Grundrisse: Notebook I – The Chapter on Money
Fourthly: Just as exchange value, in the form of money, takes its place as the general commodity alongside all particular commodities, so does exchange value as money therefore at the same time take its place as a particular commodity (since it has a particular existence) alongside all other commodities. An incongruency arises not only because money, which exists only in exchange, confronts the particular exchangeability of commodities as their general exchangeability, and directly extinguishes it, while, nevertheless, the two are supposed to be always convertible into one another; but also because money comes into contradiction with itself and with its characteristic by virtue of being itself a particular commodity (even if only a symbol) and of being subject, therefore, to particular conditions of exchange in its exchange with other commodities, conditions which contradict its general unconditional exchangeability. (Not to speak of money as fixed in the substance of a particular product, etc.) Besides its existence in the commodity, exchange value achieved an existence of its own in money, was separated from its substance exactly because the natural characteristic of this substance contradicted its general characteristic as exchange value. Every commodity is equal (and comparable) to every other as exchange value (qualitatively: each now merely represents a quantitative plus or minus of exchange value). For that reason, this equality, this unity of the commodity is distinct from its natural differentiation; and appears in money therefore as their common element as well as a third thing which confronts them both. But on one side, exchange value naturally remains at the same time an inherent quality of commodities while it simultaneously exists outside them; on the other side, when money no longer exists as a property of commodities, as a common element within them, but as an individual entity apart from them, then money itself becomes a particular commodity alongside the other commodities. (Determinable by demand and supply; splits into different kinds of money, etc.) It becomes a commodity like other commodities, and at the same time it is not a commodity like other commodities. Despite its general character it is one exchangeable entity among other exchangeable entities. It is not only the general exchange value, but at the same time a particular exchange value alongside other particular exchange values. Here a new source of contradictions which make themselves felt in practice. (The particular nature of money emerges again in the separation of the money business from commerce proper.)
We see, then, how it is an inherent property of money to fulfil its purposes by simultaneously negating them; to achieve independence from commodities; to be a means which becomes an end; to realize the exchange value of commodities by separating them from it; to facilitate exchange by splitting it; to overcome the difficulties of the direct exchange of commodities by generalizing them; to make exchange independent of the producers in the same measure as the producers become dependent on exchange.
(It will be necessary later, before this question is dropped, to correct the idealist manner of the presentation, which makes it seem as if it were merely a matter of conceptual determinations and of the dialectic of these concepts. Above all in the case of the phrase: product (or activity) becomes commodity; commodity, exchange value; exchange value, money.)
(Economist. 24 January 1857. The following passage to be borne in mind on the subject of banks:
‘So far as the mercantile classes share, which they now do very generally, in the profits of banks – and may to a still greater extent by the wider diffusion of joint-stock banks, the abolition of all corporate privileges, and the extension of perfect freedom to the business of banking – they have been enriched by the increased rates of money. In truth, the mercantile classes by the extent of their deposits, are virtually their own bankers; and so far as that is the case, the rate of discount must be to them of little importance. All banking and other reserves must of course be the results of continual industry, and of savings laid by out of profits; and consequently, taking the mercantile and industrious classes as a whole, they must be their own bankers, and it requires only that the principles of free trade should be extended to all businesses, to equalize or naturalize for them the advantages and disadvantages of all the fluctuations in the money market.’)
All contradictions of the monetary system and of the exchange of products under the monetary system are the development of the relation of products as exchange values, of their definition as exchange value or as value pure and simple.
(Morning Star. 12 February 1857. ‘The pressure of money during last year, and the high rate of discount which was adopted in consequence, has been very beneficial to the profit account of the Bank of France. Its dividend has gone on increasing: 118 fr. in 1852, 154 fr. in 1853, 194 fr. in 1854, 200 fr. in 1855, 272 fr. in 1856.’)
Also to be noted, the following passage: The English silver coins issued at a price higher than the value of the silver they contain. A pound silver of an intrinsic value of 60–62s. (£3 on an average in gold) was coined into 66s. The Mint pays the ‘market price of the day, from 5s. to 5s. 2d. the ounce, and issues at the rate of 5s. 6d. the ounce. There are two reasons which prevent any practical inconvenience resulting from this arrangement:’ (of silver tokens, not of intrinsic value) ‘first, the coin can only be procured at the Mint, and at that price; as home circulation, then, it cannot be depreciated, and it cannot be sent abroad because it circulates here for more than its intrinsic value; and secondly, as it is a legal tender only up to 40s., it never interferes with the gold coins, nor affects their value.’ Gives France the advice to do the same: to issue subordinate coins of silver tokens, not of intrinsic value, and limit[ing] the amount to which they should be a legal tender. But at the same time: in fixing the quality of the coin, to take a larger margin between the intrinsic and the nominal value than we have in England, because the increasing value of silver in relation to gold may very probably, before long, rise up to our present Mint price, when we may be obliged again to alter it. Our silver coin is now little more than 5% below the intrinsic value: a short time since it was 10%. (Economist. 24 January 1857.)
