74 
MONEY 
in the total stock which we have agreed to call the 
supply, whereas, having actually been destroyed, 
they no longer appear in the total. Consequently, 
it is more convenient to follow ordinary usage in this 
matter, and speak of banks and governments which 
buy up and burn currency as reducing the supply. 
The analogous case in regard to houses is when 
houses are bought up by some person or institution 
for demolition. We think of this as causing a 
reduction of supply rather than an increase of demand. 
To clear up our ideas about the demand for 
currency, let us think of a few obvious causes of 
increase and decrease of demand for it. 
The most obvious cause of increase of demand for 
a currency is an increase in the number of persons 
who use it. At a very early age—often at his or her 
christening—each new member of the human race 
begins to hold a small quantity of currency, and the 
child of six sometimes has more than his father or 
mother. There are plenty of examples of increase 
of demand from this source having been sufficient to 
cause a noticeable increase in the value of a currency 
which is limited in amount—the Indian rupee after 
the closing of the Indian mint and the American 
greenback are often quoted, and the general increase 
of gold and silver-using populations, though it has 
not actually raised the value of gold and silver 
currencies, has at any rate obviously prevented them 
from falling as fast as they would otherwise have 
done. The great rise of prices after the Black Death 
may be given as an example of the converse effect 
of diminution of population in diminishing the 
demand for, and consequently the value of a currency. 
The introduction of anything which economizes 
currency, i.e. which makes it unnecessary for people 
to keep so much currency by them on the average, 
tends to diminish the demand for currency. The