“Whether the universe is really a paying concern, or whether it is an inflated bubble that must burst sooner or later, this is another matter. If people were to demand cash payment in irrefragable certainty for everything that they have taken hitherto as paper money on the credit of the bank of public opinion, is there money enough behind it all to stand so great a drain even on so great a reserve?”

— Samuel Butler

Ramblings In Cheapside (1890)

Adopted from Wikiquote. Last update June 3, 2021. History

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Samuel Butler 232

novelist 1835–1902

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“By its means the banker creates the means of payment out of nothing, whereas when he receives a bag of money from his customer, one means of payment, a bank credit, is merely substituted for another, an equal amount of cash.”

Ralph George Hawtrey (1879–1975) British economist

Source: Currency and Credit (1919), Chapter II, "Metallic Money", p. 20 (2nd ed. 1921)
Context: The use of money does not disestablish the normal process of creating credit. Money, it is true, is always being paid into the banks by the retailers and others who receive it in the course of business, and they of course receive bank credits in return for the money thus deposited. But for the manufacturers and others who have to pay money out, credits are still created by the exchange of obligations, the banker's immediate obligation being given to his customer in exchange for the customer's obligation to repay at a future date. We shall still describe this dual operation as the creation of credit. By its means the banker creates the means of payment out of nothing, whereas when he receives a bag of money from his customer, one means of payment, a bank credit, is merely substituted for another, an equal amount of cash.

“Inflation is an increase in the quantity of money without a corresponding increase in the demand for money, i. e., for cash holdings.”

Ludwig von Mises (1881–1973) austrian economist

The Free Market and Its Enemies, speech to the Foundation for Economic Education https://fee.org/library/books/the-free-market-and-its-enemies/ (1951)

“So: if the chronic inflation undergone by Americans, and in almost every other country, is caused by the continuing creation of new money, and if in each country its governmental "Central Bank" (in the United States, the Federal Reserve) is the sole monopoly source and creator of all money, who then is responsible for the blight of inflation? Who except the very institution that is solely empowered to create money, that is, the Fed (and the Bank of England, and the Bank of Italy, and other central banks) itself?”

Murray N. Rothbard (1926–1995) American economist of the Austrian School, libertarian political theorist, and historian

The Case against the Fed.

“There is no art which one government sooner learns of another than that of draining money from the pockets of the people.”

Adam Smith (1723–1790) Scottish moral philosopher and political economist

Source: (1776), Book V, Chapter II, Part II, Appendix to Articles I and II.

“Cash Payment the sole nexus; and there are so many things which cash will not pay!”

Thomas Carlyle (1795–1881) Scottish philosopher, satirical writer, essayist, historian and teacher

Source: 1840s, Chartism (1840), Ch. 7, Not Laissez-Faire.
Context: Cash Payment the sole nexus; and there are so many things which cash will not pay! Cash is a great miracle; yet it has not all power in Heaven, nor even on Earth. 'Supply and demand' we will honour also; and yet how many 'demands' are there, entirely indispensable, which have to go elsewhere than to the shops, and produce quite other than cash, before they can get their supply? On the whole, what astonishing payments does cash make in this world!

“What the welfare system and other kinds of governmental programs are doing is paying people to fail. In so far as they fail, they receive the money; in so far as they succeed, even to a moderate extent, the money is taken away.”

Thomas Sowell (1930) American economist, social theorist, political philosopher and author

During a discussion in Milton Friedman's "Free to Choose" television series in 1980.
1980s–1990s

“The sentence, 'stopping the printing presses,' is a figurative expression, because it is being done now by creating credit by the Federal Reserve System. But this is government action — all inflation is ultimately the result of activities which government determines and can control. And all inflations have been stopped in the past by the government stopping creating money, or preventing the central bank from creating more money. May I add just one thing? See, all inflations have been stopped by people who created or believed in a very naive form of the Quantity Theory, and acted on that. It may be wrong, but it is the only adequate theory effective to stop an inflation.”

Friedrich Hayek (1899–1992) Austrian and British economist and Nobel Prize for Economics laureate

1975 interview https://mises.org/library/hayek-meets-press-1975 on "Meet the Press."
1960s–1970s

“Everything's plastic, we're all going to die sooner or later, so what does it matter.”

Elizabeth Wurtzel book Prozac Nation

Source: Prozac Nation

“[Credit] is an evidence of banking, but it is not the money itself. Money is gold, and nothing else.”

J. P. Morgan (1837–1913) American financier, banker, philanthropist and art collector

Testimony to the Pujo Committee (1912)

“For precocity some great price is always demanded sooner or later in life.”

Margaret Fuller (1810–1850) American feminist, poet, author, and activist

As quoted in Margaret Fuller Ossoli (1898) by Thomas Wentworth Higginson, p. 289.

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