day asserted that if we could only furnish currency enough the rate of interest would become as low, I think it was in Georgia, as it is in London—the rate of interest at any given point is regulated by the proportion of the amount of loanable capital existing or attainable to the demand for the use of that capital. Loanable capital is that which persons possess beyond the amount used by them selves in production. Where the amount of loanable capital is large, there the rate of interest will be low; and where the amount of loanable capital is small, there the rate of interest will be high. But loanable capital is the accumulation of surplus earnings. It is therefore the growth of time. Hence in communities where production, labor and the accumulation of surplus earnings have gone on but a short time, or where such accumulation has been destroyed, as by war, the rates of interest are high, and will remain so until the necessary accumulation to lower them is effected.
The other day I received a letter from Omaha, in Nebraska, complaining very much that interest ranges there at 12 to 24 per cent., while in Boston and New York, as the letter stated, it ranged only from 6 to 8. That is undoubtedly true. In New York and Boston we can hear exactly the same complaint, that interest ranges there from 6 to 8 per cent., while in London and Amsterdam it ranges from 2 to 3; and the reason of the difference between Omaha and Boston, and between Boston and Amsterdam is exactly the same. In London and Amsterdam there are large accumulations of loanable capital; centuries have been spent in piling it up; larger accumulations of loanable capital than in New York and Boston. And in New York and Boston there are larger accumulations of loanable capital, also the growth of centuries, than in Omaha in Nebraska, or in Hannibal in Missouri. Now, if we could transport the accumulation of wealth
