28G

THE NATURE AND CAUSES OK

occasion for a sum of ready-money, even when he has nobills to discount. When a hank, besides discounting his bills,advances him likewise upon such occasions, such sums uponhis cash account, and accepts of a piecemeal repayment asthe money comes in from the occasional sale of his goods,upon the easy terms of the banking companies of Scotland ;it dispenses him entirely from the necessity of keeping anypart of his stock by him unemployed and in ready money foranswering occasional demands. When such demands actuallycome upon him, he can answer them sufficiently from his .cashaccount. The bank, however, in dealing with such custom-ers, ought to observe with great attention, whether in thecourse of some short period (of four, five, six, or eight months,for example) the sum of the repayments which it commonlyreceives from them is, or is not, fully equal to that of the ad-vances which it commonly makes to them. If, within thecourse of such short periods, the sum of the repayments fromcertain customers is, upon most occasions, fully equal to thatof the advances, it may safely continue to deal with such cus-tomers. Though the stream which is in this case continuallyrunning out from its coffers may be very large, that which iscontinually running into them must be at least equally large;so that without any further care or attention those coffers arelikely to be always equally or very near equally full; and scarceever to require any extraordinary expense to replenish them.If, on the contrary, the sum of the repayments from certainother customers falls commonly very much short of the ad-vances which it makes to them, it cannot with any safety con-tinue to deal with such customers, at least if they continue todeal with it in thismanner. The stream which is in this casecontinually running out from its coffers is necessarily muchlarger than that which is continually running in; so that, un-less they are replenished by some great and continual effortof expense, those coffers must soon be exhausted altogether.

The banking companies of Scotland accordingly, were fora long time very careful to require frequent and regularpayments from all their customers, and did not care to dealwith any person, whatever might be his fortune or credit,who did not make, what they called frequent and regularoperations with them. By this attention, besides savingalmost entirely the extraordinary expense of replenishing theircoffers, they gained two other very considerable advantages.

hirst, by this attention they were enabled to make some