Now, it might be thought that the issue of time-chits overcomes all these difficulties. (The existence of the time-chit naturally already presupposes conditions which are not directly given in the examination of the relations of exchange value and money, and which can and do exist without the time-chit: public credit, bank etc.; but all this not to be touched on further here, since the time-chit men of course regard it as the ultimate product of the ‘series’, which, even if it corresponds most to the ‘pure’ concept of money, ‘appears’ last in reality.) To begin with: If the preconditions under which the price of commodities = their exchange value are fulfilled and given; balance of demand and supply; balance of production and consumption; and what this amounts to in the last analysis, proportionate production (the so-called relations of distribution are themselves relations of production), then the money question becomes entirely secondary, in particular the question whether the tickets should be blue or green, paper or tin, or whatever other form social accounting should take. In that case it is totally meaningless to keep up the pretence that an investigation is being made of the real relations of money.
The bank (any bank) issues the time-chits.  A commodity, A = the exchange value x, i.e. = x hours of labour time, is exchanged for a quantity of money representing x labour time. The bank would at the same time have to purchase the commodity, i.e. exchange it for its representative in monetary form, just as e.g. the Bank of England today has to give notes for gold. The commodity, the substantial and therefore accidental existence of exchange value, is exchanged for the symbolic existence of exchange value as exchange value. There is then no difficulty in transposing it from the form of the commodity into the form of money. The labour time contained in it only needs to be authentically verified (which, by the way, is not as easy as assaying the purity and weight of gold and silver) and thereby immediately creates its counter-value, its monetary existence. No matter how we may turn and twist the matter, in the last instance it amounts to this: the bank which issues the time-chits buys commodities at their costs of production, buys all commodities, and moreover this purchase costs the bank nothing more than the production of snippets of paper, and the bank gives the seller, in place of the exchange value which he possesses in a definite and substantial form, the symbolic exchange value of the commodity, in other words a draft on all other commodities to the amount of the same exchange value. Exchange value as such can of course exist only symbolically, although in order for it to be employed as a thing and not merely as a formal notion, this symbol must possess an objective existence; it is not merely an ideal notion, but is actually presented to the mind in an objective mode. (A measure can be held in the hand; exchange value measures, but it exchanges only when the measure passes from one hand to the other.) So the bank gives money for the commodity; money which is an exact draft on the exchange value of the commodity, i.e. of all commodities of the same value; the bank buys. The bank is the general buyer, the buyer of not only this or that commodity, but all commodities. For its purpose is to bring about the transposition of every commodity into its symbolic existence as exchange value. But if it is the general buyer, then it also has to be the general seller; not only the dock where all wares are deposited, not only the general warehouse, but also the owner of the commodities, in the same sense as every merchant. I have exchanged my commodity A for the time-chit B, which represents the commodity’s exchange value; but I have done this only so that I can then further metamorphose this B into any real commodity C, D, E etc., as it suits me. Now, can this money circulate outside the bank? Can it take any other route than that between the owner of the chit and the bank? How is the convertibility of this chit secured? Only two cases are possible. Either all owners of commodities (be these products or labour) desire to sell their commodities at their exchange value, or some want to and some do not. If they all want to sell at their exchange value, then they will not await the chance arrival or non-arrival of a buyer, but go immediately to the bank, unload their commodities on to it, and obtain their exchange value symbol, money, for them: they redeem them for its money. In this case the bank is simultaneously the general buyer and the general seller in one person. Or the opposite takes place. In this case, the bank chit is mere paper which claims to be the generally recognized symbol of exchange value, but has in fact no value. For this symbol has to have the property of not merely representing, but being, exchange value in actual exchange. In the latter case the bank chit would not be money, or it would be money only by convention between the bank and its clients, but not on the open market. It would be the same as a meal ticket good for a dozen meals which I obtain from a restaurant, or a theatre pass good for a dozen evenings, both of which represent money, but only in this particular restaurant or this particular theatre. The bank chit would have ceased to meet the qualifications of money, since it would not circulate among the general public, but only between the bank and its clients. We thus have to drop the latter supposition.
