Date: December 12, 1930
Location: Northampton, MA
Summary: Sales by installment payments do not encourage extravagant spending. This form of credit is a powerful demonstration of trust among the public.
(Original document available here)
Three or four years ago there began considerable discussion of the practice of installment sales. While the system was by no means new, it was then being expanded into new fields with extraordinary rapidity and assumed such large proportions that it aroused considerable alarm. Some thought it might be undermining our whole credit structure. No definite and separate figures were obtainable as to the extent to which banks were involved, and this raised the question of what funds were tied up in it. The developments of the past few months have demonstrated that there was nothing unsound in this. movement. The percentage of losses has been insignificant. Probably of all commercial credits this form stands well towards the top in satisfactory results. Because installments have been paid, most of the fear of ‘it as a breeder of extravagance has been dispelled. Properly conducted, it is no more subject to that criticism than the open account.
But the great lesson is the honesty and integrity of the people. The consuming public pay their debts. It is another powerful demonstration of the justification of faith and confidence in each other.
Citation: Calvin Coolidge Says: Dispatches Written by Former-President Coolidge and Syndicated to Newspapers in 1930-1931 (Calvin Coolidge Memorial Foundation)
The Coolidge Foundation gratefully acknowledges the volunteer efforts of Paige Gibbs who prepared this document for digital publication.