with which the English
Government
coins gratuitously, the following opinion of Sir Dudley North: --Silver and gold, like other commodities, have their ebbings and flowings.
Marx - Capital-Volume-I
par les productions.
?
[--It?
(money) --has no other motion than that imparted to it by the products?
] (Le Trosne, l.
c.
, p.
885.
)
29 --Ce sont les productions qui le (l'argent) mettent en mouvement et le font circuler . . . La ce? le? rite? de son mouvement (c. de l'argent) supple? e a` sa quantite? . Lorsqu'il en est besoin il ne fait que glisser d'une main dans l'autre sans s'arre^ter un instant. ? [--It is products which set it? (money) --in motion and make it circulate . . . The velocity of its? (money's) --motion supplements its quantity. When necessary, it does nothing but slide from hand to hand, without stopping for a moment? ] (Le Trosne, l. c. . pp. 915, 916. )
30 --Money being . . . the common measure of buying and selling, everybody who hath anything to sell, and cannot procure chapmen for it, is presently apt to think, that want of money in the. kingdom, or country, is the cause why his goods do not go off; and so, want of money is the common cry; which is a great mistake. . . What do these people want, who cry out for money? . . . The farmer complains . . . he thinks that were more money in the country; he should have a price for his goods. Then it seems money is not his want, but a price for his corn and cattel, which he would sell, but cannot. . . Why cannot he get a price? . . . (1) Either there is too much corn and cattel in the country, so that most who come to market have need of selling, as he hash, and few of buying; or (2) There wants the usual vent abroad by transportation. . . , or (3) The consumption fails, as when men, by reason of poverty, do not spend so much in their houses as formerly they did; wherefore it is not the increase of specific money, which would at all advance the farmer's goods, but the removal of any of these three causes, which do truly keep down the market. . . The merchant and shopkeeper want money in the same manner, that is, they want a vent for the goods they deal in, by reason that the markets fail? . . . [A nation] --never thrives better, than when riches are tost from hand to hand. ? (Sir Dudley North: --Discourses upon Trade,? Lond. 1691, pp. 11-15, passim. ) Herrenschwand's fanciful notions amount merely to this, that the antagonism, which has its origin in the nature of commodities, and is reproduced in their circulation, can be removed by increasing the circulating medium. But if, on the one hand, it is a popular delusion to ascribe stagnation in production and circulation to insufficiency of the circulating medium, it by no means follows, on the other hand, that an actual paucity of the medium in consequence, e. g. , of bungling legislative interference with the regulation of currency, may not give rise to such stagnation.
31 --There is a certain measure and proportion of money requisite to drive the trade of a nation, more or less than which would prejudice the same. lust as there is a certain proportion of farthings necessary in
? ? 94 Chapter 3
a small retail trade, to change silver money, and to even such reckonings as cannot be adjusted with the smallest silver pieces. . . . Now, as the proportion of the number of farthings requisite in commerce is to be taken from the number of people, the frequency of their exchanges: as also, and principally, from the value of the smallest silver pieces of money; so in like manner, the proportion of money [gold and silver specie] requisite in our trade, is to be likewise taken from the frequency of commutations, and from the bigness of the payments. ? (William Petty, --A Treatise of Taxes and Contributions. ? Lond. 1667, p. 17. ) The Theory of Hume was defended against the attacks of J. Steuart and others, by A. Young, in his --Political Arithmetic,? Lond; 1774, in which work there is a special chapter entitled --Prices depend on quantity of money, at p. 112, sqq. I have stated in --Zur Kritik, &c. ,? p. 149: --He (Adam Smith) passes over without remark the question as to the quantity of coin in circulation, and treats money quite wrongly as a mere commodity. ? This statement applies only in so far as Adam Smith, ex officio, treats of money. Now and then, however, as in his criticism of the earlier systems of Political Economy, he takes the right view. --The quantity of coin in every country is regulated by the value of the commodities which are to be circulated by It. . . . The value of the goods annually bought and sold in any country requires a certain quantity of money to circulate and distribute them to their proper consumers, and can give employment to no more. The channel of circulation necessarily draws to itself a sum sufficient to fill it, and never admits any more. ? (--Wealth of Nations. ? Bk. IV. , ch. 1. ) In like manner, ex officio, he opens his work with an apotheosis on the division of labour. Afterwards, in the last book which treats of the sources of public revenue, he occasionally repeats the denunciations of the division of labour made by his teacher, A. Ferguson.
