I would, therefore, base part of the new issue on a sound security like Consols, which is representative of the country’s credit, or wealth. The notes themselves are representative of its wealth, therefore Consols would be an extra security. I would not advocate the withdrawal of the notes, because the machinery has now been provided for possible use at a future crisis. The machinery could be set in motion again without resorting to the cumbersome process of suspending the Bank Charter Act. It gives us a provision for unknown contingencies. To keep a limited amount of Treasury notes in existence should be no more a potential danger to the future of our financial fabric than the issue of a huge war loan. On the contrary, they should help us the better to bear the burden of a war loan if there be no improvident, or over-issue of them. They should be no greater menace than the sudden, prodigious output of gold which we could not use. We would not declaim against the imports of huge quantities of gold each week and the corresponding increase of currency. If so arbitrary an increase could do no harm and would be considered beneficial, then a limited supply of other currency, such as our Treasury notes, should not be harmful. And if the discounting of millions of unnegotiable pre-moratorium acceptances, creating currency in such abundance as to make it exceedingly cheap, is not harmful, then the issue of a limited quantity of Treasury notes, against which the Government is setting aside an equal quantity of gold, should not be harmful. To predict that it will bring economic evil in a distant future that cannot be foreseen, is as valuable as many another theory that has failed to stand the test of reality. It should be no more harmful to the future than the issue of Bank of England notes has been, based on a book debt and securities, during the last seventy years. CHAPTER XX CREDIT AND CIVILIZATION I have endeavoured to argue that our banking system and a purely credit system are not identical. A perfect credit system would be based entirely on faith, or profound belief in individual and national integrity and honour. Tradesmen know what kind of credit this is. They know that men may have huge and safe balances in banks, yet may be rogues. But a bank’s faith is not of this implicit and profound character. A bank demands material evidence of faith, and it places greater value and trust in the matter than in the spirit. Our banking system is ahead of the banking systems of other countries, but this is largely because our economic organism is older, our national character stronger, our freedom greater. Our so-called bank credit rests primarily on national wealth and secondarily on character. A bank will not lend on character alone. Character is not the wealth it is ready to transform.