The bank would thus be the general buyer and seller. Instead of notes it could also issue cheques, and instead of that it could also keep simple bank accounts. Depending on the sum of commodity values which X had deposited with the bank, X would have that sum in the form of other commodities to his credit. A second attribute of the bank would be necessary: it would need the power to establish the exchange value of all commodities, i.e. the labour time materialized in them, in an authentic manner. But its functions could not end there. It would have to determine the labour time in which commodities could be produced, with the average means of production available in a given industry, i.e. the time in which they would have to be produced. But that also would not be sufficient. It would not only have to determine the time in which a certain quantity of products had to be produced, and place the producers in conditions which made their labour equally productive (i.e. it would have to balance and to arrange the distribution of the means of labour), but it would also have to determine the amounts of labour time to be employed in the different branches of production. The latter would be necessary because, in order to realize exchange value and make the bank’s currency really convertible, social production in general would have to be stabilized and arranged so that the needs of the partners in exchange were always satisfied. Nor is this all. The biggest exchange process is not that between commodities, but that between commodities and labour. (More on this presently.) The workers would not be selling their labour to the bank, but they would receive the exchange value for the entire product of their labour, etc. Precisely seen, then, the bank would be not only the general buyer and seller, but also the general producer. In fact either it would be a despotic ruler of production and trustee of distribution, or it would indeed be nothing more than a board which keeps the books and accounts for a society producing in common. The common ownership of the means of production is presupposed, etc., etc. The Saint-Simonians made their bank into the papacy of production.
The dissolution of all products and activities into exchange values presupposes the dissolution of all fixed personal (historic) relations of dependence in production, as well as the all-sided dependence of the producers on one another. Each individual’s production is dependent on the production of all others; and the transformation of his product into the necessaries of his own life is [similarly] dependent on the consumption of all others. Prices are old; exchange also; but the increasing determination of the former by costs of production, as well as the increasing dominance of the latter over all relations of production, only develop fully, and continue to develop ever more completely, in bourgeois society, the society of free competition. What Adam Smith, in the true eighteenth-century manner, puts in the prehistoric period, the period preceding history, is rather a product of history.
This reciprocal dependence is expressed in the constant necessity for exchange, and in exchange value as the all-sided mediation. The economists express this as follows: Each pursues his private interest and only his private interest; and thereby serves the private interests of all, the general interest, without willing or knowing it. The real point is not that each individual’s pursuit of his private interest promotes the totality of private interests, the general interest. One could just as well deduce from this abstract phrase that each individual reciprocally blocks the assertion of the others’ interests, so that, instead of a general affirmation, this war of all against all produces a general negation. The point is rather that private interest is itself already a socially determined interest, which can be achieved only within the conditions laid down by society and with the means provided by society; hence it is bound to the reproduction of these conditions and means. It is the interest of private persons; but its content, as well as the form and means of its realization, is given by social conditions independent of all.
The reciprocal and all-sided dependence of individuals who are indifferent to one another forms their social connection. This social bond is expressed in exchange value, by means of which alone each individual’s own activity or his product becomes an activity and a product for him; he must produce a general product – exchange value, or, the latter isolated for itself and individualized, money. On the other side, the power which each individual exercises over the activity of others or over social wealth exists in him as the owner of exchange values, of money. The individual carries his social power, as well as his bond with society, in his pocket. Activity, regardless of its individual manifestation, and the product of activity, regardless of its particular make-up, are always exchange value, and exchange value is a generality, in which all individuality and peculiarity are negated and extinguished. This indeed is a condition very different from that in which the individual or the individual member of a family or clan (later, community) directly and naturally reproduces himself, or in which his productive activity and his share in production are bound to a specific form of labour and of product, which determine his relation to others in just that specific way.