32 --The prices of things will certainly rise in every nation, as the gold and silver increase amongst the people, and consequently, where the gold and silver decrease in any nation, the prices of all things must fall proportionately to such decrease of money. ? (Jacob Vanderlint: --Money Answers all Things. ? Lond. 1734, p. 5. ) A careful comparison of thus book with Hume's --Essays,? proves to my mind without doubt that Hume was acquainted with and made use of Vanderlint's work, which is certainly an important one. The opinion that prices are determined by the quantity of the circulating medium, was also held by Barbon and other much earlier writers. --No inconvenience,? says Vanderlint, --can arise by an unrestrained trade, but very great advantage; since, if the cash of the nation be decreased by it, which prohibitions are designed to prevent, those nations that get the cash will certainly find everything advance in price, as the cash increases amongst them. And . . . our manufactures, and everything else, will soon become so moderate as to turn the balance of trade in our favour, and thereby fetch the money back again. ? (l. c. . pp. 43, 44. )
33 That the price of each single kind of commodity forms a pan of the sum of the prices of all the commodities in circulation, is a self-evident proposition. But how use-values which are incommensurable with regard to each other, are to be exchanged, en masse for the total sum of gold and silver in a country, is quite incomprehensible. If we start from the notion that all commodities together form one single commodity, of which each is but an aliquot part, we get the following beautiful result: The total commodity = x cwt. of gold; commodity A = an aliquot part of the total commodity = the same aliquot part of x cwt. of gold. This is stated in all seriousness by Montesquieu: --Si l'on compare la masse de l'or et de l'argent qui est dans le monde avec la somme des marchandises qui s'y vend il est certain que chaque denre? e ou marchandise, en particulier, pourra e^tre compare? e a` une certaine portion de la masse entie`re. Supposons qu'il n'y ait qu'une seule denre? e ou marchandise dans le monde, ou qu'il n'y ait qu'une seule qui s'ache`te, et qu'elle se divise comme l'argent: Cette partie de cette marchandise re? pondra a` une partie de la masse de l'argent; la moitie? du total de l'une a` la moitie? du total de l'autre, &c. . . . L'e? tablissement du prix des choses de? pend toujours fondamentalement de la raison du total des choses au total des signes. ? [--If one compares the amount of gold and silver in the world with the sum of the commodities available, it is certain that each product or commodity, taken in isolation, could be compared with a certain portion of the total amount
? ? 95 Chapter 3
of money. Let us suppose that there is only one product, or commodity, in the world, or only one that can be purchased, and that it can be divided in the same way as money: a certain part of this commodity would then correspond to a part of the total amount of money; half the total of the one would correspond to half the total of the other &. . . . the determination of the prices of things always depends, fundamentally, on the relation between the total amount of things and the total amount of their monetary symbols? ] (Montesquieu, l. c. t. III, pp. 12, 13. ) As to the further development of this theory by Ricardo and his disciples, James Mill, Lord Overstone, and others, see --Zur Kritik, &c. ,? pp. 140-146, and p. 150, sqq. John Stuart Mill, with his usual eclectic logic, understands how to hold at the same time the view of his father, James Mill, and the opposite view. On a comparison of the text of his compendium, --Principles of Pol. Econ. ,? with his preface to the first edition, in which preface he announces himself as the Adam Smith of his day -- we do not know whether to admire more the simplicity of the man, or that of the public, who took him, in good faith, for the Adam Smith he announced himself to be, although he bears about as much resemblance to Adam Smith as say General Williams, of Kars, to the Duke of Wellington. The original researches of Mr. J. S. Mill which are neither extensive nor profound, in the domain of Political Economy, will be found mustered in rank and file in his little work, --Some Unsettled Questions of Political Economy,? which appeared in 1844. Locke asserts point blank the connexion between the absence of value in gold and silver, and the determination of their values by quantity alone. --Mankind having consented to put an imaginary value upon gold and silver . . . the intrinsic value, regarded in these metals, is nothing but the quantity. " (--Some Considerations,? &c. , 1691, Works Ed. 1777, Vol. II. , p. 15. )
34 It lies of course, entirely beyond my purpose to take into consideration such details as the s
eigniorage on minting. I will, however, cite for the benefit of the romantic sycophant, Adam Muller, who admires the --generous liberality?
with which the English Government coins gratuitously, the following opinion of Sir Dudley North: --Silver and gold, like other commodities, have their ebbings and flowings. Upon the arrival of quantities from Spain . . . it is carried into the Tower, and coined. Not long after there will come a demand for bullion to be exported again. If there is none, but all happens to be in coin, what then? Melt it down again; there's no loss in it, for the coining costs the owner nothing. Thus the nation has been abused, and made to pay for the twisting of straw for asses to eat. If the merchant were made to pay the price of the coinage, he would not have sent his silver to the Tower without consideration, and coined money would always keep a value above uncoined silver. ? (North, l. c. , p. 18. ) North was himself one of the foremost merchants in the reign of Charles II.
