undertakings they wish to embark in, have no difficulty in making up their minds to give up to the Possessors of capitals or money, who are willing to trust them with it, a portion of the profits they expect to gain over and above the return of their advances.
S71
Fifth employment of capitals: the loan upon interest. Nature of the loan.
The Possessors of money balance the risk their capital may run if the enterprise does not succeed, with the advantage of enjoying a definite profit without labour; and they are influenced thereby to demand more or less profit or interest for their money, or to consent to lend it in return for the interest the Borrower offers them. Here, then, is another outlet open to the Possessor of money,—lending on interest, or the trade in money. For one must not make a mistake; lending on interest is nothing in the world but a commercial transaction in which the Lender is a man who sells the use of his money and the Borrower a man who buys it; precisely as the Proprietor of an estate and his Farmer sell and buy respectively the use of a piece of land which is let out. This is what is perfectly expressed by the name the Latins gave to the interest of money placed on loan,—usura pecuniæ, a word the French Rendering of which has become hateful in consequence of the false ideas which have been formed as to the interest of money.
