36

A TREATISE ON MONEY

BK. I

But a bank-deposit may also be held, not for the pur-pose of making payments, but as a means of employ-ing savings, i.e., as an investment. The holder may beattracted by the rate of interest which his banker allowshim ; or he may anticipate that other investmentsare likely to depreciate in money value ; or he mayattach importance to the stability of the money-valueof his savings and to being able to turn them into cash atshort notice ; or he may find this the most convenientway of holding small increments of savings with theintention of transforming them into a specific invest-ment when they have accumulated to a sufficient sum ;or he may be awaiting an opportunity of employingthem in his own business ; or other such reasons mayinfluence him. We shall call deposits of this typeSavings-deposits. It is the criterion of a savings-deposit that it is not required for the purpose ofcurrent payments and could, without inconvenience,be dispensed with if, for any reason, some other formof investment were to seem to the depositor to bepreferable.

(ii.) Demand-Deposits and Time-Deposits

A Cash - deposit roughly corresponds to whatAmericans call demand-deposits and we call current-accounts ; and a Savings-deposit to what Americanscall time-deposits and we call deposit-accounts. ASavings-deposit also corresponds to what used to becalled in theories of Money, which were stated withprimary reference to a Commodity Money, the use ofmoney as a “ Store of Value ”. But the correspond-

different branches ; the circulation of the dealers with one another, and thecirculation between the dealers and the consumers. Though the samepieces of money, whether paper or metal, may be employed sometimes inthe one circulation and sometimes in the other, yet as both are constantlygoing on at the same time, each requires a certain stock of money of onekind or another, to carry it on.”