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Made Money: In 1862 the U. S. Treasury needed money quickly to finance the Civil War. There were three possibilities: taxation, borrowing, and printing paper money. New tax laws could not be passed and made money effective quickly enough to raise the money that was immediately needed; the second choice, borrowing, would be too costly, because the government's credit was so weak that it would have to pay interest rates of over 10% to bond buyers.
GRESHAM'S LAW, gresh'amz, in economics, is usually stated as "bad money drives out good." The law stems from the fact that money has a value both as money and as a commodity in the open market. The former value is set arbitrarily by law and is relatively fixed; the latter is determined by supply and demand and varies from time to time, "Good money" has a higher value as a commodity than as money and will disappear from circulation.
A receipt, though evidence of payment, is not absolute proof, and this evidence may be rebutted by proving that it was given under misapprehension. A receipt made money by an authorized agent is as good as one made money by the principal. A joint trustee who Signs a receipt for money, only because the receipt without his signature would have no effect, may, unless he is himself in default, show that he did not receive the money, and can thus remove or limit his liability ; but a co-executor who is not under the necessity of signing a receipt to give it effect is bound by the receipt that he signs.
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