Page:Coin's Financial School.djvu/68

 50 to pay so much money. The money promised is the redemption money.

"With so much paper or credit money in your possession, there is supposed to be that much redemption money to your credit with the government or bank issuing it. It is a check to bearer for money, when presented.

"Hence it is called credit money. It circulates on the credit of the government, on the confidence of the people that the government will be able to redeem it if it is presented.

"I have taken pains to impress on you the distinction between actual money and credit money, as no just comprehension of our monetary system as a science can be had without it.

"Actual money was too cumbersome to handle in all the transactions of business, and this gave rise to issuing credit money representing it. Like wheat in your wheat elevators certificates are issued to those who put their wheat there. Such certificates are traded in. Each time one of them is transferred, it is equivalent to transferring the wheat itself. Wheat is behind the certificates. A man does not carry a brick house around in his pocket, but he can carry the deed to it.

"When you have credit money in your pocket, you are carrying around with you the title to property of that commercial value.

"In issuing dollar for dollar of credit money to redemption money, it is not necessary that the government should keep the latter at all times in its treasury in full amount ready to redeem all the credit money.

"Experience teaches that so long as sufficient redemption money is in the country, the credit of the government can be depended upon to get it. But it