The social character of activity, as well as the social form of the product, and the share of individuals in production here appear as something alien and objective, confronting the individuals, not as their relation to one another, but as their subordination to relations which subsist independently of them and which arise out of collisions between mutually indifferent individuals. The general exchange of activities and products, which has become a vital condition for each individual – their mutual interconnection – here appears as something alien to them, autonomous, as a thing. In exchange value, the social connection between persons is transformed into a social relation between things; personal capacity into objective wealth. The less social power the medium of exchange possesses (and at this stage it is still closely bound to the nature of the direct product of labour and the direct needs of the partners in exchange) the greater must be the power of the community which binds the individuals together, the patriarchal relation, the community of antiquity, feudalism and the guild system. (See my Notebook XII, 34 B.)  Each individual possesses social power in the form of a thing. Rob the thing of this social power and you must give it to persons to exercise over persons. Relations of personal dependence (entirely spontaneous at the outset) are the first social forms, in which human productive capacity develops only to a slight extent and at isolated points. Personal independence founded on objective [sachlicher] dependence is the second great form, in which a system of general social metabolism, of universal relations, of all-round needs and universal capacities is formed for the first time. Free individuality, based on the universal development of individuals and on their subordination of their communal, social productivity as their social wealth, is the third stage. The second stage creates the conditions for the third. Patriarchal as well as ancient conditions (feudal, also) thus disintegrate with the development of commerce, of luxury, of money, of exchange value, while modern society arises and grows in the same measure.
Exchange and division of labour reciprocally condition one another. Since everyone works for himself but his product is nothing for him, each must of course exchange, not only in order to take part in the general productive capacity but also in order to transform his own product into his own subsistence. (See my ‘Remarks on Economics’, p. V (13,20).)  Exchange, when mediated by exchange value and money, presupposes the all-round dependence of the producers on one another, together with the total isolation of their private interests from one another, as well as a division of social labour whose unity and mutual complementarity exist in the form of a natural relation, as it were, external to the individuals and independent of them. The pressure of general demand and supply on one another mediates the connection of mutually indifferent persons.
The very necessity of first transforming individual products or activities into exchange value, into money, so that they obtain and demonstrate their social power in this objective [sachlichen] form, proves two things: (1) That individuals now produce only for society and in society; (2) that production is not directly social, is not ‘the offspring of association’, which distributes labour internally. Individuals are subsumed under social production; social production exists outside them as their fate; but social production is not subsumed under individuals, manageable by them as their common wealth. There can therefore be nothing more erroneous and absurd than to postulate the control by the united individuals of their total production, on the basis of exchange value, of money, as was done above in the case of the time-chit bank. The private exchange of all products of labour, all activities and all wealth stands in antithesis not only to a distribution based on a natural or political super- and subordination of individuals to one another (to which exchange proper only runs parallel or, by and large, does not so much take a grip on the life of entire communities as, rather, insert itself between different communities; it by no means exercises general domination over all relations of production and distribution) (regardless of the character of this super- and subordination: patriarchal, ancient or feudal) but also to free exchange among individuals who are associated on the basis of common appropriation and control of the means of production. (The latter form of association is not arbitrary; it presupposes the development of material and cultural conditions which are not to be examined any further at this point.) Just as the division of labour creates agglomeration, combination, cooperation, the antithesis of private interests, class interests, competition, concentration of capital, monopoly, stock companies – so many antithetical forms of the unity which itself brings the antithesis to the fore – so does private exchange create world trade, private independence creates complete dependence on the so-called world market, and the fragmented acts of exchange create a banking and credit system whose books, at least keep a record of the balance between debit and credit in private exchange. Although the private interests within each nation divide it into as many nations as it has ‘full-grown individuals’, and although the interests of exporters and of importers are antithetical here, etc, etc., national trade does obtain the semblance of existence in the form of the rate of exchange. Nobody will take this as a ground for believing that a reform of the money market can abolish the foundations of internal or external private trade. But within bourgeois society, the society that rests on exchange value, there arise relations of circulation as well as of production which are so many mines to explode it. (A mass of antithetical forms of the social unity, whose antithetical character can never be abolished through quiet metamorphosis. On the other hand, if we did not find concealed in society as it is the material conditions of production and the corresponding relations of exchange prerequisite for a classless society, then all attempts to explode it would be quixotic.)
We have seen that, although exchange value is = to the relative labour time materialized in products, money, for its part, is = to the exchange value of commodities, separated from their substance; and that in this exchange value or money relation are contained the contradictions between commodities and their exchange value, between commodities as exchange values and money. We saw that a bank which directly creates the mirror image of the commodity in the form of labour-money is a utopia. Thus, although money owes its existence only to the tendency of exchange value to separate itself from the substance of commodities and to take on a pure form, nevertheless commodities cannot be directly transformed into money; i.e. the authentic certificate of the amount of labour time realized in the commodity cannot serve the commodity as its price in the world of exchange values. How is this?
