 1820s and 1830s, the English economy was rocked by several financial crises. In 1844, the Bank of England  BIS Review 75/2010  3  received new statutes, the famous Peel’s Act, that put severe constraints on the Bank of England’s ability to issue banknotes.
In particular, all notes issued in excess of a fixed amount had to be backed 1:1 in gold. Compared to earlier practice, this rule was extremely strict. The authors of the law were hoping that the monetary stability brought about by strict limits on the amount of banknotes in circulation would also prevent speculation in financial assets.