294 THE NATURE AND CAUSES OF

When two people, who are continually drawing and re-drawing upon one another, discount their bills always withthe same banker, he must immediately discover what they areabout, and see clearly that they are trading, not with any ca-pital of their own, but with the capital which he advances tothem. But this discovery is not altogether so easy whenthey discount their bills sometimes with one banker, andsometimes with another, and when the same two persons donot constantly draw and re-draw upon one another, but oc-casionally run the round of a great circle of projectors, whofind it for their interest to assist one another in this methodof raising - money, and to render it upon that account as dif-ficult as possible to distinguish between a real and a fictitiousbill of exchange; between a bill drawn by a real creditorupon a real debtor, and a bill for which there was properlyno real creditor but the bank which discounted it; nor anyreal debtor but the projector who made use of the money.When a banker had even made this discovery, he mightsometimes make it too late, and might find that he had al-ready discounted the bills of those projectors to so great anextent, that, by refusing to discount any more, he would ne-cessarily make them all bankrupts, and thus, by ruiningthem, might perhaps ruin himself. For his own interest andsafety, therefore, he might find it necessary, in this very pe-rilous situation, to go on for some time, endeavouring, how-ever, to withdraw gradually, and upon that account makingevery day greater and greater difficulties about discounting,in order to force those projectors by degrees to have recourse,either to other bankers or to other methods of raising money;so as that he himself might, as soon as possible, get out ofthe circle. The difficulties, accordingly, which the bank ofEngland, which the principal bankers in London , and whicheven the more prudent Scotch banks began, alter a certaintime, and when all of them had already gone too tar, to makeabout discounting, not only alarmed, but enraged in thehighest degree those projectors. Their own distress, ofwhich this prudent and necessary reserve of the banks was,no doubt, the immediate occasion, they called the distress ofthe country; and this distress of the country, they said, wasaltogether owing to the ignorance, pusillanimity, and badconduct of the banks, which did not give a sufficiently liberalaid to the spirited undertakings of those who exerted them-selves in order to beautify, improve, and enrich the country.