Money and Trade Considered [13]
encreases, the Credit of the Bank encreases, and the Sum of Notes out is greater; And so far from making the People less sensible of the condition of the Country, a surer Judgment of the state of Trade and Money may be made from the Books of the Bank, than any other way. If Trade can be carried on with a 100000 lib. and a Ballance then due by Forreigners; The same measures, and a greater Quantity of Money, would make the Ballance greater. Nor is that Additional Money the Bank furnishes, to be suppos'd will be lost, if by a Ballance due from Trade the Silver Money encreases: That Credit may fail from an accident when Money is plentiful, and would soon be recover'd; 'Tis only lost by a scarcity of Money. Such a Credit may support Trade, in cases where without it Trade would sink, but cannot do prejudice. Another Objection is made against the Bank. That it encourag'd the Exportation of Money, by furnishing Sums in such Species as were of most value Abroad. To answer this Objection, I shall make a Supposition. A.B. Merchant has occasion for a 1000 lib. in Holland, and desires C.D. Banker to give him a Bill for that value; There is no Money due in Holland to Scots Merchants, so C.D. must Export the Money to pay the Bill he Draws: But there being no Bank, nor any possibility of getting a 1000 lib. in 40 Pence Pieces, he sends out Money of different Species. This does not hinder the Money to go out, but makes the Exchange dearer by 2 or 3 per cent, then it would have been if 40 Pence Pieces could have been got. And tho no other Money were left, but old Marks, if a Ballance is due these will go out, tho not worth 10 Pence: The Exchange will be so much higher, the profit of Exporting is the same; And so far from doing hurt to the Country, the Bank by furnishing such pieces as could be Exported to least loss, kept the Exchange 2 or 3 per cent lower than otherwise it would have been, and saved yearly the sending out a considerable Sum to pay a greater Ballance, the higher Exchange would have occasioned.
Chapter 4
The Several Measures now propos'd, consider'd. As, raising or allaying the Money. Coyning the Plate. Regulating the Ballance of Trade. Or, Re-establishing the Bank.
When I use the Words, Raising the Money, I desire to be understood raising it in the Denomination; For I do not suppose it adds to the Value. There is no way Silver can be made more valuable, but by lessening the Quantity, or encreasing the Demand for it. If the Export and Consumption of Silver be greater than the Import, or the Demand be encreas'd; Silver wil be of more Value. If the Quantity Imported be greater than the Quantity Exported or Consumed, or the Demand lessen'd; Silver will be of less Value.
If raising or allaying the Money could add to its Value, or have any good Effect on Home or Forreign Trade; Then no Nation would want Money. A 100 lib. might be rais'd or allay'd to 2, to 10, to a 100 times the Denomination it had, or more as there were occasion. But as 'tis unjust to raise, or allay Money; Because, then all contracts are payed with a lesser Value than was contracted for; And as it has bad effects on Home or Forreign Trade: So no Nation practices it, that has regard to Justice, or understands the nature of Trade and Money. If A.B. sell 12 Chalder of Victual for a 100 lib. payable in 6 Months, with which he is to pay Bills of Exchange of that Value, to be drawn on him then from France for Wine he has Commission'd; and in that time the Money is rais'd or ally'd to double, the 100 lib. A.B. receives will only pay half the Bill he has to pay, being only equal to 50 ib. of the Money he Contracted for. Nor will that 100 lib. buy the same Quantity of Goods of the Country, that a 100 lib. brought before: It will pay where Money is due, and satisfie past Contracts made upon the Faith of the Publick, because the Prince says every Man shall take half what is owing him in full Payment. But in bargains to be made, the Value of the Money will be considered; Goods will rise, tho perhaps
Chapter 4
The Several Measures now propos'd, consider'd. As, raising or allaying the Money. Coyning the Plate. Regulating the Ballance of Trade. Or, Re-establishing the Bank.
When I use the Words, Raising the Money, I desire to be understood raising it in the Denomination; For I do not suppose it adds to the Value. There is no way Silver can be made more valuable, but by lessening the Quantity, or encreasing the Demand for it. If the Export and Consumption of Silver be greater than the Import, or the Demand be encreas'd; Silver wil be of more Value. If the Quantity Imported be greater than the Quantity Exported or Consumed, or the Demand lessen'd; Silver will be of less Value.
If raising or allaying the Money could add to its Value, or have any good Effect on Home or Forreign Trade; Then no Nation would want Money. A 100 lib. might be rais'd or allay'd to 2, to 10, to a 100 times the Denomination it had, or more as there were occasion. But as 'tis unjust to raise, or allay Money; Because, then all contracts are payed with a lesser Value than was contracted for; And as it has bad effects on Home or Forreign Trade: So no Nation practices it, that has regard to Justice, or understands the nature of Trade and Money. If A.B. sell 12 Chalder of Victual for a 100 lib. payable in 6 Months, with which he is to pay Bills of Exchange of that Value, to be drawn on him then from France for Wine he has Commission'd; and in that time the Money is rais'd or ally'd to double, the 100 lib. A.B. receives will only pay half the Bill he has to pay, being only equal to 50 ib. of the Money he Contracted for. Nor will that 100 lib. buy the same Quantity of Goods of the Country, that a 100 lib. brought before: It will pay where Money is due, and satisfie past Contracts made upon the Faith of the Publick, because the Prince says every Man shall take half what is owing him in full Payment. But in bargains to be made, the Value of the Money will be considered; Goods will rise, tho perhaps