APPENDIX. 



047 



is eliminated, so far as is possible in human aftairs. The column showinfj rates 

 (per annum) upon !<ixty-day paper represents money loaned by commercial 

 banks to merchants, the money being mainly the balances of depositors, and 

 so subject to check at sight. When business is lively, interest upon such loans 

 tends to rise by reason of increased demand, and in times of panic, it tends to 

 rise still more, by reason of distrust of security offered, and the unwillingness 

 of banks to lend money whose owners are likely to call for it at any moment. 

 This accounts for the raise of interest rates in the panic years of 1857 1873, 

 and 1893. 



On the other hand, the columns showing current rates of interest upon gilt- 

 edged bonds represents money intended to be permanently invested, and, as 

 will be noted, the interest rate is not aflected by business conditions. 



While these figures are doubtless reliable as to interest rates received by 

 capitalists for large sums, when security is believed to be perfect, every farmer 

 knows that they bear no relation to the rates which he has to pay upon mort- 

 gage loans. I can find no evidence of any reduction in the rate of interest 

 upon small loans upon such security as the farmer can off"er. The "retail" 

 price of money has not fallen according to my observation, but I know of no 

 data establishing the fact. 



INTEREST RATES REALIZED. 



