CHAPTER XV 



MODERN ECONOMICS 



WEALTH is a means of procuring the satisfaction 

 of impuses ; and it may be defined as potential 

 satisfactions that are embodied in a material 

 form, and are therefore capable of being trans- 

 ferred from hand to hand, and of being pledged 

 as security for a loan. Immense is the importance 

 of this last quality. For our economic system 

 is based upon credit that is to say, upon the 

 anticipation of future receipts. The manufac- 

 turer pays his workmen because he expects to 

 sell the things that they make : his capital may 

 be provided by borrowing upon the security of 

 his buildings, machinery and stock of unsold 

 goods : the merchant raises money wherewith to 

 continue his business by hypothecating his 

 consignments before they are delivered. Money 

 itself may, indeed, be considered as a form of 

 credit that is insured against failure by its 

 intrinsic value. A sovereign is of use to us 

 because it represents a sovereign's worth of 

 future satisfactions. It is true that money may 

 be borrowed upon security that is not material : 

 a tradesman may borrow upon the goodwill of 

 his business, an artist may obtain credit upon the 

 money value of his talents. But security is 

 imperfect unless it is represented by a thing that 

 can be transferred from hand to hand before it 

 is finally appropriated. The pawnbroker is the 



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