EXCHANGE, 
tainty of getting value for a bill of exchange 
drawn on an inhabitant of the West Indies, 
that scarcely any such bills can be said to 
exist : their payments are accordingly made 
by bills on Britain, and the exchange is ge- 
nerally high, being from 5 to 15 per cent, 
or more, in favour of the mother country. 
The United States of America are in a 
similar state of cultivation ; the bankrupt 
laws are introduced into a part only of 
these provinces, and the scope of Ameri- 
can policy is to afford security to the cre- 
ditor, without enabling him to compel pay- 
ment from his debtor, until after a process 
of great length. 
Accommodation Bills. By this term are 
understood bills drawn not on occasion of a 
real transaction, but for the purpose of af- 
fording a temporary supply of money, or 
accommodation to the parties. Such bills 
obtain currency for several reasons. It is 
often difficult to distinguish a real from a 
fictitious bill : even when a bill is consider- 
ed fictitious, it will still obtain currency, as 
the holder of it has the double security of 
the drawer and acceptor. It is as valid as 
a real bill, the law considering only whe- 
ther the holder has given value for it, and 
protecting him in the recovery of that va- 
lue : the shortness of the term also (seldom 
exceeding two months, and never almost 
exceeding three) naturally induces persons 
to think, that although the drawer and ac- 
ceptor be of doubtful credit, they will not 
fail quite so soon ; and, in the worst event, 
the holder has the prospect of a double 
chance of recovery from the estates of both 
parties. 
These circumstances have given a sur- 
prizing currency in this country to accom- 
modation bills. They are as adverse, how- 
ever, to commercial prosperity as real bills 
are favourable to it. If the negociator of 
accommodation bills compute the expence 
of exchange, stamps, the country bank 
charge, and the loss of his own time, he 
will find that he pays nearer seven than 
five per cent, interest for the loan. In nine 
instances out of ten these bills fail of pro- 
ducing their wished for effect, namely, a 
relief from difficulties ; and the unfortunate 
merchant, after wasting several of his best 
years in toil and agitation, is obliged to lay 
his affairs before his creditors in a much 
worse state than if he had decided on such 
a measure in the beginning of his embar- 
rassments. These embarrassments almost 
always proceed from going beyond his depth. 
The ambition which leads a man to advance 
his circumstances, and the hope which 
makes him strive by great exertion to avoid 
a mortifying exposure, are highly com- 
mendable in themselves, but the public in 
this country has much reason to complain 
of the excess to which they are carried. 
Accordingly the Bank of England directly 
discountenances all accommodation paper; 
they even withold discounts from all brokers 
and middlemen, and endeavour, wherever 
they can trace the transaction, to confine 
their discounts to the direct acceptance of 
the buyer to the seller. 
In the United States of America the 
banks avowedly sanction the practice of 
accommodation, and discount bills which 
they know to be fictitious. They are care- 
ful indeed to have at least one good name 
on these bills, so that they themselves are 
seldom losers ; but the practice creates a 
serious evil to the country. These bills, 
when due, must be paid by others of the 
same stamp ; the vortex is endless, and a 
war with England would produce a general 
failure among the exporters of American 
produce. 
Exchanges, arbitration of, are calcula- 
tions made to find through what intermedi- 
ate place it will be most advantageous to 
draw or remit. 
The drawee is the person in whose favour 
a bill is drawn ; the payee means the last 
holder, or the person to whom payment 
ought to be made. 
III. We shall now give a few examples 
of the mode of computing exchange with 
other countries. 
To begin with Amsterdam. The par of 
exchange between England and Holland is 
11 florins, or guilders, for a pound sterling. 
The denomination of money most usual in 
Holland is that of guilders, stivers, and pen- 
nings. 
16 pennings make 1 stiver 
20 stivers 1 guilder. 
But by a useless adherence to antiquated 
rules, another denomination of money is 
occasionally employed ; a practice always 
perplexing at first, and auk ward in some 
measure even to those who are accustomed 
to it. This denomination is called Flemish, 
and is as follows : 
12 grotes. make 1 schilling 
20 schillings 1 pound Flemish. 
Foreign exchanges are stated in this mo- 
ney, and the par with London is 36s. 8. or 
in other words eleven guilders (f 11.) 