35 --If silver never exceed what is wanted for the smaller payments it cannot be collected in sufficient quantities for the larger payments . . . the use of gold in the main payments necessarily implies also Its use in the retail trade: those who have gold coin offering them for small purchases, and receiving with the commodity purchased a balance of silver in return; by which means the surplus of silver that would otherwise encumber the retail dealer, is drawn off and dispersed into general circulation. But if there is as much silver as will transact the small payments independent of gold, the retail trader must then receive silver for small purchases ; and it must of necessity accumulate in his hands. ? (David Buchanan; --Inquiry into the Taxation and Commercial Policy of Great Britain. ? Edinburgh, 1844, pp. 248, 249. )
36 The mandarin Wan-mao-in, the Chinese Chancellor of the Exchequer, took it into his head one day to lay before the Son of Heaven a proposal that secretly aimed at converting the assignats of the empire into convertible bank-notes. The assignats Committee, in its report of April, 1854, gives him a severe snubbing. Whether he also received the traditional drubbing with bamboos is not stated. The concluding part of the report is as follows: -- --The Committee has carefully examined his proposal and finds that it is entirely in favour of the merchants, and that no advantage will result to the crown. ? (--Arbeiten der Kaiserlich Russischen Gesandtschaft zu Peking u? ber China. ? Aus dem Russischen von Dr. K. Abel und F. A. Mecklenburg. Erster Band. Berlin, 1858, p. 47 sq. ) In his evidence before the
? ? 96 Chapter 3
Committee of the House of Lords on the Bank Acts, a governor of the Bank of England says, with regard to the abrasion of gold coins during currency: --Every year a fresh class of sovereigns becomes too light. The class which one year passes with full weight, loses enough by wear and tear to draw the scales next year against it. ? (House of Lords' Committee, 1848, n. 429. )
37 The following passage from Fullarton shows the want of clearness on the pan of even the best writers on money, in their comprehension of its various functions: --That, as far as concerns our domestic exchanges, all the monetary functions which are usually performed by gold and silver coins, may be performed as effectually by a circulation of inconvertible notes paying no value but that factitious and conventional value they derive from the law is a fact which admits, I conceive, of no denial. Value of this description may be made to answer all the purposes of intrinsic value, and supersede even the necessity for a standard, provided only the quantity of issues be kept under due limitation. ? (Fullerton: --Regulation of Currencies,? London, 1845, p. 21. ) Because the commodity that serves as money is capable of being replaced in circulation by mere symbols of value, therefore its functions as a measure of value and a standard of prices are declared to be superfluous!
38 From the fact that gold and silver, so far as they are coins, or exclusively serve as the medium of circulation, become mere tokens of themselves, Nicholas Barbon deduces the right of Governments --to raise money,? that is, to give to the weight of silver that is called a shilling the name of a greater weight, such as a crown; and so to pay creditors shillings, instead of crowns. --Money does wear and grow lighter by often telling over. . . It is the denomination and currency of the money that men regard in bargaining, and not the quantity of silver. . . 'Tis the public authority upon the metal that makes it money. ? (N. Barbon, l. c. , pp. 29, 30, 25. )
39 --Une richesse en argent n'est que . . . richesse en productions, converties en argent. ? [--Monetary wealth is nothing but . . . wealth in products, transformed into money? ] (Mercier de la Rivie`re, l. c. ) --Une valeur en productions n'a fait que changer de forme. ? [--A value in the form of products, which has merely changed its form. ? ] (Id. , p. 486. )
40 --'Tis by this practice' they keep all their goods and manufactures at such low rates. ? (Vanderlint, l. c. , pp. 95, 96. )
41 --Money . . . is a pledge. ? (John Bellers: --Essays about the Poor, Manufactures, Trade, Plantations, and Immorality,? Lond. , 1699, p. 13. )
42 A purchase. in a --categorical? sense, implies that gold and silver are already the converted form of commodities, or the product of a sale.
