1. _Everybody always needs to borrow._ That the business of the world even in Western lands depends upon the borrowing of money, and that credit is the largest factor in trade, are positions which we do not for a moment forget. But Chinese borrowing is of a different type from that with which the great expansion of modern commerce has made us familiar. We do not affirm that there are not Chinese who do not need the money of other people for the conduct of their affairs, but only that these people are so rare that they may as well be disregarded. The whole scale of Chinese living and the whole system of economics are of such a sort, that as a rule there is but a narrow margin of financial reserve. With all their practicality and skill in affairs, it is a constant source of wonder that so few Chinese ever have anything to fall back upon. One reason for this is the fact that it is very difficult for them to accumulate a reserve, and another equally potent is the fact that there is nothing which can be safely done with it pending its use. There are no savings-banks, and there are no investments which are safe. The only thing which can be done with ready money, is to lend it to those who need it, which is generally done with some reluctance, as the lender justly fears lest he should never again see either interest or principal. Whoever has a wedding in his family, is liable to have to borrow money to carry it through, and if it be a funeral the necessity will be still more urgent. He needs money to start in business, and he needs more to settle up at the end of the year, when, if their own accounts are to be trusted, nine Chinese out of ten who engage in business in a small way, find that they have "lost money"; though this often signifies that they have not realized so much as they had hoped. In short it is hard to find a Chinese to whom the loan of a sum of money at any time, would not be as welcome as "water to a fish in a dry rut." It is this all-prevailing need which smoothes the surface of the spot where the pit is to be dug.