482 



FARMERS' REGISTER. 



[No. 8 



some common measure of the value of all com- 

 modities—itself cajuible of subdivision — became 

 apparent : thus money was introduced. In some 

 countries shells have been enij-loycd for this pur- 

 pose ; but civilized nations have, by common con- 

 sent, adopted the precious metals. The sovereign 

 power has, in most countries, assumed the right 

 of coining ; or, in other words, the right ofstamp- 

 ing with distinguishing marks, pieces of metal 

 having certain forms and weights, and a certain 

 degree of fineness : the marks becoming a guar- 

 antee, to the people amongst wlioni tlie money cir- 

 culates, that each piece is of the refjuired weight 

 and quahty. 



The expense of manuflicturing gold into coin, 

 and that of the loss arising from wear, as well as 

 of interest on the capital invested in it, must either 

 be defrayed by the state, or be compensated by a 

 small reduction in its weight, and is a far less ex- 

 pense to the nation than the loss of time and in- 

 convenience which would arise from a system of 

 exchange or barter. 



These coins are liable to two inconveniences: 

 they may be manufactured privately by individu- 

 als, of the same quality, and similarly stamped ; 

 or imitations may be inade of iiili?,rior metal, or of 

 diminished weight. The first of these inconve- 

 niences would be easily remedied by making the 

 current value of the coin nearly equal to that of 

 the same weight of the metal ; and the second 

 would be obviated by the caution of indiviiluals in 

 examining the external characters of each coin, 

 and partly by the punishment inflicted by the 

 state on the perpetrators of such frauds. 



The subdivisions of money vary in diderent 

 countries, and much time may be "lost by an in- 

 convenient system of division. The efl'ect is felt 

 in keeping extensive accounts, and particularly in 

 calculating the interest on loans, or the discount 

 upon bills of exchange. The decmial system is 

 the best adapted to facilitate all such calculations ; 

 and it becomes an interesting question to consider 

 whether our own currency might not be converted 

 into one decimally divided. The great step, that 

 of abolishing the guinea, has already been taken 

 without any inconvenience, and but little is now 

 required to render the change complete. 



IfJ whenever it becomes necessary to call in the 

 half crowns, a new coin of the value of two shil- 

 hngs were issued, which sliould be called by some 

 name implying a unit, (a Prince, tor instance,) we 

 should have the tenth part of a sovereign. A \hw 

 years after, when the public were familiar with 

 this coin, into one hundred instead of ninety-six 

 farthings ; and it would then consist of twenty-five 

 pence, each of which would be four per cent, less 

 in value than the former penny. The shillings 

 and sixpences being then withdrawn from circula- 

 tion, their place might be supplied with silver 

 coins, each worth five of the new pence, and by 

 others of ten pence, and of two pence halfpenny ; 

 the latter coin, having a distinct name, would be 

 the tenth part of a Prince. 



The various manufactured commodities, and 

 the various property possessed by the inhabitants 

 of a country, all become measured by the stan- 

 dard thus introduced. But it must be observed 

 that the value of gold is itself variable ; and that, 

 like all other commodities, its price depends on 

 tlie extent of the demand compared bv ihat of the 

 eu|)p]y. 



As transactions multiply, and the sums to be 

 paid become large, the actual transfer of the pre- 

 cious metals fi-oni one individual to another is at- 

 tended with inconvenience and difficulty, and it is 

 found more convenient to substitute written promi- 

 ses to pay on demand specified (juantities of gold. 

 These promises are called bank notes; and when 

 the person or body issuing them is known to be able 

 to fulfil the pledge, the note will circulate for a long 

 time before it gets into the hands of any person 

 who may wish to make use of the gold it repre- 

 sents. These paper representatives supply the 

 |)Iace of a certain quantity of gold ; and, being^ 

 much cheaper, a large portion of the expense of 

 a metallic circulation is saved by their emplo}'- 

 ment. 



As commercial transactions increase, the trans- 

 fer of bank notes is, to a considerable extent, su- 

 perseded by shorter processes. Banks are estab- 

 lished, into which all moneys are paid, and out of 

 which all payments are made, through written or- 

 ders called checks, drawn by those who keep ac- 

 counts with them. In a large capital, each bank 

 receives, through its numerous customers, checks 

 payable by every other ; and if clerks were sent 

 round to receive the amount in bank-notes due 

 from each, it would occupy much time, and be at- 

 tended with some risk and inconvenience. 



Clearing House. — In London this is avoided, by 

 making ali checks paid in to bankers pass through 

 what is technically called •^The Cleaj-ing House.'''' 

 In a large room in Londiard-strcet, about thirty 

 clerks from the several Jjondon bankers take their 

 stations, in al|)habetical order, at desks placed 

 around the room ; each having a small open box 

 by his side, and the name of the firm to which he 

 belongs in large characters on the wall above his 

 head. From time to time other clerks from every 

 house enter the room, and, passing along, drop 

 into the box the checks due by that firm to 

 the house from which this distributor is sent. 

 The clerk at the table enters the amount of the 

 several checks in a book previously prepared, un- 

 der the name of the bank to Avhich they are re- 

 spectively due. 



Four o'clock in the afternoon is the latest hour 

 to which the boxes are open to receive checks ; 

 and at a few minutes before that time, some signs 

 of increased activity begin to appear in this pre- 

 viously quiet and business-like scene. Numerous 

 clerks then arrive, anxious to distribute, up to the 

 latest possible moment, the checks which have 

 been paid into the houses of their emi)loyers. 



At four oVJock all the boxes are removed, and 

 each clerk adds up the amount of the checks put 

 into his box and payable by his own to other 

 houses, lie also receives another book from his 

 own house, containing the amounts of the checks 

 which their distributing clerk has put into the box 

 of eveiy other banker. Having compared these, 

 he wn'itcs out the balances due to or fi-om his own 

 house, opposite the name of each of the other 

 banks ; and having verified this statement by a 

 comparison with the similar list made by the 

 clerks of those houses, he sends to his own bank 

 the general balance resulting fi'om this sheet, the 

 amount of which, if it is due fi'om that to other 

 houses, is sent back in bank notes. 



At five o'clock the Inspector takes his seat ; 

 when each clerk, who has upon the result of all 

 the transactions, a balance to pay to various other 



