Waterbury evening Democrat., 1891-01-10
THE USE OF MONEY.
It's Importance in the Transaction
 of Business.
An Estimate of the Amount of Currency in Circulation in the United States The Extent of Bank
 tug Facilities.

It is a common saying that money is the ruling element in the life of the American people. Our foreign critics have urged it against us, and we too often are apt to give a tacit assent to the charge. But while, in reality, the accusation of being a Nation given up to the pursuit and capture of dollars is manifestly unfounded, there are certain elements in our social condition which would tend to give color to such a view, at least in the eyes of those unacquaint- ed with the real conditions of our social existence. The United States, taking 1t for all in all, says n writer in Once a Week, contains the most radically in- dustrial and commercial people in the world. In no other land is idleness counted such a sin, and nowhere else does the force of example and the pressure of public opinion unite with such force to make every man, even every woman, it might be said, a worker. Our millionaires in their social life may initiate the customs of the aristocracy of Europe. But even the Vanderbilts, Astors and Goulds are workers. They do not, as is the case with the wealthy classes of Europe, commit the charge of their vast possessions to the care of stewards and agents. They give their business interests a close, personal supervision, and it is the rule to find in the third and fourth generation of American families of wealth, energetic, successful and busy men of affairs. Eliminate the offensive sense contained in the word money, or better still, translate it to it's real signihcance-that is, business-and the alleged accusation is not only true but is something of which our people can be proud
 But, leaving aside this exceptional fact in our National life, that we have really no leisure class and very little need for one, there are some curious circum- stances in the relations of the American people to this article of money We talk about it great deal, and we of course are forced to use it at every turn of the existence of each individual among us. But, after all, it is only symbol. It Is the measure with which things of value are compared, and the symbol which represents their commer- cial status. Money is the counters with which the great and exciting game of business is played. One hears of the money market, and learns from time to time that the commodity it deals-in is plentiful, or the reverse. It is even urged that there is not enough money to satisfy the actual requirements of the country, and Congress is called upon to meet the need by providing additional money. But the fact re- mains that apart from it's use in retail business for satisfying the immediate requirements of our vast population, actual money is not the largest item in the world of business. The largest transactions are uniformly effected by another set of counters, which repre- sent money, just as money represents value, either intrinsic or based on the credit of the Government.
 The actual money of all kinds, metal lie and paper, in circulation in the United States at this time is near 8 billion and three-quarters of dollars. Of this the United States Treasury gen. erally holds about two hundred and fifty million as reserve and for other purposes, while the banks and other financial institutions scattered through out the country are obliged to hold permanently probably double that amount. The actual money in circula. tion In the hands of the people would therefore seem to be close to a round billion. But even allowing for the freest circulation of this stock of cur. rency among fifty millions of people, the amount seems very small in comparison with the aggregate value of the busi. ness transactions of the country. The real fact of the matter Is that the bulk of our business Is carried on through the highly artificial medium afforded by the use of banks and the facilities which they afford in the way of drafts and checks. Every one knows that it IS unusual to pay amounts of over a few dollars in actual money. All the great transactions of commerce and speculation are effected through banks. They furnish the means bv which the use of money is economized. and the limited amount of available cir culating medium is made to perform many times the work it could do bv itself.
 Moreover, there is a means by which the extent of this work can be guessed In all of the large cities of the country. the banks have formed associations known as clearing houses. A great deal of their business naturally consists of the receipt on deposit of checks drawn on other banks. Now, to collect such checks in each instance would in- volve endless work, and necessitate the transfer of vast amounts of money every day. The clearing house is an agency to which all the banks of given city arc able to compare the amounts of each others checks in their hands, and to effect settlement of the balances only. Statistics are therefore available from all the clearing houses to show the amount of such exchanges. The figures from forty cities show that last year the total exchanges of checks amounted to over fifty billions of dol lars, while the balances paid in con- nection with them foot up over six bill lions. This of itself shows mass of business transactions fifty times larger than the available supply of currency. Indeed, it does not in- clude the checks drawn directly on