of course, the source of profit to the banks, inasmuch as they gain the interest on the money from the time the note is purchased until the payments are made upon it.

There are great advantages resulting from this system of banking operations. In the first place, the risk of loss is reduced to the minimum. Then again, as a traveler proceeds from one country to another, he finds a different set of coins and bank-notes in circulation. Should he carry American bank-bills to Europe, he must exchange them with a broker, at a discount, for the funds current in the country in which he is to travel.

From the foregoing description it will readily be seen that our modern system of banking, while very simple in itself, is yet complicated and complete, being wonderfully adapted to the business world in the transaction of all money affairs.

[NOTE TO THE TEACHER:— It is hoped that the foregoing description of banking operations will be sufficiently explicit to be readily understood by ordinary pupils in high schools and upper classes in grammar schools. It is, however, recommended to the teacher that he obtain deposit tickets, bank checks, drafts on New York and elsewhere, and, if possible, a blank draft on some foreign country, and a circular note. The former can be obtained from the cashier of any bank and the latter from any international banking house. If there is none such in the town, the teacher can obtain these necessary blanks by writing to any such banking house in New York or other large commercial city,

The teacher is also recommended to obtain all possible information from bank officers and business men, so as to be able to supplement the information given above, and to answer all questions that may be asked by the

class.]

THE NEW STATE CAPITOL, ALBANY, N. Y.

CHAPTER II.

TERRITORIAL GROWTH.

THE ORIGINAL TERRITORY. By the treaty of peace with Great Britain in 1783, the boundaries of the United States were defined. They were from the Atlantic on the east to the Mississippi on the west, and from the northern line of Florida on the south to the Great Lakes and Canada on the north. This treaty was negotiated in Paris by commissioners appointed by the United States and by Great Britain for the purpose. France had been our ally, and it was expressed distinctly in our treaty with that country, that when peace with Great Britain should be negotiated, France should be a party to the treaty. Moreover, when our commissioners were appointed to act for our country in the negotiation of this peace, they were instructed by special vote of the continental congress to take no step without France. Franklin, Jay, and Adams early observed that France was not unwilling to pay special attention to the interests of Spain in these negotiations. Spain held the great province of Louisiana west of the Mississippi, and greatly desired to annex to that territory the country northwest of the Ohio. Franklin at length cut the knot by negotiating the boundary question with the English commissioner without the knowledge of the French government. The provisional treaty, therefore, was signed before the French minister had an opportunity to know

what were to be the boundaries of the new republic. Our commissioners in this way succeeded in carrying the northern boundary through the centre of the Great Lakes and to the Lake of the Woods, thence southerly by the whole length of the Mississippi to lat. 31°, thence easterly to the Atlantic along the northern line of Florda. This territory northwest of the Ohio, thus secured to our country, has proved of vast importance to us. It now comprises five states and that portion of Minnesota east of the Mississippi. The extent of the original territory of the United States was something over 800,000 square miles. This was more than three times as large as France, or Spain, or Germany, or Italy. The population was sparse, the settlements extending in the main only from 100 to 150 miles from the coast. The population was so small and the territory was so large that it does not appear to have entered into the minds of the founders of the republic that we should ever need or acquire additional territory. Hence there is in the constitution no provision for the acquisition of territory.

THE LOUISIANA PURCHASE. — In 1803, however, President Jefferson proposed to our minister to France, Robert R. Livingston, to endeavor to purchase the island of New Orleans, in order that we might control the left bank of the Mississippi to its mouth. Early in the spring of that year, Napoleon, then at the head of the French government, found himself on the eve of a war with Great Britain. He was fearful that his enemy would begin the war in North America by the capture of New Orleans, which would practically convey to Great Britain the entire province of Louisiana, which he had but lately purchased of Spain. To prevent this province from fall