The representative. [volume] (St. Paul, Minn.) 1893-1901, 1896-04-22
sTRORG POINTS WELL PUT.
E. Gerry Browns Discussion O1
Money at New England
Town Meeting.
A REMARKABLE LITTLE BOOK.

i
A REMARKABLE LITTLE BOOK.
IContinued from last week.l
CHAPTER VI
"Oh, how his heart does bleed for the
| widow and orphany' retorted the editor.
This banker has told you that the bust
i ness of his bank g to coin dollars out OF
their credit, and loan them to do the money
work. The principal business OF bank Is
| to create debt and draw interest on the
debt. Every dollar OF credit thus created
encroaches upon the honest value. and
cuts down the purchasing power af the
| honest dollar which the wage-worker. or
the widow and orphan, have earned by hard
toll and placed in the savings bank for IN
vestment. A bread-winner must labor for
years to save dollars which the National
bank can duplicate with q few strokes Of
| the pen in bank books. Every credit dol
lar issued by the national banks completes
with every dollar earned and saved by hon
est labor. This money power wants an
honest dollar, a dear dollar.-a scarce dol
lar when you earn1it: but 1t will create
mighty cheap dollar that Will do the same
work and absorb for it the same portion OF
labor's product to which dollar honestly
earned holds the only honest title" 4.
stI defy you to prove that assertion"
yelled the banker.
| 1T is easily proven said the editor.
Turn to page Of the report of the comp
troller of the currency, for Dec. 5, 1892.
and he says
"The aggregate clearing house, ira lsae-
tons for the year ending Oct. 81, 1892 in
81 clearing house Cites were SOL OH $685.
OCT; the balances were $4.881, TIT 289."
while the aggregate Of all other bus!-
ness is vast, yet 90 per cent of this volume
was transacted by the use of the credits
Of nation banks. Figure the interest on t,
and see what it costs the products of wealth
to support the distributors Of wealth. Again,
the record of a days business in national
banks page 32) shows that only 939 per
cent of the transactions was in cash; the
balance was TRANSFERRED Credits go
At this point stranger gained recogni-
ton, and said: "My name IS Coin; Il am a
professor in a financial school. I.teach that
the issuing of wheat certificates against
wheat in the elevator, to be redeemed in
wheat, does not alter the value Of the
wheat. Am I r.ght?"
Il should agree with YOU" said the editor.
That being true" continued Com, II
show that the value of money IS not altered
by this credit issued against the money
which must redeem It. The certificate for
cate for wheat"
chats very good point a strong
point" SAID the banker.
Wheat certificates" answered the ed:-
tor, "do not increase the quantity of wheat
in the elevator; credit does increase the
quantity of units IN existence because cred
it units enter into the money volume. and
do the work of money unit before seek
ing redemption. The money volume re
mains enlarged until the credit is redeemed
and retired
That's very good point,-a strong
point" said farmer.
At this moment Coin was engaged in a
controversy with a number of prominent
fnanciers and professors, who were 1ec!1r-
ing that they had never attended his school
to ask questions about silver. era.t
"But bank credit is not money per
sisted the banker impatiehtlv. en. p -
"You may mean, perhaps ssid the eli
tor, that the legal quality Of money is left
out of your creation, and therefore it is no.
money in legal sense; but it does the
work of money and takes the Place OF
money, while It is doing the money work
In other words, In the absence Of the money
instrument created by you, money would
be essential to perform the same work"
"There is money for every check and
draft that is drawn on the bank" said the
banker; "the check represents only the
money that IS IN existence"
ITO say that your credit doesn't serve a:
money, and then to claim that there j;
l Ca
credit, is an Inconsistency, to state It mild
~" answered the editor. Some men tsy
to believe that there is money for every
check, or, in other words, that your na-
tional banks, if called upon to do so, could
pay to their depos.tors On demand, as thes
are Obligated to do, 81 667 ,S43. 268.28: wber
:. they have on hand only 1855 1858. 253 sc
! with which to meet the checks of depos.t tors
for 81, 667 ,S43, 26828. Subtract the amount
!. Of money on hand from the amount they
have promised to pay, and you will DIS
! cover how much bank wind or coined
| credit, Is used as money That's the condi-
ton of the national banks as shown by tne
reports of the comptroller Of the currency
; April 6, 1895" 51>.,. = .,. Z
do you mean to say that the banks are
! insolvent?" asked the merchant
4'The question of solyency IS anoIhe'
: matter" answered the editor. "The hank:
have other property and their assets woul6
probably exceed their liabilities: but tina
was the condition of many merchants WHIT
! failed in the summer of 1893. HIS asset!
exceed mis- Liabilities, the newspapers wouit
,, say, but ne was forced to suspend for wan
of ready money The truth is that tn.
merchant was unable to obtain bank credit
!, which IS the money tool in most common
use. 1t was time for more money an(
less misery"
"The belief is general that there is none.
: to meet every check" said the merchant
"They believe it can be done. because. 81
: far as they discover. it is DONE" said tn
3 editor. "a draws check, and pays it Il
: b; B deposits it in the bank and draws
6 check to pay c.; G takes BIS check and de
! posts it in the bank and draws check t,
: pay A. Here are three checks drawn o.
: the bank for $1O0 each, and not dollar ha
Y be drawn out of the bank Each checl
| was honored. Persons who can compre
bend these transactions can understand tn
possibility of somewhat similar condition
under which the 81 clearing houses tran
!. sacted sixty thousand million dollars in OK
' changes with only per cent cash, and VIII
( It is that 20 cents cash in national banks ca
E lanswer the. demands of depositors for 10
| cents"