The remarks of other authors agree pretty accurately with this statement, fixing the orders at C or D.Tho Dutch seem, of all European nations, hitherto to have been inclined to carry instruments to the most slowly returning orders.The durability given to all the instruments constructed by them, the care with which they are finished, and the attention paid to preserving and repairing them, have been often noticed by travellers.In the days when their industry and frugality were most remarkable, interest was very low, government borrowing at two per cent.and private people at three.(57) The former indicating an order doubling in about thirty-three years, the latter one doubling in twenty-three years.In ancient Rome, interest was in reality exceedingly high, from twelve to fifty per cent.(58) Were we farther to compare the orders in which instruments appear to stand in other countries, with the rate of interest in those countries, we should find the two every where correspondent.I apprehend, however, that this is needless, for, as the reader must on consideration perceive, it is impossible it can be otherwise.Loans, indeed, pass under the name of money, but money is only the means of effecting the loan, it is in reality instruments that are lent, and they must in return yield not much less than what is paid for their use, otherwise they would not be borrowed, and not much more, otherwise they would not be lent.
The system of calculation, the foundation of which we have been considering as connected with exchanges, is convenient for all engaged in the business of transfers, and answers their purposes very perfectly.When applied, however, to speculative purposes, it labors under the disadvantage to which all practical general rules are liable, when assumed as speculative general principles.According to it, stock is regarded altogether, as measured by money, and an amount of stock is considered, simply, as an amount of money, or something that will bring money.The stocks, therefore, of different countries, are viewed as differing merely in amount, and every increase and diminution of the stock, of the same country, as a simple addition, or substraction, of an homogeneous quantity.These events being so viewed, have been assumed so to exist, and the general increase and diminution of stock, have been treated of, as things, as simple in their nature, as the rows of digits employed to mark the mount of money by which they are estimated.Some of the fallacies hence arising, will be presently noted;they will, I believe, be found to be the foundation of much of the contradictions, in which the reasonings on these subjects are involved.
CHAPTER IX.OF THE EFFECTS RESULTING FROM DIVERSITIES QF STRENGTH IN THE ACCUMULATIVEPRINCIPLE, IN MEMBERS OF THE SAME SOCIETY.
The mass of the individuals composing any society, being operated on by the same causes, and baring similar manners, habits, and to a great extent feelings also, must approximate to each other, in the strength of their effective desires of accumulation.In the view we have hitherto taken of the subject, we have considered them, as not only approximating, but coinciding in this respect.In reality, however, they do not do so.Though the desire may be generally of nearly equal strength, throughout the bulk of the society, it cannot altogether be so, but must vary, in some, in degrees scarcely perceptible, in others, as in every community there will be men of characters opposite to their fellows, very largely.But there are nevertheless circumstances, which, notwithstanding these variations, restrain and confine the construction of instruments, either altogether to the same order, or to orders much more nearly approximating to each other, than would be indicated by the strength of the effective desire of accumulation, in the individuals forming them.
The accumulative principle of the different individuals composing the same society, may vary from the average strength, either by being above, or below it.There will, in every society, be some individuals not disposed to construct any instruments, but such as are of orders of more quick return than those generally formed, as there will be others, disposed, if they have no opportunity otherwise to make additional provision for futurity, to expend part of their revenue in working up materials even to orders of slower return, than the average of the instruments already formed.
Persons of the former class, possessing any amount of funds presently available, would be inclined to apply them to the formation of instruments, could they obtain materials, returning so largely as to correspond to the estimate they make of the future and the present, But they will not be able to find any such materials, for they will have been previously appropriated, and wrought up more laboriously than they would be inclined to do, by other members of the society.It; again, the funds of an individual of this class, consists of instruments whose returns are future, he will gradually transfer them to other members of the society, whose accumulative principle is stronger than his own; for, according to his estimate of the future and the present, he will receive more for them than they are worth.It thus happens, that all the members of any society, whose accumulative principle is lower than the average, are gradually reduced to poverty.The same persons, moving to a community where instruments were of orders of quicker return than those correspondent to the strength of their own accumulative principle, would acquire property.Thus the artisan, or laborer, who, in England, never thought of saving, is excited to accumulate property, in North America.
The Chinese, who, in Europe, would be very prodigals, are accounted frugal in the tropical regions of Asia, and there attain to considerable wealth.
