# Credit

Credit is the provision of resources (such as granting a loan) by one party to another party where that second party does not reimburse the first party immediately, thereby generating a debt, and instead arranges either to repay or return those resources (or material(s) of equal value) at a later date. It is any form of deferred payment.

## Quotes

* All the perplexities, confusions, and distresses in America arise, not from defects in their constitution or confederation, not from a want of honor or virtue, so much as from downright ignorance of the nature of coin, credit, and circulation.
** John Adams, letter to Thomas Jefferson, August 25, 1787. — The Works of John Adams, ed. Charles Francis Adams, vol. 8, p. 447 (1853).
* It is wonderful how much good a man may do in this world if he does not care who gets the credit of it.
   * Helen Rickey Albee, Abnákee Rugs: A Manual Describing the Abnákee Industry, the Methods Used...p.26
* When a banker, in addition to his other functions, is also an issuer of paper money, he gains an advantage (...) the banker by issuing it levies a tax on every person who has money in his hands or due to him. He thus appropriates to himself a portion of the capital of other people, and a portion of their revenue.
   * John Stuart Mill, Essay IV: On Profits, And Interest in: Essays on Some Unsettled Questions of Political Economy, London: John W. Parker, West Strand (1844), pp. 117-118.
* Propositions prey upon and are grounded upon one another just like living forms. They support one another as plants and animals do; they are based ultimately on credit, or faith, rather than the cash of irrefragable conviction. The whole universe is carried on on the credit system, and if the mutual confidence on which it is based were to collapse, it must itself collapse immediately. Just or unjust, it lives by faith; it is based on vague and impalpable opinion that by some inscrutable process passes into will and action, and is made manifest in matter and in flesh; it is meteoric - suspended in mid-air; it is the baseless fabric of a vision to vast, so vivid, and so gorgeous that no base can seem more broad than such stupendous baselessness, and yet any man can bring it about his ears by being over-curious; when faith fails, a system based on faith fails also.
** Samuel Butler, Ramblings In Cheapside (1890).
* The only road, the sure road—to unquestioned credit and a sound financial condition is the exact and punctual fulfilment of every pecuniary obligation, public and private, according to its letter and spirit.
** Rutherford B. Hayes, speech at N. E. Society Dinner, Brooklyn, Dec. 21, 1880.
* The use of money does not disestablish the normal process of creating credit. Money, it is true, is always being paid into the banks by the retailers and others who receive it in the course of business, and they of course receive bank credits in return for the money thus deposited. But for the manufacturers and others who have to pay money out, credits are still created by the exchange of obligations, the banker's immediate obligation being given to his customer in exchange for the customer's obligation to repay at a future date. We shall still describe this dual operation as the creation of credit. By its means the banker creates the means of payment out of nothing, whereas when he receives a bag of money from his customer, one means of payment, a bank credit, is merely substituted for another, an equal amount of cash.
** Economist Ralph George Hawtrey, Currency and Credit (1919), p. 20.
* Let me remind you that credit is the lifeblood of business, the lifeblood of prices and jobs.
** Herbert Hoover, address at Des Moines, Iowa, October 4, 1932. — The Public Papers of the Presidents of the United States: Herbert Hoover, 1932–1933, p. 467.
* The maxim of buying nothing without the money in our pocket to pay for it, would make of our country one of the happiest upon earth. Experience during the war proved this; as I think every man will remember that under all the privations it obliged him to submit to during that period he slept sounder, and awaked happier than he can do now. Desperate of finding relief from a free course of justice, I look forward to the abolition of all credit as the only other remedy which can take place.
** Thomas Jefferson, letter to Alexander Donald, July 28, 1787. — The Papers of Thomas Jefferson, ed. Julian P. Boyd, vol. 11, p. 633 (1955).
* Private credit is wealth; public honor is security; the feather that adorns the royal bird supports its flight; strip him of his plumage, and you fix him to the earth.
** Junius, Affair of the Falkland Islands, Vol. I, Letter XLII, reported in Hoyt's New Cyclopedia Of Practical Quotations (1922), p. 148.
* Within the credit relationship, it is not the case that money is transcended in man, but that man himself is turned into money, or money is incorporated in him. Human individuality, human morality itself, has become both an object of commerce and the material in which money exists. Instead of money, or paper, it is my own personal existence, my flesh and blood, my social virtue and importance, which constitutes the material, corporeal form of the spirit of money.
** Karl Marx, "Commentaries on James Mill" (1844)
* If the Nation is living within its income, its credit is good. If, in some crises, it lives beyond its income for a year or two, it can usually borrow temporarily at reasonable rates. But if, like a spendthrift, it throws discretion to the winds, and is willing to make no sacrifice at all in spending; if it extends its taxing to the limit of the people's power to pay and continues to pile up deficits, then it is on the road to bankruptcy.
** Franklin Roosevelt, governor of New York, campaign address on the federal budget, Pittsburgh, Pennsylvania, October 19, 1932. — The Public Papers and Addresses of Franklin D. Roosevelt, 1928–1932, p. 797 (1938).
* Credit is like a looking-glass, which, when only sullied by an unwholesome breath, may be wiped clean again; but if once it is cracked, it is never to be repaired.
** John Scott, The Christian Life (1681–1700), Part III, Chapter IX: "Of Justice", in The Works of John Scott (Oxford: Clarendon Press, 1826), Vol. III, p. 408.
* Credit is the vital air of the system of modern commerce. It has done more, a thousand times, to enrich nations, than all the mines of all the world. It has excited labor, stimulated manufactures, pushed commerce over every sea, and brought every nation, every kingdom, and every small tribe, among the races of men, to be known to all the rest. It has raised armies, equipped navies, and, triumphing over the gross power of mere numbers, it has established national superiority on the foundation of intelligence, wealth, and well-directed industry. Credit is to money what money is to articles of merchandise. As hard money represents property, so credit represents hard money; and it is capable of supplying the place of money so completely, that there are writers of distinction, especially of the Scotch school, who insist that no hard money is necessary for the interests of commerce. I am not of that opinion. I do not think any government can maintain an exclusive paper system, without running to excess, and thereby causing depreciation.
** Daniel Webster, remarks in the Senate in favor of continuing the charter of the Bank of the United States, March 18, 1834. — The Writings and Speeches of Daniel Webster, vol. 7, p. 89 (1903).
* He smote the rock of the national resources, and abundant streams of revenue gushed forth. He touched the dead corpse of Public Credit, and it sprung upon its feet.
** Daniel Webster, speech on Hamilton, March 10, 1831, Vol. I, page 200.
* A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men who, even if their action be honest and intended for the public interest, are necessarily concentrated upon the great undertakings in which their own money is involved and who necessarily, by very reason of their own limitations, chill and check and destroy genuine economic freedom. This is the greatest question of all, and to this statesmen must address themselves with an earnest determination to serve the long future and the true liberties of men.
** Woodrow Wilson, The New Freedom, Section VIII : Monopoly, Or Opportunity? (1913).