Ghost of money

[This was a letter I wrote to Edward Carrington, dated May 27, 1788, where I expressed my concern with the vast amounts of printed paper money — ghost of money — as compared to the limited amount of silver/gold coins.]

The bankruptcies in London have recommenced with new force. There is no saying where this fire will end. Perhaps in the general conflagration of all their paper. If not now, it must ere long. With only 20 millions of coin, and three or four hundred million of circulating paper, public and private, nothing is necessary but a general panic, produced either by failures, invasion or any other cause, and the whole visionary fabric vanishes into air and shews that paper is poverty, that it is only the ghost of money, and not money itself. 100 years ago they had 20 odd millions of coin. Since that they have brought in from Holland by borrowing 40. millions more. Yet they have but 20 millions left, and they talk of being rich and of having the balance of trade in their favour.