The Richmond Virginian. (Richmond, Va.) 1910-1920, 1916-11-12

that unanestionably by far the greater
portion OF this loss was brought about
directly or indirectly by indiscriminate
extension OF credit on the part OF the
retail distributors. This loss does not
include the extra burden placed upon
consumers who pay their bills. by
reason of their having been charged
an axtra profit by the retailers to re-
cup losses on bad accounts.
Under the present system there To
80 way to avoid taxing those who pay
an extra profit to cover these losses.
1t muut be done. and by jobber and
retailer alike. but as a matter OF rfEht
and justice this should not be. The
only possible way to avoid making the
innocent suffer Is TO avoid the losses.
And the only way to avoid the losses
is TO do business on business princi-
pies and refuse to extend credit where
the risk Ia not backed by both the
ability and disposition to pay. 1t IL
realized that this may sound like
hard, cold doctrine. but II We are to
practice charity 1t should be done in
the name OF charity, and the amount
of money involved should come out of
private, individual funds, after they
have been set aside ~ such, and not
out of undetermined and problemati-
cal profits which may not exist and
which. IL they do not exist, makes the
extension of credit out of purs kind
heartedness result in the giving away
Of that which rightfully belongs to
someone else which should never be
done. as every individual has the in
herent right to administer that which
belongs to him, and that only.
Information the BASIS of Credit.
If the principle Of extending credit
s.sA1x ~ h. - =
point OF character and capitaD 10 &C.
cepted. than the task that confronts
the grantor Of credit 10 that Of de-
erming the worthy and that II the
point At which - many merchants tall
down There are two principal ave-
nues for obtaining this Information.
These are statements, either verbal or
written written preferred) from the
seeker Of credit as to his financial
standing. his earning capacity. etc.
and the getting Of references from
whom may be learned something Of
his disposition to pay. or in other
words. his business character. IN
fortunately. this false theory Of obli-
cation on the part OF the merchant to
the customer. previously referred to,
lis responsible for the, fact that these
avenues of Information are SO little
used, but this should not be. Every
merchant extending credit owes It to
his business. his creditors and himself
to obtain this Information, and It IL a
sad state OF affairs when a seeker of
credit takes offense at the effort on the
part Of merchant to obtain this In
formation. Tho worthy shouids be
glad to DO Investigated and thereby
give assurance that his obligation will
be met. and the practice should be 10
encouraged that . reluctance to give
such assurance would become at once
a danger signal.
1t is. OF oourDe, possible tha4 IN
formation on these points may be had
from outside sources. and 1t Is Of the
highest importance to grantors of
credit than It be had through some
source. Ono means of obtaining II IL
ny free. open and honest interchange
OF experiences between merchants.
This can be done individually, but It
IS by far more economical ana effec-
tive to DO II through some organised
bureau maintained for that purpose,
and merchant who refuses to par
ticipate in the getting and giv1nr Of
Information through such bureaus II
beyond question a back number. and
the sooner he 10 supplantsd (as he
inevitably will boz by one Of up-to-
date ideas and methods the better VII
be the calling Of Newfoundland