The times. [volume] (Richmond, Va.) 1890-1903, 1894-05-17
rruoSrou. IDEAS OF FINANCE.

The popular idea regarding money and
It's functions under the existing condi-
tions of the world. is as erroneous as
the popular idea four hundred years ago
that the sun moved around the earth.
That popular idea" is confined now
TO such astronomers as the Reverend
Jasper, and the present popular ideas
about money will be soon confined to
financiers of the Jasper order. The root
OF the error lies in the great body Of
mankind totally Ignoring the effect in
commerce Of the quick transportation of
bulks by steam, and of Intelligence by
the mails, the telegraph, and the tele-
phone. These have ended the day when
business was done by selling one article
for money and buying another article
with that money. That never was the
really essential principle Of business, but
until we got control Of steam and cleo
tricity conditions were such that great
part OF business was forced to assume
that form. But business always was
and always must be. at bottom, an ex-
change of commodities. and the only
use Of money in business Is as an ad-
junct and aid to those exchanges. The
transactions which are essentially ana
only sales for money are, compared with
commerce, as a drop of water TO the
ocean. And now that we have steam and
electricity, business reduced 10 its last
analysis will be found to be in sub
stance something like this: A planter
in Alabama nominally sells a hundred
bales OF cotton and buys thousand
bushels Of wheat and a carload of
bacon. This was really an exchange OF
the one for the other, and 1t was brought
about thus: The cotton planter got
bank credit of the value OF his cotton,
less q margin, for possible shrinkage in
value. which he had to make good posi-
bly, with money. The western farmer got
O. bank credit OF the value of his wheat
and bacon In the same way. The cotton
planter gave the western farmer a check
on his bank credit for the wheat and
bacon, and the bacon and wheat were
transferred TO him. The western farmer
deposited this check in his bank and
paid his debt TO IL with II. The western
farmer gave a check on his bank credit
70 the cotton planter, and the cotton was
transferred 10 him. and the cotton planter
deposited this check and thereby paid his
debt to his bank. The two banks ex-
changed checks. and the debts of the
borrowers were cxtinguished. the banks
having made their commissions and inter-
est. and the transaction was closed. Now
all that has been done by this transaction
is TO exchange some cotton for some wheat
and bacon, and the only part that money
has played In the transaction is 20 settle
the difference, II one was worth more
than the other, and 10 serve as margin
10 satisfy the banker that each com
modify would maintain the value IL was
represented TO have; and personal credit
would have answered for that as well
az money. This is the essential nature
and last analysis Of ninety-nve transac-
lions out OF every hundred. though
their actual natures are covered up by
many intervening transactions; and IL Is
obvious from consideration Of il that
money Is not what Is wanted, bat place
where the dealer can get credit. Where
can he get credit? Obviously in his
neishborhocd. where his character and his
means are known. and obviously he can
not get credit out OF his neighborhood
where neither he nor bis means are