The new dominion. [volume] (Morgantown, W. Va.) 1876-1904, 1883-05-26
CURIOSITIES OF CREDIT.

CURIOSITIES OF CREDIT.
Examples of the Trust UnderIyink nusi-
ness--The Promises to Pay Of Mer.
chants and How They are Regulated In
the Usual Channels Of Trade.
How much personal confidence has
to do with enabling the social and bust
ness life of the day to be carried on is
nowhere better shown than in a con-
sideration of the system of credit which
underlies all manner of transactions.
Nothing, indeed, is more apt to be-
wilder than casual survey, which
serves only to illustrate to how great an
extent the principle of trusting Is re-
sorted to. There is quite large bust
ness done in the sale of striking cards,
illustrated with more or less taste, which
convey to the reader the information
that Poor Trust is Dead-Bad Pay
Killed Him. And when this motto
appears, accompanied by a striking cut
in colors showing a dead dog lying ON
the ground with legs uplifted and with
piteous expression of countenance,
fixed apparently by the instantaneous
process" while the animal was in the
last throes of dissolution, it is very diff
ficult for the unpractised observer to
resist the conclusion that the motto is
rigidly adhered to by the person in
whose premises the sign is displayed
A little experience, however, shows how
much of hollow mockery the thing is.
What is known to the vulgar as ''the
slate, appears everywhere in one form
or another. The record of trust changes
in character. 1t varies from the chalked
markings on the cellar door through
various grades of accounts until it
reaches its acme in big sheep-bound and
heavily ribbed volumes filled with speei-
mems of the penman's art and the
book-keeper's best skill. But the thing
chronicled is the same. 1t is record
of trust, confidence, credit, and it
marks the bridges which cross the
points of more or less prolonged impe-
curiosity. Its variances are almost in
Vulnerable and some are rather extra
ordinary To the latter class belongs
the case that was recently tried in one
of the courts of this city, wherein it APP
peared that a laundress had gone on
doing the washing. for two years or
Whereabouts for man who would have
been good customer had he but
voluntarily paid the large debtincurred.
1t is gratifying to note that sympa-
thetic jury-forgetting all their own
trials anent burned linen, limp cuffs
and collars and hashed buttons-gave
a verdict against the defendant, re-
quiring him to pay for the thousands of
pieces which had been rinsed, clear
starched and mangled for him. Every
grocer, haberdasher,V or other small
tradesman in a peor -neighborhood, has
constant, experiences in the credit line
with his neig hbors, and even pailfulsof
coal and punches of .'greens" are not
paid for until the buyers themselves
obtain their weekly wages. And
somewhat similar state Of affairs pre-
walls in what are called higher circles,
although the matter Of convenience of
payment rather than the ability to pay
is what governs there.
1t is, however, in the mercantile
world proper-the world whose horizon
is bounded by boxes and bales of goods
sent to-and from every habitable cline
that the system reaches its highest
and most notable development. Here
it is that complicated mechanism is
brought into play to give to credit its
widest range and most flexible appli-
ances. Rating agencies are employed
to keep-a record Of the transactions of
tradesmen, their liabilities and resour-
ces. 1t gets after while to be mat
ter of calculation as to the amount for
which a purchaser shall be trusted in
view of all his circumstances. Some of
the methods by which results are ar
rived at as well as a sketch of the ma
chinery in use for the purpose, form in
teresting features of the subject.
Promises to pay abound. The richest
house issues its paper as well as the
smallest. Brokerage establishments
have been founded, some of them with
81 1000, 900 at their command, to handle
the paper of the merchants, and there
are banks which makesa feature. of dis-s
counting the paper. One bank isknown
to have had as much as 1000, 900 of
the paper on hand IT. one time, and
there are three Or fourSwhich carry in
the neighborhood of $4,000, 900 worth
the year round.ss The. rate of discount
by the banks is all thesway from three
and one-half to twenty-five per cent,
according to outstanding of the signer,
and the broker receives one -fourth of
one per cent. for negotiating the paper.
merchant may draw his note for $780,
BOO. He wants $4,000 at once and the
remainder as soon as it is possible to OBJ
lain it. The broker advances the &c.,
900 out Of his own capital and he goes
60 the bank to negotiate the note. If it
is after banking hours when the mer-
chant draws'the note the $4,000 will
enable him to promptly meet an obliga-
ton, and the need is not SO usgent but
that the balance can go over until TIE
next day. The. broker, of course, de-
ducts his $4,000 as soon as he gets the
$50, 900, less. the discount, and the bank
carries the full amount when the paper
goes into its. keeping.
BY the recognized rules Of trade the
normal credit is limited to fifty per cent.
more than the capital of the house. To
take it beyond that limit reduces the