MR. MANUFACTURER: We must have done so, for we have not yet struck a single point upon which we have not unanimously agreed. Let us hope that we shall be as successful in the future. At present, I must say I am a little dubious about the results of tonight's discussion, for I have run up against a snag or two, which I half fear will stump Mr. Banker, when he tries to pull them. However, he has been pretty successful so far in holding his own, and he may surprise us tonight.
MR. BANKER: I have no desire, or hope, of surprising you, but I have perfect confidence in convincing all of you, that there is only one system of currency for us to adopt, or even think of adopting, and that is a pure Credit Currency.
Let us assume that two men, A and B, who are of equal and unquestioned standing in some country town, start in the banking business at the same time.
A begins by taking the deposits of his neighbors, and continues until he has received $100,000, and has loaned the same out to the people of the community. He now owes $100,000 subject to check, and he has $100,000 owing to him, as he has loaned out all his deposits.
B starts a banking business, but upon an entirely different plan, or basis. He takes no deposits in the ordinary way, but if anyone comes to him desiring to borrow, or sell him promissory notes, he will lend his credit, and take all good notes and checks offered him, and in exchange give his own notes in such denominations and form as are suitable for circulation as currency, until he has exchanged $100,000 of his notes for $100,000 of the notes of the same people who have borrowed the $100,000 from the other banker.
Now, this is not a strange thing for B to do, because the bankers of Scotland did this for one hundred and forty years before they took deposits subject to check.
Now, let us return to A and B. As a matter of course, some of these notes of B will be deposited in A's bank, and B will have taken in some of the checks on A's bank. At 10 o'clock each morning A and B meet; A presents B's notes for redemption and B presents checks upon A for redemption, and the one pays the other the difference. Sometimes the balance is due to A and sometimes it is due to B. At the end of six months or a year, it will be at a stand off. A has paid B as much as B has paid A.