(In one of the forms of money – in so far as it is medium of exchange (not measure of exchange value) – it is clear to the economists that the existence of money presupposes the objectification [Versachlichung] of the social bond; in so far, that is, as money appears in the form of collateral which one individual must leave with another in order to obtain a commodity from him. Here the economists themselves say that people place in a thing (money) the faith which they do not place in each other. But why do they have faith in the thing? Obviously only because that thing is an objectified relation between persons; because it is objectified exchange value, and exchange value is nothing more than a mutual relation between people’s productive activities. Every other collateral may serve the holder directly in that function: money serves him only as the ‘dead pledge of society’,  but it serves as such only because of its social (symbolic) property; and it can have a social property only because individuals have alienated their own social relationship from themselves so that it takes the form of a thing.)
In the lists of current prices, where all values are measured in money, it seems as though this independence from persons of the social character of things is, by the activity of commerce, on this basis of alienation where the relations of production and distribution stand opposed to the individual, to all individuals, at the same time subordinated to the individual again. Since, ‘if you please’, the autonomization of the world market (in which the activity of each individual is included), increases with the development of monetary relations (exchange value) and vice versa, since the general bond and all-round interdependence in production and consumption increase together with the independence and indifference of the consumers and producers to one another; since this contradiction leads to crises, etc., hence, together with the development of this alienation, and on the same basis, efforts are made to overcome it: institutions emerge whereby each individual can acquire information about the activity of all others and attempt to adjust his own accordingly, e.g. lists of current prices, rates of exchange, interconnections between those active in commerce through the mails, telegraphs etc. (the means of communication of course grow at the same time). (This means that, although the total supply and demand are independent of the actions of each individual, everyone attempts to inform himself about them, and this knowledge then reacts back in practice on the total supply and demand. Although on the given standpoint, alienation is not overcome by these means, nevertheless relations and connections are introduced thereby which include the possibility of suspending the old standpoint.) (The possibility of general statistics, etc.) (This is to be developed, incidentally, under the categories ‘Prices, Demand and Supply’. To be further noted here only that a comprehensive view over the whole of commerce and production in so far as lists of current prices in fact provide it, furnishes indeed the best proof of the way in which their own exchange and their own production confront individuals as an objective relation which is independent of them. In the case of the world market, the connection of the individual with all, but at the same time also the independence of this connection from the individual, have developed to such a high level that the formation of the world market already at the same time contains the conditions for going beyond it.) Comparison in place of real communality and generality.
(It has been said and may be said that this is precisely the beauty and the greatness of it: this spontaneous interconnection, this material and mental metabolism which is independent of the knowing and willing of individuals, and which presupposes their reciprocal independence and indifference. And, certainly, this objective connection is preferable to the lack of any connection, or to a merely local connection resting on blood ties, or on primeval, natural or master-servant relations. Equally certain is it that individuals cannot gain mastery over their own social interconnections before they have created them. But it is an insipid notion to conceive of this merely objective bond as a spontaneous, natural attribute inherent in individuals and inseparable from their nature (in antithesis to their conscious knowing and willing). This bond is their product. It is a historic product. It belongs to a specific phase of their development. The alien and independent character in which it presently exists vis-à-vis individuals proves only that the latter are still engaged in the creation of the conditions of their social life, and that they have not yet begun, on the basis of these conditions, to live it. It is the bond natural to individuals within specific and limited relations of production. Universally developed individuals, whose social relations, as their own communal [gemeinschaftlich] relations, are hence also subordinated to their own communal control, are no product of nature, but of history. The degree and the universality of the development of wealth where this individuality becomes possible supposes production on the basis of exchange values as a prior condition, whose universality produces not only the alienation of the individual from himself and from others, but also the universality and the comprehensiveness of his relations and capacities. In earlier stages of development the single individual seems to be developed more fully, because he has not yet worked out his relationships in their fullness, or erected them as independent social powers and relations opposite himself. It is as ridiculous to yearn for a return to that original fullness  as it is to believe that with this complete emptiness history has come to a standstill. The bourgeois viewpoint has never advanced beyond this antithesis between itself and this romantic viewpoint, and therefore the latter will accompany it as legitimate antithesis up to its blessed end.)
(The relation of the individual to science may be taken as an example here.)
