Year: 1872

An exchange pleads with, the, capi-


talists to be more liberal in.thei poll
cy toward young and struggling bus


mess men, and then asks the question:
~ Is it not better for the rich man to
loan money at 6 per cent, and have


the city grow and flourish, than to


exact IL per.cen and have il wither
and wane? We wonder how many
men of fortune ever think of the matt


ter in this way? And yet it is aft er
all. the soundest calculation that a
capitalist can make. For the general


prosperity of community affects ev-
cry person in il owning either fixed


or floating capital. And as prosperi-


ty is enhanced by an easy money mar
ket and low rates of interest, and is


retarded by q stringent money market
and high rates of interest, it stands to


reason that if the capitalists generally


agree in their policy of squeezing as
much money as possible out of bor-


rowers in the way of interest, the rest


of the people who are not capitalists
will retaliate in some way that will


tell upon the money lender.ed y Gai.


ls itnot clear The man who is


not compelled to submit to all exor-


bitants shave must either become in-
solvent or realize higher profit on


what be deals in. If he fails the.loss
comes at once on the money lender,
aud this is quite a common case all
Eoyer the country, aud will continue
to be so long as the rates of discount
are unhealthy and abnormal. These


rates are not such as the people gem
orally can afford to pay, and conse-
quently some one is certain TO fail.


Yet the discouHter invariably ignores
this fact and goes on shaving as be-
fore. If, on the other hand, The bor-


rover does not fail, he must save


himself by realizing a higher profit
ON the articles he deals in. In New


York and Chicago, where the rates of
discount are always exorbitant, pri-
,ces of all kinds are very high. Real
estate in both cities brings rates and
figures that seem preposterous and the
expense of living is enormous. 1t
cannot be otherwise while capital,
costs so much.


Let us suppose real estate owner
has q store on business street occu-.
pied by an old, prosperous and relia-l
BILE tenant at moderate rent. Incl
ted by greed he raises the rent one
third, which is quite a common case.
The tenant refuses to pay it, and hav-
ing the means at command buys an
other property and fits, up store of
of his own. The owner of the old
store has his place empty for a time
during which he loses the rent, and


then he leases it to a new tenant who
does not succeed and either fails or
moves off. Now we maintain that the
low rent of the first tenant is a better
return than the precarious chances of
the succeeding one. Many landlords
govern themselves by this principle.
And the case with regard to money is
the same. The man who makes up
his mind to invest his money in such
way as to risk no losses is sure to
accumulate and grow rich. Moreo-
yer, if we revert to the test from
which we started, it is better for cap.
ital to foster the general prosperity of
community, by lending at moderate
rates of interest, than to screw every
dollar out OF a needy borrower that
can be .exacted. Suppose. two private
discounters to pursue opposite lines
OF policy One takes every spos.i
sible advantage of the needy borrow
er, while the other when he finds O
business man in trouble, who deserves
a better fate, examines into his affairs
closely, ascertains the weak point,
the required capital at mod 4
crate rate, and secure permanent
and profitable customer, who sends
all his friends to the same banker.
Which of these men is the shrewdest !? ?
Which will grow richest 2. Which is
the truest exponent of the uses of cap
ital and the advantages of banking ?
Which is best for a community ?''h