The Works, Political, Metaphysical, and Chronological, of the Late Sir James Steuart of Coltness, Bart (Volume 3) - Softcover

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Book may have numerous typos, missing text, images, or index. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. 1805. Excerpt: ... then exchangers will be obliged, by the best of all compulsions, their own interest, to think of other expedients ; bullion, manufactures, and natural produce. And when all these come to fail, a regular plan must be laid down, and authorised by government, for obtaining credit in other countries, by mortgaging the revenue of the solid property of the kingdom ; according to the principles we shall discover when we come to treat of exchange. • CHAP. XXI. How by a return of a favourable Balance the Bank may be enabled to pay off the Debts due to Foreigners) and thus deliver the Nation from thai Burthen. have said, that the banks in contracting debts, and mortgaging the property of Scotland to strangers, for the payment of a grand balance, really act as the guardians of the public, by interposing their credit, and by constituting themselves as debtors for the whole; taking for their relief, proportional securities upon the effects of individuals. We have also pointed out how, by this operation, the mass of bank securities comes to be greatly augmented. Before the payment of any balance for the behoof of Scotland be made, the securities in the hands of the bank can be equal only to the notes in domestic circulation, and the accumulated profits thereon. Let this be called (A). In proportion as these notes come back upon the bank, in a demand for bills to pay balances, in the fame proportion will there be a sum of securities added to the former mass (granted upon new credits given for filling up the void thereby occasioned to domestic circulation), which quantity I shall call (B). (A) then represents the securities equivalent to the notes in circulation. (B) represents the securities equivalent to the debts contracted by the bank in favour of strangers. Now let us suppose trade to be...

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