CONTENTS

CHAPTER

I. PUBLIC AND PRIVATE FUNDS

PAGE

3-11

Ex-

Property, 3. How property is acquired, 3, 4.

change the chief method of acquiring property, 4, 5.

Importance of funds in business, 5. What is business,

5, 6. Necessity for law and order in business, 6, 7.

Business law, 7, 8. Elements of success in business,

8-10. Funds a necessary part of business equipment,

10. Funds, the subject of finance, 10, 11.

II. MONEY FUNDS

12-32

Definitions-funds, 12-14. Two forms of funds, 14.

Essential characteristics of money, 14, 15. A money

fund must admit of divisions into units, 15, 16. Money

funds must be uniform in quality, 16. Money funds.

must have durability, 16, 17. Money funds must admit

of being carried about, 17. Skins, 17, 18. Dried fish,

18. Live stock, 18. Agricultural products, 18, 19. Ad-

vantages and disadvantages in the use of these forms

of money, 19. The base metals, 19-21. Ornaments,

21, 22. Gold and silver, 22, 23. The development of

a standard, 23-25. The decimal system, 25, 26. The

"dollar" the central fact in our system, 26, 27. Gold

coins of the United States, 27. Silver coins of the

United States, 27, 28. Minor coins, 28. Paper money

in circulation, 28-31. United States notes or green-

backs, 28. Gold certificates, 28, 29. Silver certificates,

29. Currency certificates, 29. Treasury notes of 1890,

29, 30. Fractional currency notes, 20. Old demand

notes, compound interest notes, 30. National bank

notes, 30. Federal Reserve bank-notes, 30. Federal

Reserve notes, 30. The uniformity of value in our sys-

tem, 31.

III. CREDIT FUNDS

33-58

Definition of credit, 33. Credit as current funds, 34,

35. A credit purchase, 35, 36. Credit arises out of

CHAPTER

IV.

exchange, 36, 37. The principles of exchange as ap-

plied to credit, 37. Value and price of credit, 37, 38.

Basis of credit judgment, 38. Ability to obtain money

for future delivery, 38, 39. Business integrity, 39.

The result of favorable judgment-confidence, 39. Se-

curity, 39, 40. Relation of security to credit, 40. A

short sale of flour, 140, 141. Settlement of the short

sale of wheat, 41, 42. A short sale of money, 42, 43.

Rules of settlement the same as in case of short sale of

wheat, 43, 44. A corner on money-financial distress,

44. Bank-notes, 46-48. Bank accounts-deposits, 48.

Emergency currency, 48-51. Emergency funds, 51-55.

Public emergency currency, 55-58. Current credits, 58.

Mutual credit, 58.

INSTRUMENTS OF TRANSFER OF CREDIT FUNDS 59-82

The customer's check, 59. Form and significance of a

"customer's check," 59, 60. How to make out a "cus-

tomer's check," 60. Date of check, 60, 61. Filling in

the amount, 61, 62. Entering the name of the payee,

62, 63. Checks should be numbered, 63. The "check-

book," 63. Drawing check to oneself, 63, 64. Checks

drawn to oneself for special purposes, 64. Checks

drawn to others for special purposes, 64, 65. Safety

devices in checks, 65, 66. Receipts used as checks, 66,

67. How to authorize others to draw on one's account,

67. The crossed check, 67-69. The cheque-bank check,

69, 70. Other instruments of transfer of credit funds,

70. The "certified" check and the "cashier's check," 70-

72. The letter of credit, 72-76. The "traveler's

check," 76-78. The interchangeable bank money-order,

78-79. Place of credit in modern finance, 79-82.

V. FUNDS OBTAINED BY GIFT AND "EXPROPRIATION" 85-94

Primitive economy. The family, 85-86. The class and

the tribe, 86. Other non-industrial groups, 86-87.

"Gift" the funding method of dependents, 87-88. "Gift"

and contribution usually take the form of funds, 88.

Funds obtained by "inheritance," 88-91. Laws of inher-
itance, 91-93. Funds obtained by "expropriation,"

93-94.

VI. FUNDS OBTAINED BY EXCHANGE

95-115

Limit to funding power, 95-96. Capitalists, 96. What

may be offered for capital, 96. Saving, 97. Importance

CHAPTER

of training, 97, 98. Sale of goods produced by labor,

98, 99. Sales of property not adapted to capital em-

ployment, 99. The sale of one business interest to cap-

italize another, 99, 100. The sale of business interests,

100, 101. Sale of partnership interest, 101. The sale

of corporate shares, 101, 102. Capital stock, 102-104.

Stock certificates, 104. Difference between corporation

and partnership, 104-106. Financial advantage of the

corporation, 106. Common stock, 107, 108. Preferred

stock, 109-111. Kinds of preferred stock, 112. First

preferred and second preferred, 112. Cumulative and

non-cumulative preferred, 112-114. Trust certificate,

114. Other forms of stocks, 114, 115.

VII. FUNDS OBTAINED BY SALES OF COMMERCIAL CREDIT,

116-158

The extent of credit uses by the laboring man, 116-118.

The man with property, 118. Promissory note, 118.

Form of note, 118-125. As to parties, 118-120. Words

of transferability, 120-121. As to promise, 121-123. As

to date of making a note, 123, 124. As to signature,

124. A "marks" signature, 124, 125. Non-essential

clauses, 125, 126. "Without defalcation,” 125. "Credit

the drawer," 125, 126. Parts of note containing con-

tracts of security, 126-128. Personal security, 128-130.

Accommodation signature, 128. Indorsement, 128,

129. Without recourse, 130. Guarantee note, 130, 131.

Collateral note, 131, 132. Memorandum collateral note,

132-133. Judgment note, 133. Judgment note with

power of attorney, 133-135. Presentation for payment,

135. Part payment, 135, 136. Legal-tender, 136. Non-

payment of note, 136-137. Notice of non-payment, 137.

