(I) The tax assessor cannot properly appraise it at $10,000, because it certainly would not sell for that sum, and if the community should have to sell it for taxes the actual return minus the charges would be so much less than the $10,000 that the community's books would show a heavy loss; and this practice, if largely indulged in, would bring the community into financial straits. The community must be exceedingly conservative in its estimate, for this very reason; and, therefore, it has been customary, almost universally, to tax such articles practically on their sale value at what might be called panic prices. The company which sold the shovel to the railroad would not buy it back two days after the sale for more than the original price minus what that company considers its selling charges, say 20%; so that, in this case, even if a customer were at the door, the shovel would not be worth more than $8,000, and a fair tax appraisal could not consistently be more than $8,000 minus charges of, say, $250, or $7,750. (II) Assuming that the railroad is a very small one, that it wants to borrow money, and desires to put up the shovel as collateral for the loan. What would be its loan value to the lender? In considering this point, it is necessary to assume that no aid is rendered by the credit of the railroad itself, but that the protection for the loan is to be furnished by the shovel only. Now, the banker will reason that, in the event of the note remaining unpaid, he will have to sell the shovel to reimburse the bank for its loan, and he will be required to consider the matter on a conservative basis. He cannot lend on the shovel up to its full value, for in the first place it is not a "negotiable security." If it were a security, with a free market on some stock exchange, he would probably lend to the amount of 80% of its value, but a steam shovel in a sand bank on a railroad is by no means as convenient of exchange, nor as easy to foreclose on as a stock certificate in a banker's box; therefore he will lend, or he ought to lend, less than 80% of its sale value, minus the selling charges. If he lends more than this, he is lending on the credit of the owner of the shovel rather than on the shovel itself. Granted that the maker of the shovel is willing to buy it back at its full selling price less the selling cost, the maximum loan value of the shovel would be a little less than 64% of its purchase price, or $6,400. To lend more than this on the shovel would not be conservative banking. There is another bonding or loan value to this shovel, when it is considered as part of the assets of the railroad, the bonds of which are to be held by the banker, under which circumstances a higher value than $6,400 would be admissible.