126 
POLITICAL ECONOMY 
the promise to provide an article serves 
the purpose of the article. The promise of 
a loaf of bread will not satisfy hunger, but 
the promise of so many sovereigns in the 
documentary form of a cheque or a note may 
satisfy the requirements of people as com 
pletely as sovereigns, and consequently enable 
exchanges to be made. It is essential, of 
course, that the public should place implicit 
trust in those who make the promises, that is 
in the persons or institutions issuing the paper 
money. Were such undertakings not met 
when their fulfilment was asked for, this 
trust would be destroyed. Consequently it is 
essential, if bank-notes are to circulate freely, 
that the bankers responsible for them should 
hold such reserves of bullion that nobody who 
wanted a note changed into gold would find his 
request refused. 
How much these reserves should be at any 
given time it is not easy to say, but bankers 
know from their experience what is the safe 
limit ; and it is possible to point to the 
influences whereby the normal ratio of credit 
money to standard money (that is, coins 
of the money commodity) circulating in the 
country is determined. When the public 
is entirely without doubt as to their safety 
in accepting paper in payment of debts, paper