2. Which of the following statements about the banking system of Bagehot's day is INCORRECT? O The Bank of England could not lend freely in the face of external drain because of its very limited gold reserves O) A bank with too many discounts and too few notes could borrow from other banks using rediscount O The Bank of England could lend freely to meet an external drain because of its massive gold reserves O The division of the Bank of England into separate Banking and Issue departments served to keep notes scarce, and so acted as a mechanism of discipline O The central bank could supply an internal drain because it was at a higher level in the money-credit hierarchy than other banks