Borrowing

“ Let it not be boasted that nine millions are paid, when a new debt of seven millions appears to be contracted; nothing is more easy than to clear debts by borrowing, or to borrow when a nation is mortgaged for the payment. ”

“ The first step in debt is like the first step in falsehood; almost involving the necessity of proceeding in the same course, debt following debt, as lie follows lie. Haydon, the painter, dated his decline from the day on which he first borrowed money. He realized the truth of the proverb, “Who goes a-borrowing, goes a-sorrowing.” ”

“ Borrowing is a sign of loss and meagre support. For a banker to dream of borrowing from another bank, a run on his own will leave him in a state of collapse, unless he accepts this warning. If another borrows from you, help in time of need will be extended or offered you. ”

“ But it is, in fact, borrowing money on a promise to pay; and in the case of the government it is borrowing upon a kind of promise to pay, which is a part of the medium of exchange, and of that which is, in the full legal sense, money.
We perceive, then, a great difference between private borrowing and public borrowing. [63] When a nation borrows it may, as we see, borrow with its currency; and if its currency be made a legal tender it may borrow with that. ”

“ I, who ne’er
Went for myself a begging, go a borrowing,
And that for others. Borrowing’s much the same
As begging; just as lending upon usury
Is much the same as thieving—decency
Makes not of lewdness virtue. ”

“ To use any one of these forms of borrowing for the purpose of financing betterments and additions is dangerous and essentially unsound. Such obligations are generally contracted during a period of prosperity and expanding business for the purpose of taking care of temporary needs. They frequently become a source of embarrassment when a period of money stringency sets in. ”

“ Chief Justice Marshall, the annexing of a quality to the promises of the government for money borrowed, which will enable the holder to use them as a means of satisfying the demands of third parties, cannot be sustained as the exercise of an appropriate means of borrowing. That is only appropriate which has some relation of fitness to an end. Borrowing, as already stated, is a transaction by which, on one side, the lender parts with his money, and on the other the borrower agrees to repay it in such form [Pg 395] and at such time as may be stipulated. ”

“ Where credit is abundant and relatively cheap, borrowers spend beyond their incomes, hoping to pay later when the loan falls due. Borrowing and over-spending are among human frailties. They are also forms of risk-taking or gambling. ”

“ Loans shall be made only for the purposes which promise to result in a saving or a profit to the borrower. Each applicant for a loan must state the object for which he desires to borrow, in order that the credit committee, which passes on all loans, may rigidly exclude thriftless and improvident borrowing. ”

“ Could he do this, borrowing would make an existing individual wealthier; but as it generally makes him poorer, it seems evident, that he pays himself the value of the use of the money be borrows. If A, having land worth ten thousand pounds, borrows that sum of B, A does not become worth twenty thousand pounds at the expense of his posterity. ”

“ Is private credit the friend and patron of industry? That most useful kind which relates to borrowing and lending is reduced within the narrowest limits, and this still more from an opinion of insecurity than from the scarcity of money. ”

“ One form of money transaction which is hardly regarded as justifiable when poor people resort to it, but which at the same time is the ordinary, laudable, business custom of rich men—namely, borrowing—is carried on by the poor under very distressing conditions. ”

“ Now let us turn our eyes from that side of the canvass, on which about ten thousand of us, out of ten thousand and one, are depicted, to the little smiling fat group which complains of a redundancy of money. Alas! say these gentlemen, money is so plenty, that we have a large sum of specie which is not currency for want of employment. Capital is so abundant as to stifle enterprise and speculation. It is so abundant, that when loans are called for, capitalists jump over each other's heads in a contest of underbidding. It is so abundant that they rejoice in the public calamity of borrowing. ”

“ The habit of borrowing was stopped with the introduction of more money into the camp, and the establishment of rates of interest; the poorer people either took what they wanted, or as indiscreetly bought on credit. ”

