This article examines the nationwide campaign by financial reformers in the 1910s to convince businesses across the United States to abandon established commercial credit practices and use trade acceptances—the quintessential “real bill”—in their stead. The creation of the Federal Reserve System (Fed) and the outbreak of World War I offered a powerful coalition of campaigners the opportunity to forcefully argue that by capitalizing open account credit, trade acceptances fostered good business practices and stabilized the banking and financial systems. These campaigners relied on trade associations to disseminate, and the federal government to legitimize, their message. While some firms obliged, many businesses and banks criticized the campaigners’ arguments, casting trade acceptances as a means of financial centralization and as being contrary to the American culture of credit. Trade acceptances did not supplant promissory notes or trade in the open market and were rarely used by banks to access Fed liquidity. Instead, their legacy lies in their adoption by finance companies in the hope of securing financing for the distribution and mass consumption of consumer durables.

Paul A. Volcker has spent most of his life in public service, at the Treasury under President Kennedy (1962–1965) and then as Undersecretary for Monetary Affairs under President Nixon (1969–1974), as President of the Federal Reserve Bank of New York (1975–1979), and finally as Chairman of the Board of Governors of the Federal Reserve System under both President Carter and President Reagan (1979–1987). Born in 1927, his world view was formed by childhood experience of the Great Depression and World War II, times of great national trial that led ultimately to recommitment and reconstruction. He went into public service in order to be a part of the rebuilding effort, but it was his fate instead to be involved mainly in managing pressures that would ultimately lead to the breakdown of the Bretton Woods system internationally and the Glass–Steagall banking system domestically. Consequently, there is some sadness today when he looks back on his career, but there is also a sense of accomplishment. In spite of everything, there was no depression and there was no world war. The possibility and hope for progress in years to come remains alive.

The interview took place in Volcker's office at Rockefeller Center in New York City. His fourth-floor windows look out over the sunken plaza to the gold-leafed statue of Prometheus stealing fire from the gods, and then on farther to the elegant GE building, which is familiar to anyone who has visited New York. Over the front entrance it is just possible to see the inscription adapted from Isaiah 33:6, “Wisdom and Knowledge shall be the stability of thy times.” It strikes me as an appropriate inscription for the building, reminding one that this most beautiful complex was built in the years of the Great Depression. Today, with the forthcoming interview in mind, it reminds me also of the stakes involved in the conduct of monetary policy.