Returning now to the particular transaction in question, the point has been reached where the silk is in the importer's hands, that result having been accomplished without the importer having put up a cent of money. Moreover, for nearly four months to come there will be no necessity of the importer's putting up any money (unless he should sell some of the silk, in which case he is bound to turn over the money to the New York banker as a "prepayment"). But in the ordinary course of events the importer of the silk has nearly the four full months in which to fabricate the goods and sell them. At the end of that time the draft drawn by the firm in Canton and accepted by the Guaranty Trust Co., London, will be coming due, and the silk importer will be under the necessity of remitting funds to meet it. Twelve days before the actual maturity of the £1,000 draft in London, the New York banker will send to the manufacturer in Paterson a memorandum for £1,000 at, say, 4.86 (whatever is the current rate) plus commission. The silk firm pays in dollars; the New York banker uses the dollars to buy a demand draft for £1,000; a day or two before the four months' sight draft comes due in London this demand draft ("cover") is received in London from New York, and the whole operation is closed. It has been deemed advisable to set forth the whole course of one of these import-financing transactions, in order that each successive step may be clearly understood. The question of just _why_ this credit business is worked as it is will now be taken up. The whole purpose of the business, it is plain enough, is to give the importer here a chance to bring in goods without putting up any actual money--in other words, of letting him use a larger capital than he is actually possessed of. There are persons so conservative as to consider this in itself a wrong idea, but with business carried on along the lines on which it is actually done nowadays, bank credits play so important a part that conservatism of this order has little place. Theory and practice prove that there is no reason why a silk importer, for instance, with a capital of $100,000 should not be able to use safely a credit of as much more than that, the standing and credit of the firm being always the prime consideration. Granted that a manufacturer stands well and is doing a safe, non-speculative business on the basis of $100,000 capital, there is no reason why he should not be able to secure an import credit for an additional £20,000. Not only is there no reason why he should not get it, but there are any number of good banking concerns only too glad to furnish it to him.