he is able to negotiate at 1% premium the drafts drawn against the proceeds of the sale? Ans. 13%.

Remark. In the last example the rates were made to correspond with those of the 21st, to show more clearly to the pupil that in general the same laws govern the movement of gold in large quantities as regulate the movements of wheat.

23. During the year ending June 30, 1857, our exports, including specie, to England, exceeded our imports from England $54,216,623; but in our trade with Cuba, Brazil, China, and France, our imports exceeded our exports, as follows: Cuba, $30,319,658; Brazil, $15,915,526; China, $3,961,802; France, $9,553,840. During the same time our total excess of exports of specie was $56,675,123, of which $46,821,211 went to England, and we will suppose, for this example and the one following, that the balance of excess went, in equal amounts, to the other four countries. Why did the specie go to England, when we were not in debt to her, and how was our debt to the other countries probably settled?

24. First, Suppose the last example to represent our entire foreign commerce and trade for that year, after a full settlement, and to include nothing else, and our due proportion of specie for currency to have been preserved by supply from California, and the Custom House value to be the exact exchangeable values of both importations and exportations, what was the balance of net profit as shown by the excess of imports ? Ans. $5,534,203. Second, What per cent. would that profit be on the entire exports to those countries which, for that year, specie included, were about $240 millions ? Ans. About 21%.

Third, If the exports, as entered at the Custom House, not including specie, were $170,000,000, and the imports, as received, were entered $231,000,000, what was the balance of payments in specie, if the exports, being carried by American vessels, brought in the foreign market 10% advance on their Custom House valuation, and the imports were entered 5% below their cost? Ans. $56,157,895. Actual balance of payments, $56,675,123.

Fourth, If our due proportion of currency required no increase of specie for the year 1857, and California, with other American mines, furnished for the market $49,000,000, how was our balance of trade for that year?

Ans. $7,675,123, against us. Fifth, Suppose we had redeemed, during that year, of our foreign indebtedness in stocks and bonds, $10,000,000, what would then have been our balance of trade?

Ans. $2,324,877 in our favor.

BILLS OF EXCHANGE.

ART. 126. A bill of exchange is an order or draft, made by one person upon a second, to pay a certain sum of money to a third, or to his order, or to the bearer. For example:

$1000.

CLEVELAND, O, Nov. 6, 1858. Sixty days after date, pay to the order of J. F. Whitelaw. one thousand dollars, and place to the account of To Messrs. SMITH & BROWN,

New York.

ALBERT CLARK.

The person making the order is called the drawer; the person to whom the order is addressed is called the drawee ; and the one to whom the amount is payable is called the payee. If the drawee accepts, by writing his name across the face of the bill, under the word "accepted," he then becomes an acceptor, and the instrument is then called an acceptance. If the payee writes his name upon the back of the instrument, he becomes an indorser. The person to whom it is afterward transferred by indorsement is called an indorsee.

Foreign bills are those which are drawn in one country but are payable in another.

Domestic or inland bills are those that are payable in the country where they are drawn.

The United States being separate sovereignties, are foreign to each other, and bills drawn in one payable in another, like

the example given above, are foreign bills, though apparently inland.

Time bills are those requiring payment at a certain specified time after sight or after date. All others are payable on demand. When time bills are drawn "acceptance waived," they may be held till maturity before being presented to the drawee; otherwise, they should be presented immediately for acceptance.

PROMISSORY NOTES..

ART. 127. A promissory note is a written agreement by one party to pay to another a specified sum at a specified time. The one making the agreement or signing the note is called the maker. The person to whom the amount is payable is called the payee, and the owner of the note is called the holder. A principal is one directly responsible for the payment of a bill or note at maturity.

For different forms of notes, see examples under the subject of Interest.

A joint and several note is one signed by two or more distinct parties, in which case each one becomes liable as maker or principal, the same as if no others signed with him. Some of the features of a valid promissory note are the following:

A full consideration is implied from the nature of the instrument, but a want of consideration would be a valid defense on the part of the maker as against the payee, but not as against any other holder, into whose possession it may have come without a knowledge of such want of consideration, in which case he would be called an innocent holder.

It may be written with ink or pencil, or it may all be printed except the signature, which must always be in the hand-writing of the maker or his authorized agent. It should be an unqualified promise to pay in money, definite in amount, and independent of all contingencies. The amount should be expressed in the body of the note, in words, and should be relied on for accuracy rather than figures in the margin.

If the time is not definitely stated, it is payable on demand. If the place of payment is not specified it is payable at the place of business or residence of the maker.

In the settlement of bills of exchange and promissory notes, so far as their terms are subject to general law, as fixing the rate of legal interest and day of maturity for example, the law of the State where they are made payable should govern. If a note is not paid at maturity, it continues to draw the same interest as before, if it does not exceed the legalized rate; but if no rate be mentioned, it draws simple interest at the legal rate till paid.

NEGOTIABLE PAPER.

ART. 128. Bank notes, checks, certificates of deposit, bills of exchange, and promissory notes, when properly drawn, are negotiable, except when made payable by the terms of the contract, to one person only. If the amount is payable to "bearer," or is subject to the "order" of the payee, they are negotiable. But if neither the word "bearer" nor "order" appears in the instrument, but simply the name of the payee, it is not negotiable, and the payee cannot give full title to a third party; for the account, as between the maker and payee, would still be subject to a garnishee process from other creditors of the payee.

In the negotiation of paper the transfer may be made by delivery or by indorsement. If payable to "bearer," or to the payee "or bearer," as are bank notes and most checks, the transfer is by delivery. If payable" to the order of" the payee, or to the payee or order," the transfer is by indorse

ment.

If the payee simply writes his name across the back of the paper it is an indorsement in blank, and is afterward negotiable by delivery. But if above this indorsement it be made payable to the order of another person, called an indorsee, it is an indorsement in full, and is then negotiable only by the in

dorsement of the indorsee. By repeating this kind of indorsement there may be several indorsees. When the indorsement is in blank, any legal holder is allowed to write that above it, which will make it an indorsement in full. A qualified indorsement is one that affects the liability of the indorser, but not the negotiability of the paper, as when made "without recourse."

LIABILITY OF PARTIES CONNECTED WITH NEGOTIABLE PAPER.

ART. 129. Bank notes designed to circulate as money, checks, and other paper negotiable by delivery, may be legally retained by an innocent holder, who receives them in good faith for a valuable consideration, though the party from whom they were received obtained them fraudulently.

Bank notes are a good tender if not objected to at the time of payment, unless it should appear afterward that they were, at the time of payment, worthless, or of less value than represented, as when counterfeit, altered, spurious, broken, or uncurrent. Any unreasonable delay to return them, after the discovery is made, whereby the payer loses the opportunity or means of indemnity, would throw the loss upon the payee or holder, on account of the neglect.

If a person receives a check on a bank, it is his duty to present it for payment at the bank during the same or the next day at the furthest; otherwise he holds it at his own risk, the loss being his if the bank fails meantime, provided that the funds were there to meet the check before the failure. If he lives at a distance from the bank he must send it for collection by mail, or otherwise, during the same or next day. If the check passes through the hands of several persons, each one is allowed one day, and his liability, so far as above described, ceases with the succeeding day. Bank drafts, or "bankers' exchange," from their service in making remittances to distant points, may be used to fulfill that mission, but should not be