Money and Capital. [Liberty, December 1, 1888.] To the Editor of Liberty:(68 ¶ 1) I have read attentively Mr. Westrup’s farther statement on mutual banking, but fail to see wherein he touches what is to my mind the vital point. He says that the system would not be making use of capital that belonged to some one else. Then I cannot see how it would answer its purpose. The bank itself has no capital save the pledges advanced by borrowers, and if they take out no more than they put in, they make no gain, but are merely to the expense of the transaction. On the other hand, if they do take out more, some one else must have put it in. They do not increase their wealth by using their own pro...
These letters, addressed to Frederic Bastiat, an economist, originally appeared in a debate published in The Voice of the People, in 1849. Interest and Principal A Loan is a Service On the one hand, it is very true, as you have unquestionably established, that a loan is a service. And as every service has a value, and, in consequence, is entitled by its nature to a reward, it follows that a loan ought to have its price, or, to use the technical phrase, ought to bear interest. But it is also true, and this truth is consistent with the preceding one, that he who tends, under the ordinary conditions of the professional lender, does not deprive himself, as you phrase it, of the capital which be lends. He lends it, on the contrary, precisely bec... (From : Anarchy Archives.)