[Rudiments sheet]

28 Novr 1799

Annuity Note

Brouillon VIII

1. Small Notes

2 Official Currency[?]

3. Cash Fund

4

5. Government to […?] of the Cash[?] […?] to the Bank[?] for in the […?] to make

discount with.

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{ Extent - after Par.

Might not Government out of its Cash Fund take in Annuity Notes on certain terms

over and above such as are brought in in payment of Taxes?

This might be done either by lending the cash in the Notes /in each[?] Annuity

Note/ as a security (lending suppose ¾ of their /its/ value) or by purchasing

them outright for /at/ a small premium /profit/ and then not counting[?] them

but re-issuing them

As Annuity Note Paper wants[?] be more eligible than cash to the individual, so

would it to Government: Government so long as it kept each note in the Exchequer

without re-issuing it, would be making interest on it: i:e: saving the interest.

In this way, it would be for the advantage of Government to take in whatever

Notes were brought to it, giving Cash for them: so long as it had the sure means

of recovering the cash when wanted: which it woud[?] have so long as the issue

in the Country at large continued. }

Extent after Par

If Government thus bought in the Notes, instead of lending upon them, instead of

taking the money under the name of a premium (which would make a discount in the

Notes) it might take it in the name of a fee for each Note: and if this fee was

the same for notes of all dimensions (say ½ or 1d) it would operate as an

exclusion of the very small notes in which the trouble of counting would be an

object

Analogous practices.

Pawnbroking

Warehouse-room in addition to interest. Commission (mercantile) in addition to

interest.

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{ Extent after Par

The terms might be such as would render the transaction advantageous upon the

whole to Government, lender paying for Clerk’s time.

Or an accredited body such as the Bank, or E. India Company might do the

business, Government furnishing them with the cash on certain terms. }

Government might re-issue them though not open any but through the Post Offices.

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{ Currency Steadiness

The condition requiring cash to be paid on taking out an Annuity Note, and do

coupld with the appropriation of that cash effectively protects the Holders of

Annuity Notes from seeing them depretiated by an excessive and unlimited issue

of this kind of paym.[?] as has so often taken place in the case of the American

and French paper monies. Without the payement of cash, the necessity of the

consent on the part of the taker-out of this paper would not be sufficient to

afford the security in question: since the amount of any apprehended

depretiation might be made up to each individual taker-out (as is the practice

in the case of Navy Bills and Treasury Warrants) and thus the market might be

mandated[?] to any pitch.

They can not be issuers but in so far as they are preferred to cash. }

Extent. Effects

The quantity of unemployd capacity of labour combined with the quantity of hard

cash exportable with profit /advantage/ will give /limit/ the quantum of

additional wealth which the country can be made to receive in the course of a

year from this source, but it will not limit the number of returns which the

quantity of hard cash left in the circulation is capable of making to the

Exchequer for Annuity Notes nor consequently the quantity of nominal value which

government will have it in its power, (and indeed lie under the obligation) of

introducing within the year (and so from year to year) supposing stock not to

have been yet raised to par.

As far as the guineas are furnished by income, this reciprocation can not extend

beyond the sum of the income of individuals: but as far as they are furnished by

masses of capital, there seem to be no limits to the rapidity with which the

exchange may be

repeated.

Extent. Effects

repeated

The only limit opposed to the rapidity seems therefore to be that which is set by

the uncertainty whether the individual who has the money to receive in each

instance has the prospect of being able to keep it by him long enough to pay him

for the trouble of sending to the next Post House to exchange for Annuity Notes.

War & Peace

Difference between the advantage in time of War, and in time of Peace.

In time of war, it helps raising the Funds, which then, taken by itself is a

result not desirable: since the lower the funds are when the buying-in phase

sets out after the conclusion of the War, the more advantageous the terms on

which it buys in.

But the advantage by forbearance of Dividends is a very substantial one, and

applies equally to War & Peace.

On this account the greater quantity of the Mass of Annuities can be exchanged

from Stock into Notes, the better.

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{ Effects Bankers

Compensation

Bankers would get the cash that now goes to the composition of Petty Hoards. The

business of the country Bankers would assume the form now assumed by the London

Bankers. They would issue less paper or notes[?], but they would {have}

/receive/ more cash. }