Front Page Titles (by Subject) CHAP. XIX.: Of equalizing the Exchange. - A Select Collection of Scarce and Valuable Tracts on Money
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CHAP. XIX.: Of equalizing the Exchange. - John Ramsay McCulloch, A Select Collection of Scarce and Valuable Tracts on Money 
A Select Collection of Scarce and Valuable Tracts on Money from the Originals of Vaughan, Cotton, Petty, Lowndes, Newton, Prior, Harris, and Others, with a Preface, Notes, and Index (London: Printed for the Political Economy Club, 1856).
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Of equalizing the Exchange.
THE Author of Lex Mercatoriæ doth hold, That in those Countries where great Banks are kept, the Bankers do by their Arts and Subtilties by the inequalitie of the Exchange, draw away the Gold and Silver out of other Countries: as for Example; In Holland, suppose a man were by Exchange to make over 100 pound sterling thither out of England, The Exchange, saith he, is such when it is at most advantage for England, by the practise and subtilties of the Banker, as you shall receive for your hundred pound there, less in intrinsical value than you gave; and if you make over a hundred pound out of Holland into England by Exchange you shall receive more in Intrinsical value than you gave. And if this Position absolutely be true, as that the contrary doth rarely or seldom happen, it necessarily follows, That it is more advantage to carry over your Money thither in specie, than to make it over by exchange, and it is more advantage to make over your Money thence by exchange than to bring it over in specie.
But (saith he) if it be effectually ordained, That no man shall give his Money here, to receive less in intrinsical value there by Exchange; and that no man shall give his Money there, to receive more in intrinsical value here by Exchange: it is plain, That no man shall have his Advantage to carry his Money thither in specie, nor no man shall have his Disadvantage to bring his Money thence in specie: and if the same course be observed in all places and at all times, let other Nations use what they please to raise or abase the values of their Money, they shall never prejudice the Kingdom by it.
I have abstracted this Proportion in the plainest manner I could, and purposely omitted to name the sums of the Exchange, to avoid all Question about more or less, and all obscurity: and certainly it carrieth with it a great appearance of Reason; neither do I find any strength in that Objection which is most pressed against it, That this equallity cannot be made with other countries, by Reason that a great part of the Payments is made in Base money; for, if Base money be so current, as for it you may have so much purer Money as will answer the intrinsical value required for the Sum to be paid by Exchange, that Objection will fall: if it be not so current, you may except against the Payment.
But yet this Proposition, if it be narrowly examined will be found subject to great Exceptions.
And first, The Difficulty, I may say almost, the Impossibility of putting it in Execution is apparent, for although the intrinsical value be the principal Rule by which Exchanges are squared, yet there are many other Circumstances which do vary and alter the Exchange, and this is for a main one; That when there is much Money to be returned to one place by an Accident unlookt for, you shall (not) find Takers in Proportion, except what they make by the price of Exchange do invite them: if then you will force men alwayes to give and take by Exchange at one rate, when through accident there shall want Takers, you will force the Giver to supply his Necessity, to send his Money in specie, and so that which is propounded for a Remedy of Exportation shall turn to a greater Exportation.
But suppose this Difficulty could be overcome, yet would it not suffice to hinder Exportation; for, if in other Countries, they should value your Money higher than their own, as in this Discourse there are formerly Instances set down, of English Money higher valued than their own, in France, in the Low-Countries, and at Francford Mart: he then which at these times would have made over Money by Exchange into those Parts, by this Proposition, should have had but the intrinsical value in Money of these Countries; but he that had carried his Money over in specie, would have had more than the intrinsical value.
Lastly, It is to be considered, That all Countries that do raise little or no Materials within themselves, (which is our Case in England) must not be so careful to hinder Exportation of the Materials, as to provide for Importation for them; What Fruit then shall we receive by this Equality of Exchange, (admitting that it might be made, and that it would hinder the Exportation) if it should be recompenced by the same Degree of Impediment, which it would give to the Importation, which would necessarily follow upon it; as for Instance, If the Equality of Exchange will give impediment to transport Silver out of England into Holland, will not the same equality of Exchange give the same degree of Impediment to import Silver out of Spain into England? Certainly in all appearance it must.