43 Henry III. , most Christian king of France, robbed cloisters of their relics, and turned them into money. It is well known what part the despoiling of the Delphic Temple, by the Phocians, played in the history of Greece. Temples with the ancients served as the dwellings of the gods of commodities. They were --sacred banks. ? With the Phoenicians, a trading people par excellence, money was the transmuted shape of everything. It was, therefore, quite in order that the virgins, who, at the feast of the Goddess of Love, gave themselves up to strangers, should offer to the goddess the piece of money
they received.
? 43a
--Gold, yellow, glittering, precious gold!
Thus much of this, will make black white, foul, fair; Wrong, right; base, noble; old, young; coward, valiant. . . . What this, you gods? Why, this
Will lug your priests and servants from your sides; Pluck stout men's pillows from below their heads; This yellow slave
Will knit and break religions; bless the accurs'd;
? 97
Chapter 3
? Make the hoar leprosy ador'd; place thieves, And give them title, knee and approbation; With senators on the bench, this is it;
That makes the wappen'd widow wed again: . . . Come damned earth,
Though common whore of mankind. " (Shakespeare: Timon of Athens. )
43b (Sophocles, Antigone. )
44 The desire of avarice to draw Pluto himself out of the bowels of the earth. ? (The Deipnosophistst, VI, 23, Athenaeus)
45 --Accrescere quanto piu` si puo` il numero de'venditori d'ogni merce, diminuere quanto piu` si puo il numero dei compratori, quest) sono i cardini sui quali si raggirano tutte le operazioni di economia politica. ? [--These are the pivots around which all the measures of political economy turn: the maximum possible increase in the number of sellers of each commodity, and the maximum possible decrease in the number of buyers? ] (Verri, l. c. , p. 52. )
46 --There is required for carrying on the trade of the nation a determinate sum of specifick money which varies, and is sometimes more, sometimes less, as the circumstances we are in require. . . . This ebbing and flowing of money supplies and accommodates itself, without any aid of Politicians. . . . The buckets work alternately; when money is scarce, bullion is coined; when bullion is scarce, money is melted. ? (Sir D. North, l. c. , Postscript, p. 3. ) John Stuart Mill, who for a long time was an official of the East India Company, confirms the fact that in India silver ornaments still continue to perform directly the functions of a hoard. The silver ornaments are brought out and coined when there is a high rate of interest, and go back again when the rate of interest falls. (J. S. Mill's Evidence --Reports on Bank Acts,? 1857, 2084. ) According to a Parliamentary document of 1864 on the gold and silver import and export of India, the import of gold and silver in 1863 exceeded the export by ? 19,367,764. During the 8 years immediately preceding 1864, the excess of imports over exports of the precious metals amounted to ? 109,652,917. During this century far more than ? 200,000,000 has been coined in India.
47 The following shows the debtor and creditor relations existing between English traders at the beginning of the 18th century. --Such a spirit of crudity reigns here in England among the men of trade, that is not to be met with in any other society of men, nor in any other kingdom of the world. ? (--An Essay on Credit and the Bankrupt Act,? Lond. ,
48 It will be seen from the following quotation from my book which appeared in 1859, why I take no notice in the text of an opposite form: --Contrariwise, in the process in M--C, the money can be alienated as a real means of purchase, and in that way, the price of the commodity can be realised before the use-value of the money is realised and the commodity actually delivered. This occurs constantly under the every-day form of prepayments. And it is under this form, that the English government purchases opium from the ryots of India. . . . In these cases, however, the money always acts as a means of purchase. . . . Of course capital also is advanced in the shape of money. . . . This point of view, however, does not fall within the horizon of simple circulation. ? (--Zur Kritik, &c. ,? pp. 119, 120. )
49 The monetary crisis referred to in the text, being a phase of every crisis, must be clearly distinguished from that particular form of crisis, which also is called a monetary crisis, but which may be produced by itself as an independent phenomenon in such a way as to react only indirectly on industry and commerce. The pivot of these crises is to be found in moneyed capital, and their sphere of direct action is therefore the sphere of that capital, viz. , banking, the stock exchange, and finance.
? 98 Chapter 3
50 --The sudden reversion from a system of credit to a system of hard cash heaps theoretical fright on top of the practical panic; and the dealers by whose agency circulation is affected, shudder before the impenetrable mystery in which their own economic relations are involved? (Karl Marx, l. c. , p. 126. ) --The poor stand still, because the rich have no money to employ them, though they have the same land and hands to provide victuals and clothes, as ever they had; .
