Ben Franklin was one of the great founding fathers of our country. He is seen on he 100 dollar bill and has invented many things we use still today. Ben Franklin actually wrote about currency in 1729 right before Adam Smith’s “Wealth of Nations.” So it is interesting to see what Mr. Franklin had to contribute to Economics before Economics really existed. It is called “A Modest Enquiry into the Nature and Necessity of a Paper Currency.”
Here are some parts I found to be interesting:
“First, a great want of money in any trading country, occasions interest to be at a very high rate. And here is may be observed, that it is impossible by any laws to restrain men from giving and receiving exhorbitant interest, where money is suitably scarce: for he that wants money will find ways to give 10 per cent. When he cannot have it for less, altho’ the law forbigs to take more than 6 per cent.”
This is important and reminds me of a part of Ludwig Von Mises’ “Human Action,” which they both realize tht there is a natural rate of interest. This rate cannot be controled by government due to the fact that there is a fixed amount of money in the economy and there is a certain demand for the use of that money, hence why banks were invented.
“Upon the whole it may be observed, that it is the highest interst of a trading country in general to make money plentiful; and that it can be a disadvantage to none that have honest designs. It cannot hurt even the usurers, tho’ it should sink what they receive as interest; becase they will be proportionably more secure in what they lend; or they will have an opportunity of employing their money to greater advantage, to themselves as well as to the country.”
This is obviously touching on inflation and how Ben Franklin is trying to figure out of the world works around him. He does continue to try to figure out who is hurt and helped with the increasing amount of money.
There you have it from the man that help found this country…