MUTUAL BANK INC. 35 



"It is eminently solid: since on one side it represents the ordi- 

 nary, local, personal, actual paper of exchange, determined in its 

 object and representing a real value, a service renderedj merchan- 

 dise delivered, or whose delivery is guaranteed and certain; while 

 on the other side it is guaranteed by the contract, in so/ido, of 100,- 

 000 exchangers, who, by their mass, their independence, and at the 

 same time by the unity and connection of their operations, offer 

 millions of millions of probability of payment against one of non- 

 payment. Gold is a thousand times less sure. 



"In fact, if in the ordinary conditions of commerce, we may say 

 that a bill of exchange made by a known merchant offers two 

 chances of payment against one of non-payment, the same bill of 

 exchange, if it is indorsed by another known merchant, will offer 

 four chances of payment against one. If it is indorsed by three, 

 four or a greater number of merchants equally well known, there 

 will be eight, sixteen, thirty-two, etc., to wager against one that 

 three, four, five, etc., known merchants will not fail at the same 

 time, since the favorable chances increase in geometrical propor- 

 tion with the number of indorsers. What, then, ought to be the 

 certainty of a bill of exchange made by lOO.OOa well-known sub- 

 scribers, who are all of them interested to promote its circulation? 



"I add that this title is susceptible of no depreciation. The 

 reason for this is found, first, in the perfect solidity of a mass of 

 100,000 signers. But there exists another reason, more direct, and if 

 possible, more reassuring; it is that the issues of the new paper can 

 never be exaggerated like those of ordinary bank-bills, treasury 

 notes, paper money, assignats, etc., for the issues take place against 

 good, commercial paper only, and in the regular, necessarily lim- 

 ited, measured and proportionate process of discounting. 



"In the combination I propose, the paper (at once sign of credit 

 and instrument of circulation) grows out of the best business- 

 paper, which itself represents products delivered, and by no means 

 merchandise unsold. This paper, I affirm, can never be refused in 

 payment, since it is subscribed beforehand by the mass of pro- 

 ducers. 



"This paper offers so much the more security and convenience, 

 inasmuch as it may be tried on a small scale, and with as few per- 

 sons as you see fit, and that without the least violence, without the 

 least peril. 



"Suppose the IJank of Exchange to start at first on a basis of 

 1,000 subscribers instead of 100,000; the amount of paper it would 

 issue would be in proportion to the business of these 1.000 subscrib- 

 ers, and negotiable only among themselves. Afterwards, according 

 as other persons should adhere to the bank, the proportion of bills 

 would be as 5.000, 10,(XX), 50,000, etc., and their circulation would 

 grow with the number of subscribers, as a money peculiar to them. 

 Then, when the whole of France should have adhered to the stat- 