29 --Ce sont les productions qui le (l'argent) mettent en mouvement et le font circuler . . . La ce? le? rite? de son mouvement (c. de l'argent) supple? e a` sa quantite? . Lorsqu'il en est besoin il ne fait que glisser d'une main dans l'autre sans s'arre^ter un instant. ? [--It is products which set it? (money) --in motion and make it circulate . . . The velocity of its? (money's) --motion supplements its quantity. When necessary, it does nothing but slide from hand to hand, without stopping for a moment? ] (Le Trosne, l. c. . pp. 915, 916. )
30 --Money being . . . the common measure of buying and selling, everybody who hath anything to sell, and cannot procure chapmen for it, is presently apt to think, that want of money in the. kingdom, or country, is the cause why his goods do not go off; and so, want of money is the common cry; which is a great mistake. . . What do these people want, who cry out for money? . . . The farmer complains . . . he thinks that were more money in the country; he should have a price for his goods. Then it seems money is not his want, but a price for his corn and cattel, which he would sell, but cannot. . . Why cannot he get a price? . . . (1) Either there is too much corn and cattel in the country, so that most who come to market have need of selling, as he hash, and few of buying; or (2) There wants the usual vent abroad by transportation. . . , or (3) The consumption fails, as when men, by reason of poverty, do not spend so much in their houses as formerly they did; wherefore it is not the increase of specific money, which would at all advance the farmer's goods, but the removal of any of these three causes, which do truly keep down the market. . . The merchant and shopkeeper want money in the same manner, that is, they want a vent for the goods they deal in, by reason that the markets fail? . . . [A nation] --never thrives better, than when riches are tost from hand to hand. ? (Sir Dudley North: --Discourses upon Trade,? Lond. 1691, pp. 11-15, passim. ) Herrenschwand's fanciful notions amount merely to this, that the antagonism, which has its origin in the nature of commodities, and is reproduced in their circulation, can be removed by increasing the circulating medium. But if, on the one hand, it is a popular delusion to ascribe stagnation in production and circulation to insufficiency of the circulating medium, it by no means follows, on the other hand, that an actual paucity of the medium in consequence, e. g. , of bungling legislative interference with the regulation of currency, may not give rise to such stagnation.
31 --There is a certain measure and proportion of money requisite to drive the trade of a nation, more or less than which would prejudice the same. lust as there is a certain proportion of farthings necessary in
? ? 94 Chapter 3
a small retail trade, to change silver money, and to even such reckonings as cannot be adjusted with the smallest silver pieces. . . . Now, as the proportion of the number of farthings requisite in commerce is to be taken from the number of people, the frequency of their exchanges: as also, and principally, from the value of the smallest silver pieces of money; so in like manner, the proportion of money [gold and silver specie] requisite in our trade, is to be likewise taken from the frequency of commutations, and from the bigness of the payments. ? (William Petty, --A Treatise of Taxes and Contributions. ? Lond. 1667, p. 17. ) The Theory of Hume was defended against the attacks of J. Steuart and others, by A. Young, in his --Political Arithmetic,? Lond; 1774, in which work there is a special chapter entitled --Prices depend on quantity of money, at p. 112, sqq. I have stated in --Zur Kritik, &c. ,? p. 149: --He (Adam Smith) passes over without remark the question as to the quantity of coin in circulation, and treats money quite wrongly as a mere commodity. ? This statement applies only in so far as Adam Smith, ex officio, treats of money. Now and then, however, as in his criticism of the earlier systems of Political Economy, he takes the right view. --The quantity of coin in every country is regulated by the value of the commodities which are to be circulated by It. . . . The value of the goods annually bought and sold in any country requires a certain quantity of money to circulate and distribute them to their proper consumers, and can give employment to no more. The channel of circulation necessarily draws to itself a sum sufficient to fill it, and never admits any more. ? (--Wealth of Nations. ? Bk. IV. , ch. 1. ) In like manner, ex officio, he opens his work with an apotheosis on the division of labour. Afterwards, in the last book which treats of the sources of public revenue, he occasionally repeats the denunciations of the division of labour made by his teacher, A. Ferguson.
