The three wants which we have been considering are frequently, and at the present time commonly, satisfied by means of credit in one form or another. The methods of employing this instrumentality as a medium of exchange are various, but only the simplest one can be appropriately explained at this point. Modern commercial processes are conducted by means of a large class of middlemen who intervene between exchangers and relieve them of the greater part of the work involved in trading their products. Among these are shopkeepers who purchase goods, giving the sellers credit on their books for the value of their sales, and sell them again at such times and in such amounts as are desired, debiting buyers with the amount of their purchases. Inasmuch as the buyers and the sellers are frequently the same persons, these merchants are a means of overcoming the difficulties of barter discussed in the preceding section, and their book accounts serve as a medium of exchange.

By way of illustration let us suppose that a primitive community has already acquired a standard of value, and that some very reliable person, in whose integrity and wealth everybody has perfect confidence, establishes a general store, and agrees to buy from the producers everything they have for sale and to sell these same commodities to others at such times and in such quantities as are desired. After the harvest A brings his wheat to the store and receives credit on the books of the storekeeper for the amount agreed upon, this amount being stated in terms of the prevailing standard. Subsequently he purchases various commodities, such as sugar, shoes, coats, meat, etc., and is debited by the storekeeper with the amounts of his purchases, these amounts being likewise stated in terms of the standard. It is evident that the difficulty involved in exchanging commodities of unequal value is not here met, because it is not necessary that A's account should balance on the occasion of every purchase or sale. It is also evident that A could accumulate his savings in the form of credit on the storekeeper's books, and could borrow by overdrawing his account; that is, by accumulating an uncovered debit balance. In this case the book account serves precisely the same purposes as the gold in our previous illustration. It obviates the difficulty of exchanging commodities of unequal value, and it furnishes a means of making savings and of borrowing and lending.

At first sight there does not seem to be much resemblance between this primitive storekeeper and the great merchants and bankers of the present day. But as a matter of fact they are performing the same functions as he, and by means of very complicated machinery they are using credit of substantially the same sort as he. Their book accounts have become notes and bills of exchange and credit documents of various sorts, but like his they satisfy the three fundamental wants which we have been discussing and which are felt by all traders however primitive or advanced.