ESSENTIAL QUALITIES OF A SCIENTIFIC 

 MONETARY SYSTEM. 



PRINCIPLE NUMBER ONE. 



Money being a representative of wealth, a money system must 

 provide a sufificient volume and facilities to enable all wealth to be 

 represented by money. 



PRINCIPLE NUMBER TWO. 



As interest for money loaned is not "compensation for the use of 

 capital," the borrower possessing the capital (wealth), and needing but 

 the representative (except in cases where money is loaned without se" 

 curity), a money system must provide for the loaning of this represen- 

 tative at cost. 



PRINCIPLE NUMBER THREE. 



As the holder of a bank bill or government note is not thereby 

 the possessorof wealth, a money system must provide absolute security 

 against loss to the holder of paper money 



The three forgegoing principles constitute, in our judgment, the 

 basis of a correct money system, and any system that does not 

 fulfill their requirements, is unworthy of confidence, and fails to supply 

 what is wanted, as their application to the following systems will show. 



"SPECIE BASIS." 



The system most popular with bankers is commonly called "hard 

 cash," or "specie basis. "That is to say. gold and silver form (almost) the 

 only circulating medium, except bank bills, which are issued either by de- 

 positing an equal amount of coin as security, or in case an additional 

 amount of bills are issued, this additional ami^ount is otherwise "se- 

 cured" by mortgages, railroad and other stocks and bonds, individual 

 notes, etc., etc., etc., The amount in coin in all casesl to be sufficient 

 to satisfy the claims of such bill-holders as might (according to the 