32 --The prices of things will certainly rise in every nation, as the gold and silver increase amongst the people, and consequently, where the gold and silver decrease in any nation, the prices of all things must fall proportionately to such decrease of money. ? (Jacob Vanderlint: --Money Answers all Things. ? Lond. 1734, p. 5. ) A careful comparison of thus book with Hume's --Essays,? proves to my mind without doubt that Hume was acquainted with and made use of Vanderlint's work, which is certainly an important one. The opinion that prices are determined by the quantity of the circulating medium, was also held by Barbon and other much earlier writers. --No inconvenience,? says Vanderlint, --can arise by an unrestrained trade, but very great advantage; since, if the cash of the nation be decreased by it, which prohibitions are designed to prevent, those nations that get the cash will certainly find everything advance in price, as the cash increases amongst them. And . . . our manufactures, and everything else, will soon become so moderate as to turn the balance of trade in our favour, and thereby fetch the money back again. ? (l. c. . pp. 43, 44. )
33 That the price of each single kind of commodity forms a pan of the sum of the prices of all the commodities in circulation, is a self-evident proposition. But how use-values which are incommensurable with regard to each other, are to be exchanged, en masse for the total sum of gold and silver in a country, is quite incomprehensible. If we start from the notion that all commodities together form one single commodity, of which each is but an aliquot part, we get the following beautiful result: The total commodity = x cwt. of gold; commodity A = an aliquot part of the total commodity = the same aliquot part of x cwt. of gold. This is stated in all seriousness by Montesquieu: --Si l'on compare la masse de l'or et de l'argent qui est dans le monde avec la somme des marchandises qui s'y vend il est certain que chaque denre? e ou marchandise, en particulier, pourra e^tre compare? e a` une certaine portion de la masse entie`re. Supposons qu'il n'y ait qu'une seule denre? e ou marchandise dans le monde, ou qu'il n'y ait qu'une seule qui s'ache`te, et qu'elle se divise comme l'argent: Cette partie de cette marchandise re? pondra a` une partie de la masse de l'argent; la moitie? du total de l'une a` la moitie? du total de l'autre, &c. . . . L'e? tablissement du prix des choses de? pend toujours fondamentalement de la raison du total des choses au total des signes. ? [--If one compares the amount of gold and silver in the world with the sum of the commodities available, it is certain that each product or commodity, taken in isolation, could be compared with a certain portion of the total amount
? ? 95 Chapter 3
of money. Let us suppose that there is only one product, or commodity, in the world, or only one that can be purchased, and that it can be divided in the same way as money: a certain part of this commodity would then correspond to a part of the total amount of money; half the total of the one would correspond to half the total of the other &. . . . the determination of the prices of things always depends, fundamentally, on the relation between the total amount of things and the total amount of their monetary symbols? ] (Montesquieu, l. c. t. III, pp. 12, 13. ) As to the further development of this theory by Ricardo and his disciples, James Mill, Lord Overstone, and others, see --Zur Kritik, &c. ,? pp. 140-146, and p. 150, sqq. John Stuart Mill, with his usual eclectic logic, understands how to hold at the same time the view of his father, James Mill, and the opposite view. On a comparison of the text of his compendium, --Principles of Pol. Econ. ,? with his preface to the first edition, in which preface he announces himself as the Adam Smith of his day -- we do not know whether to admire more the simplicity of the man, or that of the public, who took him, in good faith, for the Adam Smith he announced himself to be, although he bears about as much resemblance to Adam Smith as say General Williams, of Kars, to the Duke of Wellington. The original researches of Mr. J. S. Mill which are neither extensive nor profound, in the domain of Political Economy, will be found mustered in rank and file in his little work, --Some Unsettled Questions of Political Economy,? which appeared in 1844. Locke asserts point blank the connexion between the absence of value in gold and silver, and the determination of their values by quantity alone. --Mankind having consented to put an imaginary value upon gold and silver . . . the intrinsic value, regarded in these metals, is nothing but the quantity. " (--Some Considerations,? &c. , 1691, Works Ed. 1777, Vol. II. , p. 15. )
34 It lies of course, entirely beyond my purpose to take into consideration such details as the s
eigniorage on minting. I will, however, cite for the benefit of the romantic sycophant, Adam Muller, who admires the --generous liberality?
with which the English Government coins gratuitously, the following opinion of Sir Dudley North: --Silver and gold, like other commodities, have their ebbings and flowings. Upon the arrival of quantities from Spain . . . it is carried into the Tower, and coined. Not long after there will come a demand for bullion to be exported again. If there is none, but all happens to be in coin, what then? Melt it down again; there's no loss in it, for the coining costs the owner nothing. Thus the nation has been abused, and made to pay for the twisting of straw for asses to eat. If the merchant were made to pay the price of the coinage, he would not have sent his silver to the Tower without consideration, and coined money would always keep a value above uncoined silver. ? (North, l. c. , p. 18. ) North was himself one of the foremost merchants in the reign of Charles II.