“ The plain fact is that wherever there is one bank that attempts to pay its debts, there must be great distress; but in those places where there are two or more, God help the people! The curse of borrowing, of suffering 'paper to do our business,' is falling heavily upon us." "With nearly $500 in notes of different sizes, and of many old and respectable banks, in his pocketbook, the writer of this article was compelled, on Saturday last, to borrow market money." "Misery abounds and the neighborhood of every bank is a neighborhood of bankrupts, positive or anticipated." ”

“ This woman must have been a mirror of neatness when compared with her dirty neighbours.
One night I was roused up from my bed for the loan of a pair of "steelyards." For what purpose think you, gentle reader? To weigh a new-born infant. The process was performed by tying the poor squalling thing up in a small shawl, and suspending it to one of the hooks. The child was a fine boy, and weighed ten pounds, greatly to the delight of the Yankee father.
One of the drollest instances of borrowing I have ever heard of was told me by a friend. ”

“ If your revenue is nine millions of dollars and your expenditure fourteen, you must borrow, you must create a new debt of five millions. But if two millions of that revenue are, under the name of sinking fund, applicable to the payment of the principal of an old debt, and pledged for it, then the portion of your revenue applicable to discharging your current expenditures of fourteen millions is reduced to seven millions; and instead of borrowing five millions you must borrow seven; you create a new debt of seven millions, and you pay an old debt of two. ”

“ Or, if a gentleman be known to spend more than his income, to mortgage his lands to take no care of his estate, or how his stewards or bailiffs manage it; if he run in debt to tradesmen and mechanicks, and be perpetually borrowing money, without any thoughts how to pay it: I say, under such management, no fair dealer will have any thing to do with them; and of course they fall into the hands of scriveners, knavish attorneys, and griping usurers; will be fed from hand to mouth, pay double and treble interest for what they receive, till their creditors watch their opportunity, and sweep all. ”

“ They are disposed to have much confidence in it, and it was the prospect of its establishment, which enabled us to set the loan of last year into motion again. They will attend steadfastly to its first money operations. If these are injudiciously begun, correction, whenever they shall be corrected, will come too late. Our borrowings will always be difficult and disadvantageous. ”

“ There can be no freedom or beauty about a home life that depends on borrowing and debt. ”

“ Wealth can only be accumulated by the earnings of industry and the savings of frugality, and nothing can be more ill judged than to look to facilities in borrowing or to a redundant circulation for the power of discharging pecuniary obligations. ”

“ If you would know the Value of Money, go and try to borrow some; for, he that goes a borrowing goes a sorrowing; and indeed so does he that lends to such People, when he goes to get it in again.—Poor Dick farther advises, and says,
Fond Pride of Dress is sure a very Curse; ”

“ If of a friend, he ceases to be one the moment you feel that you are bound to him by the heavy clog of obligation. If of a usurer, the interest, in this country, soon doubles the original sum, and you owe an increasing debt, which in time swallows up all you possess. ”

“ Property has been long set aside for the payment of that debt to its utmost farthing. My father felt that while that money remained unpaid there was a brand on himself and his family, and he has wrought, wrought as few men have wrought, to pay off, not only that, but other obligations of a sacred character. Many a bill of exchange, the proceeds of his labour, has he sent to old creditors who were in need of what he owed. ”

“ Each borrower must specify the purpose for which he wants a loan, say to buy a cow or drain a field, or pay off a money-lender, and this is rigorously inquired into. Only members can borrow. Any member, however poor, can borrow for a profitable approved purpose, and no one, however rich, for any other. Practically all the members see that the money is applied as agreed; and, while the loan is often made for a long period, a year or two—even for ten or more—so as to repay itself out of the profit, power is reserved to call it in at short notice if misapplied. ”

“ Thus the nations should become subject to them, and dependent on them, as the borrower is servant to the lender, Prov. xxii. 7. To be able to lend, and not to have need to borrow, we must look upon as a great mercy, and a good reason why we should do good with what we have, lest we provoke God to turn the scales.
II. Here is a law in favour of poor borrowers, that they might not suffer damage by the former law. Men would be apt to argue, If the case of a man be so with his debtor that if the debt be not paid before the year of release it shall be lost, it were better not to lend. ”

