The work of the Stock Exchange

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Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter VII. Credit transactions in securities

Collection:: Economics Books

176 THE WORK OF THE STOCK EXCHANGE modity whatsoever, is simply an exchange of money and goods. For this reason, strange though it may sound, it would from a purely economic standpoint be quite correct to speak of buying $75 with a ton of steel, or selling $60 for a suit of clothes. Owing to our constant use of money as the measure for all values, however, we habitually think of every sale in terms of money rather than in terms of goods. Sales for Cash and on Credit.—Sales can be divided into two general classes, depending on whether or not they involve the element of credit. In an outright or cash sale, the buyer immediately pays his money and the seller at once delivers his goods. Since there is no delay on either side of the transac- tion, credit—which is simply a substitute for money or goods in the form of a promise either to pay the one or to deliver the other at some future time—is in no way involved. Yet cash sales undoubtedly furnish a smaller part of our daily business turnover today than do sales on credit. Indeed, the use of credit had come to constitute a vital factor in business even before the creation of our modern stock exchange or banking systems. If by some economic miracle credit transactions could be wholly abolished, our entire modern financial system would at once degenerate into the crude business of money-changing from which it rose centuries ago. All modern governments, by their issuance of both bonds and fiduciary paper currency, show how completely dependent they are upon the use of credit. As for commerce and industry, neither has been wholly upon a hasis of cash payment and immediate delivery since the eco- nomic stagnation of the Dark Ages—if, indeed, they were even then. It is, consequently, no exaggeration to say that without the invention of the credit machinery which in modern times permits the deferred payment of money and the deferred delivery of goods, the vast material and spiritual progress of the human race since the twelfth century would have been utterly impossible.

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