35 --If silver never exceed what is wanted for the smaller payments it cannot be collected in sufficient quantities for the larger payments . . . the use of gold in the main payments necessarily implies also Its use in the retail trade: those who have gold coin offering them for small purchases, and receiving with the commodity purchased a balance of silver in return; by which means the surplus of silver that would otherwise encumber the retail dealer, is drawn off and dispersed into general circulation. But if there is as much silver as will transact the small payments independent of gold, the retail trader must then receive silver for small purchases ; and it must of necessity accumulate in his hands. ? (David Buchanan; --Inquiry into the Taxation and Commercial Policy of Great Britain. ? Edinburgh, 1844, pp. 248, 249. )
36 The mandarin Wan-mao-in, the Chinese Chancellor of the Exchequer, took it into his head one day to lay before the Son of Heaven a proposal that secretly aimed at converting the assignats of the empire into convertible bank-notes. The assignats Committee, in its report of April, 1854, gives him a severe snubbing. Whether he also received the traditional drubbing with bamboos is not stated. The concluding part of the report is as follows: -- --The Committee has carefully examined his proposal and finds that it is entirely in favour of the merchants, and that no advantage will result to the crown. ? (--Arbeiten der Kaiserlich Russischen Gesandtschaft zu Peking u? ber China. ? Aus dem Russischen von Dr. K. Abel und F. A. Mecklenburg. Erster Band. Berlin, 1858, p. 47 sq. ) In his evidence before the
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Committee of the House of Lords on the Bank Acts, a governor of the Bank of England says, with regard to the abrasion of gold coins during currency: --Every year a fresh class of sovereigns becomes too light. The class which one year passes with full weight, loses enough by wear and tear to draw the scales next year against it. ? (House of Lords' Committee, 1848, n. 429. )
37 The following passage from Fullarton shows the want of clearness on the pan of even the best writers on money, in their comprehension of its various functions: --That, as far as concerns our domestic exchanges, all the monetary functions which are usually performed by gold and silver coins, may be performed as effectually by a circulation of inconvertible notes paying no value but that factitious and conventional value they derive from the law is a fact which admits, I conceive, of no denial. Value of this description may be made to answer all the purposes of intrinsic value, and supersede even the necessity for a standard, provided only the quantity of issues be kept under due limitation. ? (Fullerton: --Regulation of Currencies,? London, 1845, p. 21. ) Because the commodity that serves as money is capable of being replaced in circulation by mere symbols of value, therefore its functions as a measure of value and a standard of prices are declared to be superfluous!
38 From the fact that gold and silver, so far as they are coins, or exclusively serve as the medium of circulation, become mere tokens of themselves, Nicholas Barbon deduces the right of Governments --to raise money,? that is, to give to the weight of silver that is called a shilling the name of a greater weight, such as a crown; and so to pay creditors shillings, instead of crowns. --Money does wear and grow lighter by often telling over. . . It is the denomination and currency of the money that men regard in bargaining, and not the quantity of silver. . . 'Tis the public authority upon the metal that makes it money. ? (N. Barbon, l. c. , pp. 29, 30, 25. )
39 --Une richesse en argent n'est que . . . richesse en productions, converties en argent. ? [--Monetary wealth is nothing but . . . wealth in products, transformed into money? ] (Mercier de la Rivie`re, l. c. ) --Une valeur en productions n'a fait que changer de forme. ? [--A value in the form of products, which has merely changed its form. ? ] (Id. , p. 486. )
40 --'Tis by this practice' they keep all their goods and manufactures at such low rates. ? (Vanderlint, l. c. , pp. 95, 96. )
41 --Money . . . is a pledge. ? (John Bellers: --Essays about the Poor, Manufactures, Trade, Plantations, and Immorality,? Lond. , 1699, p. 13. )
42 A purchase. in a --categorical? sense, implies that gold and silver are already the converted form of commodities, or the product of a sale.
