dence in each other's honesty of purpose
and ability to keep correct accounts. It also requires a mutual
expectation of ability on the part of either to meet indebtedness at any
future time of settlement.

_Credit by due-bills._--An extension of this credit in well established
countries, so as to take in other persons than the two involved in book
account, is found in due-bills, notes of hand payable on demand, or more
formal securities, any of which may require a final decision in court.
These pass from hand to hand, often in connection with coin, and under
ordinary circumstances serve their purpose cheaply. In some countries a
note of hand, with endorsement of each user, may make exchanges until it
is covered with endorsements. The danger of waste is considerable from the
impossibility of knowing the financial standing and honesty of the various
endorsers, and the system is limited, of course, to the range of
confidence in such trustworthiness. So easy is it to extend this credit of
individuals beyond the range of safety that most governments have found it
necessary to protect their citizens against its dangers by limiting or
prohibiting its use as currency.

_Credit currency._--So convenient, however, and so economical is the use of
credit, that all well established nations have developed systems for the
issue of a credit currency founded upon the stability of strong
corporations or upon the national credit. Nations themselves have often
issued bills of credit in the form of notes, or promises to pay at the
national treasury. If these are payable on demand in the coin of the
realm, they are said to be redeemable. If the time of payment is
uncertain, or indefinitely postponed, they are said to be irredeemable.
Thus we have the many forms of paper money so familiar to everybody and
the various practices and speculative theories regarding it, which make a
large part of the discussion of financial questions throughout the world.

No one doubts the worthlessness of currency in any form of note, from
individual or firm, which cannot be paid when presented. The notes of the
government, so long as that government is considered stable, may circulate
readily, and even after doubts exist as to the final ability of the
government to redeem, they still circulate, perhaps with greater
readiness, in the feeling that hoarding is utter loss and the stopping of
trade in the ordinary perishable products of industry will be an enormous