World Money; A Study of the World Problem of Stable Money (Paperback)

This historic book may have numerous typos and missing text. Purchasers can usually download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1909 edition. Excerpt: ...bank notes are outstanding. The practically permanent use of a large volume of non-legal tender notes in active circulation proves that the claim that there was an inflation of the volume of the circulating medium as a ground for restricting the coinage of silver was unfounded in fact--as has so often been said in the last twenty-five years; one more gold pretence gone wrong. To restrict the standard coinage to one metal is to make the volume of legal tender less elastic than it would be were two metals coined. In order to effect the exchange of goods for goods a certain total of deposit currency plus circulating currency is needed. If the volume of legal tender is small we can get the required volume of exchange by correspondingly decreasing the legal tender reserves required of the bank deposit currency. The gold advocates always claim that there is and never has been a scarcity of gold; and this claim is correct if the bank reserve can be made small enough, a tenth of one percent if necessary, anything the banker can swear by. The net result is that the smaller is the volume of legal tender, other things equal, the larger will be the demand for credit bank notes. Of course the banker serves his own interest, therefore is the eternal foe of any scheme that will provide a large volume of legal tender. For nearly a century he has succeeded in restricting the volume, of legal tender and now discovers that there is need of some hundreds of millions of his credit notes. Every time we have a panic he discovers that the whole trouble came because his currency was not elastic enough. He first creates an artificial and needless scarcity of legal tender and then moves heaven and earth to induce the country to permit him to fill the partial vacuum...