Bonds, notes, or other evidences of indebtedness, in which the borrower agrees to pay principal, or interest, or both, as the case may be, in " lawful money " of the United States; money which the Government declares to be "legal tender " (to which subject refer).

Payable Only through the Clearing-house. After the reader has familiarized himself with "Clearing-House Loan Certificates," and the reasons for their issuance, it will be understood that the banks in times of financial distress have need to hold on to some actual cash. As a result, in such instances, checks are sometimes accepted in lieu of cash, such checks being stamped: "Payable only through the Clearing-house," "Through the Clearing-house," or with words having similar import. Banks being legally required to pay checks on demand in money which is " legal tender," it is but a matter of accommodation for a person to accept a check stamped as above, but by so doing he satisfies the law as regards "legal tender" payments; although, by insisting, he could compel the bank to pay him the cash, and for such emergencies some money must be actually retained in the vaults of the institution. .

If the reader will understand by referring to "Clearing-House," the methods by which the differences between banks are there adjusted, it will be seen that by pursuing the method of not paying the check at the time of presentation, but by postponing its payment until the "clearing-house" hour of the following business day, that the money necessary to effect its settlement at least once would not be called for, and that possibly no money at all would be needed. The differences between the banks ultimately adjust themselves through the machinery of the clearing-house.

Payable to Bearer. A negotiable instrument, such as a check, may be drawn so as to be good in the hands of the bearer without regard to the person so long as the bearer is a bona fide holder. Such checks may be passed from hand to hand without indorsement. (For further information on this subject refer to "Check;" also see next subject.)

Payable to Order. A negotiable instrument such as a check is drawn payable to some person or to the order of such person; that is, for example: "Pay to the order of Thomas West," or "Pay to Thomas West or order." Such an instrument must be "indorsed" (see "Indorse") to be good in the hands of other than Thomas West. (For further information see " Check.")

In order that an instrument may be negotiable it must be made "to order" or "to bearer; " that is, if drawn payable simply to Henry Adams, he has no right to transfer it, and it is payable to him only. Other words of similar import may be used, but they must be the equivalent of " to order," or "to bearer" to convey the power of negotiability.

Payable with Exchange. When a draft has appended the words" with exchange " or "payable with exchange" the person paying the same is understood to pay the cost of the collection as well as the amount of the face of the draft.