43 Henry III. , most Christian king of France, robbed cloisters of their relics, and turned them into money. It is well known what part the despoiling of the Delphic Temple, by the Phocians, played in the history of Greece. Temples with the ancients served as the dwellings of the gods of commodities. They were --sacred banks. ? With the Phoenicians, a trading people par excellence, money was the transmuted shape of everything. It was, therefore, quite in order that the virgins, who, at the feast of the Goddess of Love, gave themselves up to strangers, should offer to the goddess the piece of money
they received.
? 43a
--Gold, yellow, glittering, precious gold!
Thus much of this, will make black white, foul, fair; Wrong, right; base, noble; old, young; coward, valiant. . . . What this, you gods? Why, this
Will lug your priests and servants from your sides; Pluck stout men's pillows from below their heads; This yellow slave
Will knit and break religions; bless the accurs'd;
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? Make the hoar leprosy ador'd; place thieves, And give them title, knee and approbation; With senators on the bench, this is it;
That makes the wappen'd widow wed again: . . . Come damned earth,
Though common whore of mankind. " (Shakespeare: Timon of Athens. )
43b (Sophocles, Antigone. )
44 The desire of avarice to draw Pluto himself out of the bowels of the earth. ? (The Deipnosophistst, VI, 23, Athenaeus)
45 --Accrescere quanto piu` si puo` il numero de'venditori d'ogni merce, diminuere quanto piu` si puo il numero dei compratori, quest) sono i cardini sui quali si raggirano tutte le operazioni di economia politica. ? [--These are the pivots around which all the measures of political economy turn: the maximum possible increase in the number of sellers of each commodity, and the maximum possible decrease in the number of buyers? ] (Verri, l. c. , p. 52. )
46 --There is required for carrying on the trade of the nation a determinate sum of specifick money which varies, and is sometimes more, sometimes less, as the circumstances we are in require. . . . This ebbing and flowing of money supplies and accommodates itself, without any aid of Politicians. . . . The buckets work alternately; when money is scarce, bullion is coined; when bullion is scarce, money is melted. ? (Sir D. North, l. c. , Postscript, p. 3. ) John Stuart Mill, who for a long time was an official of the East India Company, confirms the fact that in India silver ornaments still continue to perform directly the functions of a hoard. The silver ornaments are brought out and coined when there is a high rate of interest, and go back again when the rate of interest falls. (J. S. Mill's Evidence --Reports on Bank Acts,? 1857, 2084. ) According to a Parliamentary document of 1864 on the gold and silver import and export of India, the import of gold and silver in 1863 exceeded the export by ? 19,367,764. During the 8 years immediately preceding 1864, the excess of imports over exports of the precious metals amounted to ? 109,652,917. During this century far more than ? 200,000,000 has been coined in India.
47 The following shows the debtor and creditor relations existing between English traders at the beginning of the 18th century. --Such a spirit of crudity reigns here in England among the men of trade, that is not to be met with in any other society of men, nor in any other kingdom of the world. ? (--An Essay on Credit and the Bankrupt Act,? Lond. ,
48 It will be seen from the following quotation from my book which appeared in 1859, why I take no notice in the text of an opposite form: --Contrariwise, in the process in M--C, the money can be alienated as a real means of purchase, and in that way, the price of the commodity can be realised before the use-value of the money is realised and the commodity actually delivered. This occurs constantly under the every-day form of prepayments. And it is under this form, that the English government purchases opium from the ryots of India. . . . In these cases, however, the money always acts as a means of purchase. . . . Of course capital also is advanced in the shape of money. . . . This point of view, however, does not fall within the horizon of simple circulation. ? (--Zur Kritik, &c. ,? pp. 119, 120. )
49 The monetary crisis referred to in the text, being a phase of every crisis, must be clearly distinguished from that particular form of crisis, which also is called a monetary crisis, but which may be produced by itself as an independent phenomenon in such a way as to react only indirectly on industry and commerce. The pivot of these crises is to be found in moneyed capital, and their sphere of direct action is therefore the sphere of that capital, viz. , banking, the stock exchange, and finance.
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50 --The sudden reversion from a system of credit to a system of hard cash heaps theoretical fright on top of the practical panic; and the dealers by whose agency circulation is affected, shudder before the impenetrable mystery in which their own economic relations are involved? (Karl Marx, l. c. , p. 126. ) --The poor stand still, because the rich have no money to employ them, though they have the same land and hands to provide victuals and clothes, as ever they had; .
