Money

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Monograph

Identifikator:: 1819853969

URN:: urn:nbn:de:zbw-retromon-207464

Document type:: Monograph

Author:: Cannan, Edwin http://d-nb.info/gnd/118666916

Title:: Money

Edition:: 6. ed.

Place of publication:: [London]

Publisher:: King

Year of publication:: 1929

Scope:: XII, 120 Seiten

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Part I. General principles

Collection:: Economics Books

VALUE OF NOTES 43 commonly called, is not essential in order to make notes circulate is shown by the fact that notes which the issuers will not in fact redeem and which are therefore called *“ inconvertible ”” notes will circulate, and an inquiry for the cause of their circulation shows it to be a demand, although often what is called “an artificially created demand,” for notes. In order to be able to put convertible notes into circulation an individual, or company of individuals, must have a considerable reputation for solvency. Notes not payable on demand but only payable at some future date without interest will not be accepted even from a solvent person or institution at their face value, and if issued at a discount so that they bring interest, they will not pass from hand to hand like coin and ordinar - notes, because the discount at which they must be taken is always diminishing. Notes not bearing interest and not payable either on demand or at anv “-*ure time, if offered by an indivi- dual or comr:—~ . +*he most undoubted solvency as somethin~ ne~ 1d fresh, would only be laughed at. But when notes have got into circulation as con- vertible notes and people have become thoroughly accustomed to accept them and to find them accept- able by others, their convertibility may sometimes be taken away without destroying this general acceptability of the notes and the consequent demand for them. Of course, if the public receive a rude shock by being told that such and such a bank is insolvent and its assets will not be sufficient to pay its notes in full, the notes will cease to be acceptable. But some less Jisquieting explanation may be given for “ thecuc-- -- cf convertibility. If the Bank of Engl. . . A -aken pains to make it known all over tie cuunury that it could not continue to pay geld cein for its notes on account of the insufficiency

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