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3Of Credit good & bad, & of the usefulness of the former.

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[3] Mr P. allows that paper credit may be used sometimes as a cordial in cases of necessity but not as constant food & reccons the first Exchequer Bills issued out in the late warr to be of this kind & that it may be convenient upon pressing occasions to make us of the same method thereafter provided such Bills be issued out upon some fund & not for more then the tax may yield & be paid off when the money comes in. For, saith he, the danger of using paper as money does not arise from the immediate use of the paper but from the misapplication of that deposit & for that reason he advises that as such paper cannot be finally discharged but by payment of coyn so care should be taken to preserve coyn in the nation for that purpose. He saith also that as such a way of giving a supply to the publick may be convenient in cases of necessity so it may be necessary to have a Bank in the City for the keeping of money & the ease of making payment by assignment, but in no case to allow of Notes & Bills to pass as money unless a deposit be secured. By all this he allows paper credit wherever the security is good, & so far I agree with him. I agree with him also that where the deposition is in danger of being withdrawn the security is bad & the paper credit unsafe & such paper credit (not good circulating security) I would compare to counterfeit < insertion from f 632r > money & say that it may be sometimes used as a cordial ins cases of necessity (like the brass money of King Iames in Ireland) but is not to be used as constant good. This sort of Paper credit Mr P. seems to understand when he compares it to counterfeit money & says that it is to be used only as a cordial. For he speaks of credit where the deposit is in danger of being withdrawn.

So then the dispute against Paper Credit in general is at an end & the Question which remains is only about the goodness of the security of the safety of the Deposit on which this or that sort of Paper credit is grounded.

Credit upon a standing Bank if equal value is allowed to be good

And Credit upon land security is as good

And so is credit upon Parliamentary funds so long as the Government lasts & there is but money enough of our own to pay Taxes. Of this kind are Exchequer bills, Bank of England Bills, Mault Tickets, Million Lottery Tickets, Annuity Tickets &c But this security is weakened by the stocks of Forreigners in those funds. Five millions of money by circulating will pay a debt of 20 millions to our own people, but it will not pay a debt of six millions to Forreigners.

The credit of particular Merchants is more apt to fail then that of parliament & yet must be tenderly dealt with because of the life of their trade

But Mr P represents &c < text from f 631v resumes >

And so the Question which remains is only about the goodness of paper credit on that several sorts of security.

Credit upon a standing Bank of equal value is allowed to be good.

And Credit upon land security is as good.

And so is credit upon Parliamentary funds so long as that Government lasts & there is but money enough to pay Taxes. Of this kind are exchequerBills, Bank of England Bills, Mault Tickets, Million lottery Tickets, Annuity Tickets &c † < insertion from the left margin > The credit of particular merchants is more apt to fail & yet must be tenderly dealt with because the life of their trade.

But Mr P. represents &c

< text from f 631v resumes >

I recommended credit for lowering Interest, because low interest is to the advantage of trade & business: Mr P. replies that the argument may be as good for limiting the rates of letting land because the cheapness of provisions may as much encourage trade as the cheapness of provisions. I answer that if provisions be cheap & other commodities dear the landed man will soon be beggared. Care must be taken of our land & native product as well as of our trade & paper credit is good for both. By lowering interest it raises the price of land & furnishes all the busy part of the nation (thus ba{illeg}dmen Grasiers {Artificers} Shopkeepers, Merchants) with money at easy rates to carry on their several imployments & is good for every body but the idle Vsurer & them that cannot live but upon the interest of their money. It may prejudice Orphans who are to live upon the interest of their portions, but its good for the nation in general & may enable father to provide better for their children & the publick is most to be regarded.

The Question about paper credit is comparative. The arguments against it must not be considered alone but compared with the arguments for it & judgment given on the weightier side.

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p. 10 l. 20 to p. 12 l 23 against the circulation of credit.

p 12 l 23 — p 16 l. 2 against more credit.

p 16 l 2 — p 17 l 27 What credit allowable & how long

p 17 l 27      p 19 l 9 Care to {be} taken against exporting our coyn.

There might be a third or 4th part fit for culling but all Importers did not cull & among the Guineas of King Ch. & King Ia. there are still many of full weight notwithstanding the wearing. If I should allow a fift part to be culled out & recoyned there would remain 7121952li. 15s. 06d. To which add the Guineas coyned from Decemb 31 1699 to              amounting to          & the Lewid'ors & Spanish Pistoles which are now recconed at a million & an half & the whole gold coyn will be above 8800000li in the nation besides broad gold & if I say but 8$\frac{1}{2}$ millions as I did {in} my former paper there will remain a wast of above 300000li to answer small objections.

[4] If any gold hath been bought with the clippings of silver monies melted down into Ingotts & exported, 'tis allowed for in my former paper 5$\frac{1}{2}$ millions wast of the silver monies

[5]And the like is to be said of gold brought in by Forreigners to get by loans upon publick funds &c. For since the year 1694 we have paid our forreign debts in any thing but gold. And such debts which now remain unpaid, are not to be considered in recconing the quantity of monies now in the nation, but must be accounted for in the ballance of trade which at present is on our side.

All which being considered I do not see but that the recconings I set down in my former paper come neare the truth vizt that in the year 1689 when we were richest we had {ab}out 12$\frac{3}{4}$ millions in silver monies (not in tale but standard value) & about 5$\frac{1}{4}$ millions in Guineas & Pistoles, in all 18 millions besides broad gold. And in the year 1700 we had about 7$\frac{1}{4}$ millions in silver monies milled & hammered & about 8$\frac{1}{2}$ million in Guineas & Pistoles besides broad Gold & the Guineas coyned 1700, In all we had about 15$\frac{3}{4}$ millions which is about 2$\frac{1}{4}$ millions less then before. In making this estimate I do not pretend to be exact. Where I could meet with exact recconings I found them & in the rest I used the best of my judgment.

All which is as much as to say that paper may be lower interest but is not a natural way of doing it because it tends to enlarge bad trades which export our money & when the money is gone the want of it will advance the rates of Interest.

[1] p. 13

[2] p 13

[3] p 16

[4] p 5

[5] p. 5, 6