When credit is expanding, the rising price level and high profits bring about a high rate of interest. When the expansion has reached, the limit perm… - Ralph George Hawtrey

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.

Man is a rational animal, and if human affairs are hard to regulate, his twofold nature is usually the cause. Reason is something ultimate; it would be the same in another planet, or in another universe, as it is here. Animal nature is something contingent; it might have been different. Our life is a compromise, a blend between the animal and the rational.

Scientific treatment of the subject of currency is impossible without some form of the quantity theory … but the quantity theory by itself is inadequate, and it leads up to the method of treatment based on what I have called the consumers’ income and the consumers’ outlay – that is to say, simply the aggregates of individual incomes and individual expenditures.