“You do not say who gave me the money,” replied Annie. “Why, no one,” answered Clara. “You borrowed it, and have already paid me. You need financial training, I see.” “It is hard for me to feel that my work is worth anything,” said Annie. “I am used to working for nothing, or for my board and clothes.” “You must lose no time in learning,” said the doctor, “that labor has made all the wealth of the world. Money is nothing but the representative of that labor.” “Have not gold and silver any value in themselves?” asked Annie. “Intrinsic worth, you mean. Yes; and therefore they are not fit representatives of wealth. Political economists are beginning to see that there is no more necessity for money, the measure of wealth, to have intrinsic value than that the yard-stick should be made of gold, or set with precious stones. But I’ve no time to discourse on finance just now—not time, at least, to make myself clear.” “You forget, doctor,” said Susie, with some pride, “that we have been reading up on this subject. We see clearly why children or savages should be unable to comprehend abstract questions; and until they do, they are swappers and barterers, not financiers. The savage wants bright beads and gorgeous feathers for the buffalo robe he offers you. He deals only with the concrete. Civilized people see the need of a medium which, without value in itself, may simply stand as a record of the values exchanged, the basis of the exchange being confidence in each other’s honesty.” “The question of money,” said Clara, “has always perplexed me. I have worked out several systems in my mind; but when I apply them hypothetically in practice, they don’t work perfectly. It is like the clearing of algebraic equations by substituting _m_ + _n_ and _m_ − _n_ for the values of _x_ and _y_. All goes on smoothly, and you solve lots of problems, until you come to one where your substituted values only involve _x_ and _y_ more and more, instead of eliminating them. Just now it seems to me that the government should issue all the money necessary for the transaction of business, this money being simply a guarantee of exchange based simply upon the national wealth and credit. But then, for the balancing of accounts in our exchange with foreign nations, paying interest on our bonds which they hold, we seem to need something else.”