This section is from the "The Science Of Wealth" book, by Amasa Walker.
We have thus far examined three different kinds of currency. 1st, Money, consisting of the precious metals: this we have found to be admirably adapted to the wants of trade, except that, for large exchanges, it is too cumbersome, requiring much labor and time in use. 2d, Inconvertible paper, or credit currency, which, we have seen, never has been, and in the nature of things never can be kept at par with coin, and is therefore highly injurious when introduced into commerce. 3d, A mixed currency, or partly convertible paper, which, as it is constantly varying in quality and quantity, cannot be relied on as a medium of exchange or a standard of value.
We now come to the consideration of a mercantile, or substitute currency.
It is quite apparent that a currency is needed which shall combine all the advantages of the two kinds first mentioned, without the disadvantages which we have seen to be inseparable from the third. We want the reliability of coin and the convenience of paper. With these perfectly united, there is nothing more to desire. We have no occasion to increase the currency beyond its natural volume, because that would impair the standard of value. We wish only to have so much currency, and of such a kind, as the laws of trade demand, and, if undisturbed, will always secure.
Is such a currency practicable?
In answering this question, we remark that it would not be an entire novelty, since experiments of this character have been made most successfully upon a large scale, and extending over several centuries.