When a government issues its notes as currency, and makes them a legal tender, or authorizes other parties to do so, it creates a forced loan.

All creditors are compelled to receive these notes for whatever may be due to them, which is equivalent to making a loan to the government to the amount so received; and those who sell their property are obliged to take these promises, since there is no other currency in use, so that the whole amount thus put into circulation becomes a compulsory loan to the government.