“ To a people in this state of feeling, a loan on interest presents the repulsive idea of making profit out of the distress of the borrower. Moreover, it is worthy of remark that the first borrowers must have been for the most part men driven to this necessity by the pressure of want, and contracting debt as a desperate resource, without any fair prospect of ability to repay: debt and famine run together in the mind of the poet Hesiod. The borrower is, in this unhappy state, rather a distressed man soliciting aid than a solvent man capable of making and fulfilling a contract. ”

“ In process of time a new class of borrowers arise who demand money for temporary convenience or profit, but with full prospect of repayment—a relation of lender and borrower quite different from that of the earlier period, when it presented itself in the repulsive form of misery on the one side, set against the prospect of very large profit on the other. ”

“ Under the operation of a shrinkage in the volume of money, this enormous mass of borrowers, at the maturity of their respective debts, though nominally paying no more than the amount borrowed, with interest, are in reality, in the amount of the principal alone, returning a percentage of value greater than they received—more in equity than they contracted to pay.... ”

“ The debt of the borrower loads his heart, cramps his hands, and dulls his labour. The gain of the lender hardens his heart, fouls his brain, and puts every means of mischief into his otherwise clumsy and artless hands. ”

“ If the borrower pays it punctually without hesitations and defalcations, without difficulties, and, above all, without compulsion, what is the consequence?—he is called an honest man, he has the reputation of a punctual fair dealer. And what then?—why, then, he may borrow again whenever he will, he may take up money and goods, or anything, upon his bare words, or note; when another man must give bondsmen, or mainprize, that is, a pawn or pledge for security, and hardly be trusted to neither. This is credit. ”

“ The farmer was chronically wanting to borrow, and his security was getting shaky. I’d like to borrow five thousand, pleaded the farmer. The banker cupped his hand to his ear and said: Speak a little louder and cut down the amount.
Thousands of girls are sent out into the world with what is called finished educations, who cannot even give a proper receipt for money, to say nothing of drawing a promissory note, a draft or a bill, or understanding the significance and importance of business contracts.
Such a woman presented a check for payment to the paying teller of her bank. ”

“ What they borrow, one may say, is commonly spent before they borrow it. They have generally consumed so great a quantity of goods, advanced to them upon credit by shopkeepers and tradesmen, that they find it necessary to borrow at interest in order to pay the debt. ”

“ To borrow under such conditions is to mortgage a declining property.
The time for a business man to borrow money, if ever, is when he does not need it. That is, when he does not need it as a substitute for the things he ought himself to do. ”

“ But, logically considered, is it not a singular fact that a man who will hasten to clear himself of monetary debt, if it be but a shilling, will deprive, shall we not say practically rob, his friend of an umbrella worth perhaps a guinea, or a book, which no money can replace, if it happen to have associations for the owner or be out of print? And this, too, in a fashion peculiarly treacherous, since he knows the object of loan would never be lent except on tacit promise of return. ”

“ Our farmers who have mortgages on their property, and who have been told that free coinage will make things exceedingly easy for them, will have some unexpected experiences. Every mortgage debt that is due will be quickly called in. The mortgagor who tries to have his bond extended will find an unwilling ear. He who seeks to borrow money in order to replace the old mortgage with a new one will be told that this is no time for loans, except, perhaps, upon exorbitant conditions. ”

“ For perhaps some creditor honestly received in the way of trade a large sum of money of the debtor for goods sold him when he was sui juris, and he by consent shall own himself a bankrupt before that time, and the statute shall reach back to bring in an honest man’s estate, to help pay a rogue’s debt. Or a man shall go and borrow a sum of money upon a parcel of goods, and lay them to pledge; he keeps the money, and the statute shall fetch away the goods to help forward the composition. These are tricks I can give too good an account of, having more than once suffered by the experiment. ”