Moneyed interest

“ You will see immense sums brought to light which are at present yielding nothing, and which would be gladly exchanged for productive securities bearing annual interest, when once it is felt that the payment of that interest is certain, and that the capital will not be endangered. ”

“ Another man unable to see below the surface of things and distinguish association from causation! The friends of cheap money do not claim that low interest insures high wages. What they claim is that free competition in currency-issuing and the consequent activity of capital insure both low interest and high wages. ”

“ In short, they do not know how to use their money; they tell you they are in debt, and, though that may be true, it is not true that they will use the money you give them to pay what they owe. They take no thought of the morrow; they will agree to as high a rate of interest as may be asked, and with your money they will buy a hemp-field or a set of furniture so as to astonish their neighbours and make them jealous. ”

“ I set aside the outcry against the interest yearly paid to foreigners, as the produce of the sums vested by them in the funds, because I think ruin impossible, where the money borrowed at 4 or 5, is laid out at an interest of 6, 7, or even 10 per cent. ”

“ The rate of interest, which the capitalist will demand, will depend upon a variety of circumstances, and especially upon the risk of loss attendant upon the loan-in other words, upon the character of the security offered by the borrower for the payment of the loan. ”

“ And capital having the power of bringing an unearned income as long as money is thus blessed, I still hold that justice is not attained until the gross interest is reduced to the rate of risk and cost of making loans, the cost of making the tokens being defrayed by public contributions. ”

“ If you have to borrow money to complete or perfect some transaction or business deal, or to carry you through, or tide yourself over some delay, you can always get it at the regular rate of interest, provided you have reputation, and security. ”

“ The objections usually urged against credit-money are considered and found untenable, the claim that interest naturally accrues to capital is disputed at each successive stand-point, and in the concluding remarks an explanation is given of the present excess of supply over the demand of commodities and service, confirming the conclusion that the correction of this abnormal state is contingent upon the financial measure suggested. ”

“ I have yet seen no feasible method by which credit or debt can serve safely as money, nor any honest way in which fiat money can be put in circulation. It appears to me now that, while men seek credit, they will have to pay interest, and that only by restoring opportunity to those who are now denied it by our monopolies of land, of money, and of public franchises, and so relieving them of the necessity of borrowing, can we hope to mitigate the evils of our money and trade iniquities. ”

“ In admitting that the interest of money is a legitimate thing, is one obliged also to admit that the money-lender has a right to fix the rate of interest as high as he wishes? Beyond a certain limit, will not the interest become what we call usury? ”

“ THE WISE MAN,
who, instead of buying on time and paying eight per cent. interest, saves his earnings and puts them out at eight per cent. interest, thus reaping a difference of sixteen per cent., or nearly one-sixth of his yearly surplus. Every idea put into your head is invested at interest. Every expenditure of time which is a waste is a payment of interest, a corroding, double-acting agency of evil to your welfare. ”

“ Interest is determined by the amount of capital seeking investment in loans, relative to the demand, and in a time of relative contraction of the volume of money, and consequent falling prices, will, as a rule, be low, since there is less inducement for men to borrow capital to engage in business, and more men wishing to lend. ”

“ The money in the hands of lenders, in common with all other money, will be enhanced in value, that is, there will be a greater amount of real capital seeking borrowers; while the real capital wanted by borrowers will be only the same as before, and the money amount less: the rate of interest, therefore, will tend to fall. ”

“ 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 than in equity they contracted to pay and oftentimes more, in substance, than they profited by the loan. ”

“ Let us next examine the principles which prevent the monied men from committing extortions, and which oblige them to lend their money for that rate of interest which is in proportion to the profits upon trade and industry. ”

“ Those men in business who call themselves financiers say that money is "worth" 6 per cent, or 5 per cent, or some other per cent, and that if a business has one hundred thousand dollars invested in it, the man who made the investment is entitled to charge an interest payment on the money, because, if instead of putting that money into the business he had put it into a savings bank or into certain securities, he could have a certain fixed return. ”

“ The lowest ordinary rate of interest must, in the same manner, be something more than sufficient to compensate the occasional losses to which lending, even with tolerable prudence, is exposed. Were it not more, charity or friendship could be the only motives for lending. ”

“ In order to raise the value of our money, which depends on the time of its redemption, we have recourse to a measure which removes its redemption to a more distant day. Instead of paying off the capital to the public creditors, we give them an enormous interest to change the name of the bit of paper which expresses the sum due to them; and think it a piece of dexterity in finance, by emitting loan office certificates, to elude the necessity of emitting bills of credit. ”

“ This is what government has uniformly done in its proposals for raising money.—Were I to desire any sum to be lent me without interest, offering as a compensation or premium an annuity for a given term, or an advantageous contract; the proposal would not be accepted, unless the annuity or the contract was worth the sum to be lent; and I should make myself a debtor to the purchaser for the very thing which I sold to him.—The absurdity would be the same, if instead of borrowing without interest, I should in the same way borrow at a low interest. ”

“ Eliminating from interest the element of insurance, and regarding only interest proper, or the return for the use of capital, is it not a general truth that interest is high where and when wages are high, and low where and when wages are low? ”

“ The government obtained a large sum at the time, with the necessity of only paying a small sum every year for interest; investors obtained a remunerative use for their money, and if they should need the principal, some one else was always ready to pay its value to them for the sake of receiving the interest. ”

