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July 1899

THE MONEY QUESTION

A HANDBOOK FOR THE TIMES

BY

HENRY V. POOR

AUTHOR OF "MONEY AND ITS LAWS," "RESUMPTION AND THE SILVER
QUESTION," "TWENTY-TWO YEARS OF PROTECTION,"

"POOR'S MANUAL OF THE RAILROADS

OF THE UNITED STATES,"

ETC., ETC.

NEW YORK

H. V. & H. W. POOR

44 BROAD STREET

1897

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AUTHOR OF "MONEY AND ITS LAWS," "RESUMPTION AND THE SILVER
QUESTION," "TWENTY-TWO YEARS OF PROTECTION,"

"POOR'S MANUAL OF THE RAILROADS

OF THE UNITED STATES,"

ETC., ETC.

NEW YORK

H. V. & H. W. POOR

44 BROAD STREET

1897

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PREFACE.

In the following pages money is treated as a subject coming within the range of the exact sciences, every proposition, if properly elaborated, having all the force of demonstration.

Three kinds of money are in use in the United States :

I.

Metallic money, the universal equivalent, and consequently the standard of value, its value being measured by its weight.

II. The notes and credits of banks and bankers, issued or assumed to be issued, in the discount of merchants' bills.

III. Notes of the Government, for the redemption of which, previous to their issue, no adequate means are provided.

The first kind need not be considered at any length, as its value is measured by its cost and the demand therefor, the insignia of Government adding nothing to its value.

The value of the second kind of money depends on the provision made for its retirement previous to its issue. If the institutions issuing it are restricted to the discount of bills representing merchandise prepared for, or in process of distribution, it will be retired by its use, being accepted equally with metallic money by the holders of merchandise, and by the issuers in the payment of bills in the discount of which it was issued. As it is safer and more convenient in use than metallic money it will have the preference, its use discharging capital from the exchanges. It has become the money of all commercial communities, metallic money having with them little other function than the discharge of balances arising in their foreign or domestic trade.

At the foundation of our Government provision for the second kind of money, that of commerce, was made through the instrumentality of a National Bank which served as the custodian of the public revenues collected and discharged by means of its notes. The Bank was restricted in its issues to bills of exchange representing merchandise in the process of distribution, its issues being a part of the

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