One obvious advantage of discount is, that it tends to make all capital active and thus productive. It enables the banks to sell their credit and make a gain, to use a part of their money deposits to buy mercantile paper with, and so get a bank interest on them; it enables dealers in commodities to realize in cash _minus_ the discount the sum of what they have sold _on time_; and by means of _accommodation_ notes or bills, which only differ from the others in that there is no _actual_ debt between the parties, business men may swell the volume of their business temporarily, and non-business people may borrow small sums for convenience or emergencies. Bankers have not always credit enough or money enough from their depositors to buy in either mode all the good paper that is offered to them, in which case, they raise the rate of discount unless the law forbids, or by easy evasions even when the law forbids; or else accommodate regular customers and large depositors first, or buy of all that are "good" a certain proportion only. The discount line of 3140 national banks reporting Oct. 4, 1888, was $1,674,886,285.29. It is thus through the purchase of discountable notes for money, that banks derive their partial character as money-lenders. Also, such reserve sums as they do not wish to invest in negotiable paper, on account of the time involved before such paper matures, banks frequently loan _on call_ to those customers who have good collateral securities to pledge for the repayment of such loans. The terms of such a contract give the bank full authority to sell such collateral "_at the Brokers' Board or at public or private sale, or otherwise at said bank's option, on the non-performance of this promise, and without notice_." So far forth banks become direct money-lenders. It ought also to be added, that promissory notes with a single name (or more) are often discounted by banks partly on the strength of collateral securities deposited to fortify the names upon the notes. _f._ Bills of Exchange. A Bill of Exchange is a written instrument designed to secure the payment of a distant debt without the transmission of money, being in effect a setting-off or exchange of one debt against another. It is in form and in several technicalities different from a promissory note, inasmuch as it is an _order to pay_ instead of a _promise to pay_, and inasmuch as the maker of a note is always _debtor_ and the drawer of a bill of exchange is always _creditor_; but all this makes practically very little difference between the two as instruments of Credit, since nearly all bills of exchange come into banks in the way of ordinary business, either for discount or collection, and as the banks care nothing except for _names_, the _form_ of the purchasable paper is a matter of indifference to them. The following is the essential form of an inland bill of exchange:-- $3,000 PITTSFIELD, Mass., Oct. 16, 1889.