402 INDUSTRIAL INSTITUTIONS. 



return a memorandum of it a memorandum of a claim 

 against the custodian, which served for making payments. 

 In England, where the Tower was used as a place of safe 

 deposit by merchants until, having been robbed of 200,000 

 by Charles the First they had to find safer places, there grew 

 up the practice of putting valuables in the vaults of gold 

 smiths, and receiving &quot; goldsmith s notes. 7 These were pre 

 sently used for making payments; until, from the need for 

 having amounts divisible into convenient portions, the gold 

 smith s notes became promises to pay the sums named in 

 them, without reference to the particular properties of A, B, 

 or C which had been deposited : they became bank-notes. 



Of further developments it is requisite to name the system 

 of cheques, long in use among ourselves but only recently 

 adopted abroad. Save when made &quot; not negotiable,&quot; these, 

 especially in country places, pass from hand to hand as local 

 notes do. Lastly, to movable memoranda of claims have to 

 be added the fixed memoranda; made in merchants and 

 tradesmen s books. For these serve in place of immediate 

 exchanges of coin for goods, and form one variety of those 

 partially completed transactions, or postponed payments , 

 above named, from which a credit-currency originates. Ob 

 viously these diminish the labour of exchange, especially in 

 small places where tradesmen are customers to one another, 

 and half-yearly, after balancing accounts, give and receive 

 the differences: these, too, being generally in the form of 

 cheques or memoranda of claims. 



By this credit-currency all large transactions and a great 

 mass of small ones are in our days effected. A trader s bank 

 ing account is simply a record of claims against him and 

 his claims against others, which are continually discharged 

 by one another and the debits and credits balanced. And 

 now that this system has been developed so far that by the 

 Clearing House the claims of bankers on one another are 

 three times a day compared and memoranda of the differ 

 ences exchanged now that this system, once limited to Lon- 



