We have to live by trusting in each other, trusting in each other’s financial means and financial honesty. A man may be highly moral and respectable in his life, a worthy husband, father and citizen, an able and faithful servant, thoroughly trustworthy, yet may be mean and financially dishonest. Or he may be the victim of misfortune and cannot redeem his debts to the tradesman and others even if he would. Looking more closely into the credit on which a tradesman relies we find it altogether different from the credit which, it is declared, banks create and prosper on. We can, perhaps, contend that a tradesman lends cheese, butter, and eggs, in the hope that he will be paid for them eventually. I am the customer. I ask him to let me have cheese, butter, and eggs for a month, and I will pay for them at the end of the month. Were I a stranger to him he might demur. But if he has known me for years and knows that I am a man of my word, a man to be trusted, he will gladly let me have the goods on the credit of the reputation I hold with him. What is the tradesman’s security? Simply my word and my reputation. Simply his trust in me. I do not leave with him my watch, my securities, or my works on political economy. If, however, I failed to pay for the goods I received of him and had left some of my valuable possessions with him, he could sell these possessions in the market, and indirectly be paid for his goods. If he were indirectly paid for them, would he be granting me credit? He would certainly not be granting that kind of credit which the man in the street understands as credit. Political economists and financiers may be distinct from men in the street, but the simple-minded, the man unversed in the theories of political economy, would see no difference between this and barter. In fact, it looks exactly like the barter so beautifully and so fascinatingly described in primers on political economy. However, we do not pledge our watches with the grocer for eggs and bacon. We pledge our words and our character only, and at the end of the month we hand him over a cheque, the national currency, and once more demonstrate to him the value of _our_ credit, not _his_. Perhaps it is now less difficult for the simple-minded to comprehend why political economists, financiers, bank managers, and those highly gifted men, financial journalists, cannot come to a common agreement as to what it is banks create. There is more agreement amongst them that banks do really lend than there is as to the actual thing banks do lend, credit or money.