sfer of cash, or by issue of a clearing house
certificate that a bank has a balance in its favor, and so only a small
amount of cash is used in settling all transactions of an immense
business. The clearings of a single day reach hundreds of millions of
dollars, and form an index of the business prosperity of the country.

The system saves the risk and cost of transferring back and forth immense
amounts of coin and currency, and brings the business men of the country
into ready contact with each other. It is an essential part of the means
of settlement between different cities and different countries. A debt in
any part of the world can be paid through a draft on London, which by
means of the clearing house and its associated banks can be purchased
anywhere and paid without delay. Since the purchasing power of any part of
the world is chiefly in what it has to sell, the constant motion of checks
and drafts in opposite directions will balance each other. If there were
no long time credits, the purchases of any city would essentially equal
its sales; and so with perfect clearance all trade would be quickly
adjusted with but little use of money except for retail business.

_Other clearing systems._--So evident are the advantages of clearing houses
in banking that the system extends to many other interests. Railroad
corporations balance accounts against each other by exchange of tickets
issued by the different roads. Large combinations of dealers in implements
or other goods find a similar service available where they can work
together with confidence. Express companies sharing in a common service
divide the final proceeds upon the same principle. So evident is the
advantage that the growth has been rapid during recent years, and seems
likely to extend still further.

Some effort has been made to establish farmers' exchanges upon a similar
plan, but as yet with little success. The obstacles are chiefly in the
want of business confidence in business habits among the farmers
themselves. Since the system is strictly a credit system, exact promptness
in meeting engagements and constant dealing in the same channels are
absolutely necessary. Most farmers, having comparatively few transactions
from day to day, are loath to attach themselves as constant customers in
any association. With larger experience and more neighborly contact they
are finding it possible to work in association for various purposes, and
will doubtless enlarg