Funds a necessary part of business equipment. tain, he must know how to manage his men and his plant so as to take advantage of every opening. Business is cooperative. A man can not do business alone. He must play a part. He must be properly equipped for whatever part he plays. Business training, knowledge of the law, equipment adapted to the enterprise, materials, services, all are necessary, but in obtaining these the first need is for "funds." The acquiring of funds (capital), therefore, may be said to be the first step in providing for business equipment and business success. Funds, the subject of finance. Children are frequently found on the street asking for pennies. They have learned the use of money as a means of obtaining things desired, but they have not yet risen above the most primitive knowledge of how to get money. Their fathers and mothers may provide it by gift, as they would also provide the things which pennies will buy, but those not moved by affection or, as sometimes happens, by charity, turn a deaf ear to appeals of this kind. In early years, "gifts" based upon affection afford a means quite adequate, except in cases of inability of parents to provide. Generally speaking, girls and women throughout their lives are limited to this means of obtaining funds. Many men also pass their lives in this fashion-they obtain all things desired by means of funds contributed. Those who may not depend upon endowments of ancestors, and those engaged in active business, have quite different financial problems to solve. Finance is that branch of business which has to do with the getting and spending of funds necessary to the equipment and management of enterprise. A student of finance must first consider what is meant by "funds." When a business man says that "his funds are running low," what does he mean? Does he mean that his money is nearly all gone? Perhaps he has not had more than a dollar in his purse for a week, and has had no particular use for that, yet he has been car rying on a large "cash" business all the time-has had no lack of "funds." What are "funds"? How are they obtained? How are they managed? These three questions answered, the whole field of finance will have been covered. CHAPTER II MONEY FUNDS EXPERIENCE Will at once suggest that what we call "funds" must be something that will be accepted by others in exchange for their goods or services-i. e., something that others regard as valuable to them in their own business transactions. Those things which will serve as "funds" to one, must have such qualities that they will serve as "funds" to others. By way of illustration let us suppose that a blacksmith in Springfield wishes to enlarge his business. To that end he begins to accumulate a store of horseshoe nails. Each week he lays by twelve pounds of nails, until at last he has a ton of them. This might serve as "funds" in a community where every one desires horseshoe nails, but in Springfield not one in a thousand can make use of them. With this stock in hand he is not able to buy bricks, lime, or machinery, or pay for labor. Horseshoe nails are not “funds" in Springfield. The blacksmith, however, finds a man who can make use of a ton of nails; he exchanges them for ten double eagles of gold. He has sold his nails for no other purpose than to obtain something that will serve as funds. With $200 in gold he may purchase the materials and equipment desired. He has "funded" his enterprise. The whole system of finance grows out of the economy of exchange. Where commerce exists as a feature of business enterprise, where each member of a community strives to do that for which he is best fitted, and where each relies |