erchant in Argentina
sells wheat to an English buyer, he draws a bill on the buyer (or some
bank or firm in England whom the buyer instructs him to draw on),
saying, "Pay to me" (or anybody else whom he may name) "the sum of so
many pounds." This bill, if it is drawn on a firm or company of well
known standing, the seller of the wheat can immediately dispose of, and
so has got payment for his goods. Usually the bill is made payable two
or three, or sometimes six months after sight, that is after it has been
received by the firm on which it is drawn, and "accepted" by it, that is
signed across the front to show that the firm drawn on will pay the
bill when it falls due. These bills of exchange, when thus accepted, are
promises to pay entered into by firms of first-rate standing, and are
held as investments by English banks. Bills of exchange are also drawn
on English houses to finance trade transactions between foreign
countries, and also as a means of borrowing money from England. When
they are drawn on behalf of English customers, the credit given is given
at home, but as it is (almost always) given in connection with
international trade, the transaction may be considered as part of
international finance. When they are drawn on behalf of foreign
countries, trading with other foreigners, or using the credit to lend to
other foreigners, the connection with international finance is obvious.
They are readily taken all over the world, because all over the world
there are people who have payments to make to England owing to the wide
distribution of our trade, and it has long been England's boast that
bills of exchange drawn on London firms are the currency of
international commerce and finance.

Some people tell us that this commanding position of the English bill
in the world's markets is in danger of being lost owing to the present
war: in the first place because America is gaining wealth rapidly, while
we are shooting away our savings, and also because the Germans will make
every endeavour to free themselves from dependence on English credit for
the conduct of their trade. Certainly this danger is a real one, but it
does not follow that we shall not be able to meet it and defeat it. If
the war teaches us to work hard and consume little, so that when peace
comes we shall have a great volume of goods to export, there is no
reason why the bill on London should not retain much if not all of its
old prestige and supremacy in t