Waiver of demand and notice, 137, 138. Protest, 138-

141. Notice of protest, 141. Advantages and disad-

vantages of using promissory notes, 141-143. Accounts

stated, 143, 144. Accounts settled, 144, 145. Accounts

paid, 145, 146. A set off, 146. Due-bills, 146. Com-

mercial drafts, 146-148. Foreign bills, 150, 151. Sight-

bills and drafts, 150. Time-draft, 150, 151. Security

for acceptance and payment of drafts, 151-153. A doc-

umented bill, 153-157. Secured drafts used as funds,

157-158. Non-payment and protest, 158.

VIII. FUNDS OBTAINED BY SALES OF LONG-TIME

PAPER

Form of long-time credit, 159, 160.

159-208

Illustrations of

CHAPTER

difference in forms and uses of long and short-time

paper, 160-163.
Classes of long-time credits, 163.

What is a "mortgage"? 163-165. Mortgage contracts

one of sale, 165. Mortgage without separate note, 165-

167. Accommodation mortgage, 167. The indemnity

bond and mortgage, 167-169. Chattel mortgages, 169.

Farm mortgages, 170. Mortgages on "business prop-

erty," 170-172. Mortgages on mines and timber lands,

172. Parti-mortgage receipt, 172-174. The collateral

certificate, 174. Bonds, 174-177. The trust company as

agents of sale and transfer, 177, 178. Unsecured bonds,

178-181. Bonds distinguished from notes, 182. Security

of bonds, 182-185. Trustees of bond security, 185. Who

may be trustee of a bond issue, 185. How corporate

bonds differ from corporate shares, 185-187. Guar-

anteed and indorsed bonds, 187. Bonds based on lien

security, 187-195. Real estate bonds, 187. General

mortgage bonds, 187-189. Blanket mortgage, 189. Con-

solidated mortgage, 189. Divisional bonds, 189. Col-

lateral trust bond, 191. Equipment bond, 191. Car-

trust bonds, 191, 192. Debenture bonds of financial

companies, 192, 193. Railroad debenture bonds, 193,

194. Income bonds, 194, 195. Bonds classified accord-

ing to their purpose, 195-197. Gold bonds, 197. Legal-

tender bonds, 197. Coupon bond distinguished from

registered bond, 197. Redeemable bonds, 197-199. Con-

vertible bonds, 199. Payment and extension of bonds,

199. Security of receivers' certificates, 201-203. The

advantages of receivers' certificates, 203. Certificates of

indebtedness with no due date as to principle, 203-206.

The lease as security, 206, 207. The uses of the lease
by credit stores, 207. Dangers of lease purchases,
207, 208.

IX. THE UNITED STATES TREASURY

213-230

Relations of government to modern systems of finance,

213, 214. Coinage, 214. Providing for a complex sys-

tem of money, 214, 215. Maintenance of a standard,

215. By redemption of inferior coins, 215, 216. By

redemption of paper money, 216. The United States

Treasury, 216, 217. History of the Independent Treas-

ury, 217-219.
Our money system a refined system of

credit, 219, 220. Bank credit money, 221, 222. Actual

payment of gold not usually demanded, 222, 223. Im-

portance of gold standard, 223, 224. Maintenance of

CHAPTER

integrity of our money, 224. The Mint a money factory,

224-226. Relation of the Revenue Department, 226, 227.

Gold and other money assets of the Treasury, 227-229;

Taxation, 228. Sale of assets of Government, 228, 229.

Government borrowing, 229.

X. THE COMMERCIAL BANK

231-249

Necessity for current funds in industry, 231, 232. Ob-

stacles to business without a bank, 232, 233. Bank fur-

nishes current fund in the form of "bank credit," 233.

Exchanges "bank credit" for money, 233, 234. Allows

its customers to convert "business credit" into "bank

credit," 234, 235. Serves as agent for the presentation

and collection of "business credit," 235. Acts as trus-

tee, 235, 236. Sells exchange, 236, 237. Buys and sells

foreign moneys, 237. Acts as bullion broker, 238. Binds

together and enlarges business relations, 238, 239.

Profit of the bank, 239. Profits arise out of exchange

of "demand credit" for "time credit," 240. Equipment

of bank, 240, 241. Money reserve, 241. Ordinary de-

mands for money, 241, 242. The bank's salable credit,

242. Profits based on investment of credit, 242-244.

Kinds of investment that a bank may safely make,

244-249.

XI. THE FEDERAL RESERVE SYSTEM AND OTHER

250-274

AIDS TO COMMERCIAL BANKING

Early banking regulation, 250. The national banks,

250, 251. National banking system inadequate, 251,

252. The dual system of banks, 252. Inadequacy of

reserves, 252, 253. The panic of 1907, 253, 254. The

strain on the New York bank reserves, 254. Inelasticity

of the national bank notes, 254, 255. Absence of redis-

count system, 255, 256. The Aldrich-Vreeland Act, 256.

The Federal Reserve districts, 256. Capital of Federal

Reserve banks, 256-258. Directors of the Federal Re-

serve banks, 258, 259. Earnings of the Federal Reserve

banks, 259. The Federal Reserve Board, 259, 260.

Powers of the Federal Reserve Board, 260. Rediscount-

ing agencies, 260, 261. Government fiscal agent, 261,

262. Note issues, 262. Federal Reserve notes, 262-265.

Mobilization and protection of reserves, 265, 266. Re-

discount, 266, 267. Intradistrict clearing through the

gold-settlement fund, 267, 268. Transfer of funds be-

tween Federal Reserve Banks, 268, 269. Intradistrict