nd [wm 1798]

Paper Mischief

Ch. < > Government Hoard

5

On the face of this account + the result of a the hoarding every year a quantity of money to a given amount is a loss to conductive[?] capital to the amount of about 1/ 6

th part of the money hoarded: to which may be added loss of the addition that would have been in the way of interest, in each succeeding year.

The effects of hoarding metallic have very little resemblance to the effects of those dissimilar to which the stock of paper money is subject, though defalcation be the result in both cases. In the case of hoarding the defalcation &c is gradual and comparatively inconsiderable: too much so to have any perceptible effect it may well be supposed in respect of the lowering of prices. The effects of a shock to paper credit, though the defalcation may be very copious and sudden may also be incapable of producing any sensible effect in the way of lowering prices. But in this case it is from a very different cause. The same state of things which raised the stock of paper money to the height from which it was broken down by the force of the supposed shock would in no great length of time be sufficient to raise it up again to that same level: and as this restitution would naturally take place before the time when prices might have adjusted themselves to the stock /level of the reduced mass/ of money remaining any determinant fall of prices does not appear to be among the consequences naturally to be expected from shocks to which paper money in a country circumstanced like Britain is exposed.

{+ By preventing wealth the hoarding prevents encrease of prices that would have been effected by the addition to the mass of vendible commodities.}

See the nex[?] page