The theory of credit

Front matter

CORNELL UNIVERSITY LIBRARV

1924 092 558

The date shows when this volume was taken.

Preface

It is somewhat surprising that in this great Mercantile country there is not a single treatise in the English Language which contains an exposition of the Juridical and Mathematical principles of the colossal system of Credit, together with their application in practical commerce

The Romans invented the business which, in modern language, is termed Banking. The Eoman bankers invented Cheques and Bills of Exchange : and the great Eoman Jurists of the second and third centuries worked out .the complete juridical principles of Credit : which were incorporated in the Pandects of Justinian, which were the great Code of the Western Empire : and in the Basilica, which were the great Code of the Eastern Empire : which have been the Mercantile Law of Europe for 1,600 years: and are fully exhibited in every Continental Treatise on Jurisprudence

But they have not hitherto found their way into any treatise on Political Economy, or, as it is now becoming more usually termed. Economics, in any language, except mine

It is quite easy lo foresee that the next great subject for Economical Inquiry in this country will be the anomalous Systems of Banking and Currency whicli prevail in the United Kingdom : and this work is intended as a complete Manual on the subject.

uruv: <p TV,

LONDON : A. P. Blundell, Taylor & Co., 177, Upper Thames Street.

C N T E Is^ T S

OF

THE FIRST VOXUME

CHAPTER I DEFINITION OF TEEMS 1 Definition of Economics

2 Definition of Wealth or of an Economic Quantity

3 Definition of Wealth by the Economists

4 Aristotle's Definition of Wealth

5 Three Species of Wealth : or Economic Quantities

6 Ancient Dialogue to show that Personal ftualities are

Modern Economists include Personal Qualities under Wealth 10

8 Demosthenes shows that Personal Credit is Wealth

9 Modern Economists include Personal Credit as Wealth

10 On Abstract Rights as Wealth ....

11 General Eule of Roman Law that Eights are Wealth .

12 General Eule of Greek Law that Eights aiie Wealth

13 General Eule of English Ijaw that Plights are Wealth .

14 Modern Economists class Eights as Wealth .

15 There is no such thing as Absolute Wealth .

16 Economics or Commerce consists of Six distinct kinds of

Exchange

17 On the Meaning of the word Property

18 Meaning of Property in English

19 On Right of Property and Right of Possession

20 Application of the Positive and Negative Signs to Property

21 On the Theory of the Value of Land

PAGE

13 15 17 21 22 23 25 28

28 30 33 35 35 37

VIU

Contents

22 Every Sum of Money is Equivalent to the Sum of the

Present Values of an Infinite Series of Future

Payments 39

Section II On the Origin, Source, or Cause of Value . . . 160

Investigation of the Form or Cause of Value . . . 162

Materiality is not Necessary to Value . . 162

Durability is not Necessary to Valufe .... 163

Error of the Doctrine that Labor is the (Jause of Value . 163

CONTENTS

^ 11 Examination of the Doctrine that Labor is the Cause of

Value

12 Results of the Preceding Inquiry .

13 Demand is the Sole Cause of Value

14 Error of the Expression Intrinsic Value

15 A Standard of Value is Impossible

16 But there may be a Measure of Value

17 Value only ejdsta in the Human Mind

Section III 18 On the General Law of Value : or the General Equa

tion of Economics

19 Fundamental Conditions of the General Equation of

Economics

20 Lord Lauderdale's Law of Value ....

21 Eemarks on the General Equation of Eco^iomios .

PAOB

167 175 177 180

184 186 187

190 193

12 13

14 15

CHAPTEE III

THE THEORY OF CISeDIT

Origin of the System of Credit in Europe

The System of Credit

Method of Contracting a Loan among the Romans On the Stipulatio : or Verbal Contract

On Arcaria Nomina

On the Obligatio Litteris : or Written- Contract The Obligatio Consensu : or Consensual Contract

Section I ?.05

On the Creation of Obligations ....

Division of Opinion among Jurists as to the position of the

Debtor in an Obligation 206

Advantage of adopting the Conception of Economics as the

Science of Exchanges or of Commerce .... 208 On the Errors made by some Mathematicians in terming

Debts Negative Quantities 209

Error of Euler ... .... 211

Error of Peacock 2 13

Further Error of Peacock ..... . 215

Error of Thornton and Cernuschi 217

CONTENTS XX

PAGE

§ 16 On the Application of the Theory ^of Algebraical

' Signs to Economics 220

17 All Sciences deal, with Quantities and Operations . . 222

18 Examples of the Algebraical Signs applied^ to Quantities . 224

19 The Signs + and — may also be applied to Persons who

stand in Opposite Relations to each other . . 227

20 Application of the Positive and Negative Signs to Time . 228

21 The Algebraical Signs applied to Operations . . . 229

22 Jurists also use the terms Positive and Negative to denote

Opposition . . 230

23 On the true Meaning of saying that Debts are Negative

Quantities . . 231

24 If Money be termed Positive Capital, Credit may be

termed Negative Capital .... . 233

Section II 25 On the Transfer of Credits or Debts . . . 235

26 Ou Property held in Contract : or on jura in personam . 285

27 Property held in Contract is of Two Icinds .... 287

28 On the Transfer of Credits or Debts in Roman Law . 240

29 On the Transfer of Credits or Debts in English.

Equity and Common Law 247

80 Appointment of a Royal Commission to prepare a Digest of

the Law of England .... , . 264

81 The Case of Crouch v. The Credit Foneier of England 267

82 The Case of Goodwin v. Robarts 270

33 Choses-in-action made Transferable by Statute . . . 274