from the discount market in London, from the man in
London who discounts the draft after it has been "accepted". The
exporter in Canton gets the money direct from his banker in Canton, but
the latter is willing to let him have the money in exchange for the
draft only because he (the banker) knows that he can send the draft to
London and that some one there will eagerly discount it. In that way
the Canton banker gets his money back. The only party who is out of any
money during the time the silk is being manufactured and sold in
Paterson, N.J., is the party in London who has discounted the
shipper's draft.

The real function of the banker, then, in these Commercial Credit
transactions is to open up the international loaning market to the
importer. Through the system now in force this is accomplished by a
banker in New York issuing a credit and by a banker in London putting
his "acceptance" on drafts drawn under that credit. The combination
makes the drafts _good_; makes the great discount market in London
willing to take them, and absorb them, and advance real money on them.
And for the opening up of this great reservoir of capital the importer
here has to pay an interest rate of but from one to two per cent. per

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