Dudley North Quotes
I avert, that high Interest will bring Money out from Hoards, Plate, etc. into Trade, when low interest will keep it back.
Dudley North, 1641-1691, English Economist, Discourses Upon Trade, 1691
Sourced by: Eigen's Political and Historical Quotations
North was none-the-less in favor of allowing interest rates be much higher, but was stating the best argument, believed at the time by most English experts, and many American economists today.
All money has based on the Gold Standard then. But the economic output of the American colonies was increasing rapidly. If the money supply stays fixed, there is a shortage of money and this then inhibits further growth, Franklin realized this and called for an increase in the money supply. He was only 23 years old when he wrote this essay and had these insights.
The assumption was that money would always be backed by gold or silver. In effect, raising or allaying the money was to change the amount of gold or silver that a particular denomination of money would be able to be exchanged for. This is one of the interesting proofs that these processes did nothing economically—for if they could, no one would want the money. This has always been a weakness or a strength—depending on one’s political point of view—of a gold standard.
This is the first major history of banks written in the United States.
Sir Dudley North was an English merchant, politician and economist, a writer on free trade.
