. Loyal citizenship. n countries has such a low exchangevalue in comparison with United States money. Checks as money. Depositors in banks generallyhave checking accounts. Instead of withdrawingactual money from banks and paying all their bills incurrency, they simply give their checks. This prac-tice is very convenient and has increased rapidly inthe last twenty years. When the manufacturer men-tioned in the chapter on Capital got a loan of$20,000, he did not receive $20,000 in coin or papermoney. He received merely a credit to that amounton the books of the bank. Against this credit hedrew h
. Loyal citizenship. n countries has such a low exchangevalue in comparison with United States money. Checks as money. Depositors in banks generallyhave checking accounts. Instead of withdrawingactual money from banks and paying all their bills incurrency, they simply give their checks. This prac-tice is very convenient and has increased rapidly inthe last twenty years. When the manufacturer men-tioned in the chapter on Capital got a loan of$20,000, he did not receive $20,000 in coin or papermoney. He received merely a credit to that amounton the books of the bank. Against this credit hedrew his checks to pay for machinery, coal, electriccurrent, water, raw materials, and wages. Thesechecks, after some circulation perhaps, were depos-ited in banks (Fig. 25). WeSTCHESTERTrUST CoMRVNY SO-S3 l/^^-^^^-t^ .^J?. ^fi^AtCZ*^ TXuid y^. Fig. 25. A bank check. By writing his name on the back of thischeck, the man to whose order it is drawn can make it payable toanother person. The Funclion of Money i:. Fio. 26. Tho cloarinp lionso for tJio hanks of a frroat city. Karlibanks representative has hrouf^ht the outside cheeks that his hankhas taken. He will exchange these for checks drawn on his hank. If a check was deposited in the l)ank on which itwas drawn, all that happened was that one mansaccount was charged and the other mans accountwas credited willi the amount of the check. I hemedium of exciianf;e in that transaction was hankcredit represented by a check. If tlie coal dealer, forexample, deposited his check willi aiiolhcr hank thanthe one on which it was drawn, the result would nothave been very different. A clerk from the coaldealers bank would simply have taken the check tothe clearing house along with the rest of tin* cliccks onother banks received diu-ing one business day. At aclearing house the clerks of all the l)anks of a cil^bring together outside checks. They then ex- 48 Loyal Citizenship change checks with one another, and only smallbalances are settled in cash.
Size: 1865px × 1340px
Photo credit: © Reading Room 2020 / Alamy / Afripics
License: Licensed
Model Released: No
Keywords: ., bookcentury1900, bookdecade1920, bookidloyalcitizen, bookyear1922
