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their inventories and realize sufficient money to meet their loans. These business men he called in and
in a very sympathetic tone of voice explained to them that they were simply victims of “economic laws”
and that “economic laws” could not be violated. The strong room keeper had “to safeguard the money
of the community.” Though he disliked to act, it would be necessary for him to foreclose. He
thereupon took over their businesses. Of course, he shed a few tears and told the business men he really
felt very sorry that such a situation arose, but that his first duty was to safeguard the money of the
community and that the “laws” of economics simply could not be violated by mankind.
This meant foreclosures. The business men had borrowed the banker’s loans of imaginary or
“confidence” money, secretly manufactured, actually sheer counterfeit; and now because the volume
had been contracted must repay the “loans” with real wealth. The business men thus had to turn over to
the strong room keeper the results of many years of hard work. They had built their factories and stores
over a period of years; they now had to turn them over to the keeper of the strong room and begin all
over again, or try to find employment working for some one else. This process went on until the strong
room owner had called in one-half of his promises-to-pay, and cancelled one-half of the money in the
community. By simply “destroying” one-half of the fictitious money he had created he enriched
himself by foreclosing on real wealth pledged against the loan of his fictitious money. Business men
had pledged their real wealth (factories and properties) to obtain a loan of money which had nothing
behind it except the money man’s purely imaginary “credit”—on which they had paid interest.
THE COMMUNITY CALLS AN ECONOMIC CONFERENCE
The community had changed from a happy prosperous one to a scene of discouragement,
disillusionment and poverty. Many working men had been discharged; many business men had lost
their businesses and their homes; many farmers had lost their farms. The school children were no
longer well fed and clothed. The demands for charity were overwhelming. Dissatisfaction and crime in
the community became a serious problem.
The principal Christian clergyman in the town was a kindly, sympathetic gentleman. He wisely
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Gertrude Coogan, Money Creators, ch 1, 2, 3, 4, 5
suggested that a committee be appointed to discuss the plight of their community, and see if there was
not some solution to the serious mysterious trouble.
That suggestion was an excellent one. Therefore, two clergymen, two business men, the Mayor and one
of the aldermen were asked to meet with the strong room keeper to discuss the town’s problems. The
business men were open, frank individuals and when asked for their opinions they said they believed the
problem was a monetary one; that there simply was not as much money in the community as there had
been before the trouble started. They pointed out that the same farms, factories, men and women were
there and that, as they saw it, the one thing lacking was a sufficient amount of money in circulation to
carry on production and distribution to effect the exchange of goods between various classes of
producers and workers in the community. One of the clergymen spoke and said that he did not claim to
understand the intricate “laws of economics,” but that he was inclined to believe that the business men
were right in their opinions.
However, the Mayor spoke. He said he knew “the people themselves were to blame” for the condition
they were in. After all, they had been getting along very well and some of them had grown careless.
“Why, some of the working men were even buying new furniture for their homes, and some working
men’s families had gone so far as to have their children taking music lessons.” Of course, he realized
that the town had made a great mistake when it had exceeded the bounds of good judgment by building
a recreation park for the children. He admitted that the city officials themselves had been carried away,
and that they regretted ever having proposed building a recreation park, for now they realized that the
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