The Use of Loan Credit

The business man&s;s object is to get the largest aggregate gain from his business. It is manifestly for his interest, as far as may be, to shorten the process out of which his earnings are drawn, or, in other words, to shorten the period in which he turns over his capital. The business man may reach his end of increased earnings by either the one or the other expedient, and he commonly has resource to both if he can. His means of increasing the magnitude of the turnover is a resort to credit and a close husbanding of his assets. The current or reasonable rate of profits is, roughly, the rate of profits at which business men are content to employ the actual capital which they have in hand. The value of the money unit is by conventional usage held to be invariable, and the lenders perforce proceed on this assumption, so long as they proceed at all.