“ You took that old sideboard for a debt—yes, a debt at 18 per cent. interest. You don't pay a cent of taxes. You sing psalms and wear out your trousers on the platform at the prayer-meeting, and then loan out the church's money on worthless securities. You're too mean to keep a cat, for the cost of her milk. You read a penny newspaper and take books out of a circulating library. ”

“ That a wise lender wishes to secure for his money the safest investment carrying the highest possible rate of interest; the rate of interest being however subordinated, in his mind, to the safety of the investment. ”

“ Again: he, who sells upon credit, asks a price, for what he sells, equivalent to the principal and interest of his money, for the time he is to be kept out of it. Therefore, he who buys upon credit, pays interest for what he buys; and, he who pays ready money, might let that money out to use. So, that he who possesses any thing he has bought, pays interest for the use of it. ”

“ They need money, capital, and they borrow it, because they can derive a benefit from its use, much beyond the interest which they pay. They borrow at six per cent of the bank, although the value of money with them is at least as high as eight. Nevertheless, although they borrow at this low rate of interest, and although they use all they borrow thus profitably, yet they cannot pay the interest without "inconvenience and distress" ”

“ Persons have money lent out at 25 per cent. You see where such enormous profit can be made by the use of money; those who once get hold of any, either by loan or otherwise, are very loath to pay it back again, and perhaps would not care ever to pay it, if it were not for the interest charged. ”

“ It is clear, that when the rate of interest is increased, the gains of money-lenders are augmented, and the money gained will buy a greater quantity of property and [Pg 90] labor. The increased gains of the lender must be paid by the borrowers, by the productions of their own or of others' labor. ”

“ We may even conceive a people whose habits were such, that in order to induce them to lend, it might be necessary to offer them a rate of interest fully equal to the ordinary rate of profit. In that case, of course, the productive classes would scarcely ever borrow. ”

“ The critics of stock-watering or of the capitalizing of surplus earnings say that it is in substance exacting money from the people, creating an indebtedness representing the same, and making this the basis for forever asking the public to pay interest upon their money so exacted. ”

“ If the people should give to landholders, as a right, what they now give to bondholders as a special privilege—why, you might loan ploughs for a price, but the price would not include a money cost, as is inevitable under our present monetary system. ”

“ The increase of lenders above the borrowers sinks the interest, and so much the faster if those who have acquired those large sums find no industry or commerce in the state, and no method of employing their money but by lending it at interest. ”

“ The consequence of this ambiguity is, that as soon as scarcity of money in the latter of these senses begins to be felt,—as soon as there is difficulty of obtaining loans, and the rate of interest is high,—it is concluded that this must arise from causes acting upon the quantity of money in the other and more popular sense; that the circulating medium must have diminished in quantity, or ought to be increased. ”

“ On the other hand, the capital owned by persons who prefer lending it at interest, or whose avocations prevent them from personally superintending its employment, may be short of the habitual demand for loans. It may be in great part absorbed by the investments afforded by the public debt and by mortgages, and the remainder may not be sufficient to supply the wants of commerce. ”

“ But, you will ask, how can money be procured or increased fast and without trouble in a country where there is no commercial enterprise, where labour is interfered with, where capital cannot have a free outlet or investment? An opening has to be found in illicit ways of procuring wealth, and the most common form adopted is the loan of money at high interest on ample security. ”

“ For it is really capital that is borrowed, and not money, the latter being only the means for obtaining the former, as money would be worthless if it could not be exchanged for the capital needed. We see already that, as the loanable capital of a country increases, the rate of interest diminishes, and when the accumulated wealth of the world becomes large enough no one will pay interest. ”

“ In a money economy those who have cash use it to pay their bills or settle their accounts.
Those who buy on credit pay interest to money lenders. The money lenders, later the bankers, make their profits by helping others to spend beyond their own means. ”

“ To modern society it seems the most110 natural thing in the world that money should earn interest. Nowadays, the number of those who lend or invest capital in the countless ways offered by modern finance is infinite. Every one of these big and little capitalists, who possess State bonds, shares in railways or industrials, or bank or commercial securities, would be thunderstruck if anyone told him that he was behaving in an unseemly way. ”

“ The preceding account will, I fancy, help to shew what is practicable, taking things as they are, in borrowing money for public uses. It proves, that the nation loses greatly by the low price of all capitals bearing a higher interest than 3 per cent. ”

“ The disposable capital deposited in banks, together with the funds belonging to those who, either from necessity or preference, live upon the interest of their property, constitute the general loan fund of the country ”

“ This Proposition better pleas’d those wealthy Citizens, than if we had plaid the Hucksters with our Commodities, wherefore two of the most wealthy and greatest account amongst them bought all, paying us ready money without a penny Credit. After that every man had received his share or dividend proportionably, and according to a general Agreement; we divided our selves into parties as Interest or Inclination lead us. ”

“ That it was in the nature of downright repudiation to pay off in depreciated paper money, bonds which had been sold and purchased with the understanding that they would be paid, principal and interest, in coin, no fair-minded man would deny. ”

“ It is meant, however, that the money-lender is entitled to no share in any increased productiveness of labour during the lifetime of his loan, beyond the interest stated. He gets his share of such increased productiveness through the higher interest he will subsequently receive in re-loaning his capital. ”

“ But in such cases there is a regular rate of interest fixed by law as payment for the use of the money borrowed. You can not risk any other than the legal rate of interest, if you do you are taking unwarranted risks, and subjecting yourself to the yoke of a loan shark, out of whose clutches you can never emerge without tremendous sacrifices, often ruin. ”