(To compare money with blood – the term circulation gave occasion for this – is about as correct as Menenius Agrippa’s comparison between the patricians and the stomach.)  (To compare money with language is not less erroneous. Language does not transform ideas, so that the peculiarity of ideas is dissolved and their social character runs alongside them as a separate entity, like prices alongside commodities. Ideas do not exist separately from language. Ideas which have first to be translated out of their mother tongue into a foreign language in order to circulate, in order to become exchangeable, offer a somewhat better analogy; but the analogy then lies not in language, but in the foreignness of language.)
(The exchangeability of all products, activities and relations with a third, objective entity which can be re-exchanged for everything without distinction – that is, the development of exchange values (and of money relations) is identical with universal venality, corruption. Universal prostitution appears as a necessary phase in the development of the social character of personal talents, capacities, abilities, activities. More politely expressed: the universal relation of utility and use. The equation of the incompatible, as Shakespeare nicely defined money.  Greed as such impossible without money; all other kinds of accumulation and of mania for accumulation appear as primitive, restricted by needs on the one hand and by the restricted nature of products on the other (sacra auri fames ).)
(The development of the money system obviously presupposes other, prior developments.)
When we look at social relations which create an undeveloped system of exchange, of exchange values and of money, or which correspond to an undeveloped degree of these, then it is clear from the outset that the individuals in such a society, although their relations appear to be more personal, enter into connection with one another only as individuals imprisoned within a certain definition, as feudal lord and vassal, landlord and serf, etc., or as members of a caste etc. or as members of an estate etc. In the money relation, in the developed system of exchange (and this semblance seduces the democrats), the ties of personal dependence, of distinctions of blood, education, etc, are in fact exploded, ripped up (at least, personal ties all appear as personal relations); and individuals seem independent (this is an independence which is at bottom merely an illusion and it is more correctly called indifference), free to collide with one another and to engage in exchange within this freedom; but they appear thus only for someone who abstracts from the conditions, the conditions of existence within which these individuals enter into contact (and these conditions, in turn, are independent of the individuals and, although created by society, appear as if they were natural conditions, not controllable by individuals). The definedness of individuals, which in the former case appears as a personal restriction of the individual by another, appears in the latter case as developed into an objective restriction of the individual by relations independent of him and sufficient unto themselves. (Since the single individual cannot strip away his personal definition, but may very well overcome and master external relations, his freedom seems to be greater in case 2. A closer examination of these external relations, these conditions, shows, however, that it is impossible for the individuals of a class etc. to overcome them en masse without destroying them. A particular individual may by chance get on top of these relations, but the mass of those under their rule cannot, since their mere existence expresses subordination, the necessary subordination of the mass of individuals.) These external relations are very far from being an abolition of ‘relations of dependence’; they are rather the dissolution of these relations into a general form; they are merely the elaboration and emergence of the general foundation of the relations of personal dependence. Here also individuals come into connection with one another only in determined ways. These objective dependency relations also appear, in antithesis to those of personal dependence (the objective dependency relation is nothing more than social relations which have become independent and now enter into opposition to the seemingly independent individuals; i.e. the reciprocal relations of production separated from and autonomous of individuals) in such a way that individuals are now ruled by abstractions, whereas earlier they depended on one another. The abstraction, or idea, however, is nothing more than the theoretical expression of those material relations which are their lord and master. Relations can be expressed, of course, only in ideas, and thus philosophers have determined the reign of ideas to be the peculiarity of the new age, and have identified the creation of free individuality with the overthrow of this reign. This error was all the more easily committed, from the ideological stand-point, as this reign exercised by the relations (this objective dependency, which, incidentally, turns into certain definite relations of personal dependency, but stripped of all illusions) appears within the consciousness of individuals as the reign of ideas, and because the belief in the permanence of these ideas, i.e. of these objective relations of dependency, is of course consolidated, nourished and inculcated by the ruling classes by all means available.
(As regards the illusion of the ‘purely personal relations’ in feudal times, etc., it is of course not to be forgotten for a moment (1) that these relations, in a certain phase, also took on an objective character within their own sphere, as for example the development of landed proprietorship out of purely military relations of subordination; but (2) the objective relation on which they founder has still a limited, primitive character and therefore seems personal, while, in the modern world, personal relations flow purely out of relations of production and exchange.)
The product becomes a commodity. The commodity becomes exchange value. The exchange value of the commodity acquires an existence of its own alongside the commodity; i.e. the commodity in the form in which (1) it is exchangeable with all other commodities, (2) it has hence become a commodity in general, and its natural specificity is extinguished, and (3) the measure of its exchangeability (i.e. the given relation within which it is equivalent to other commodities) has been determined – this commodity is the commodity as money, and, to be precise, not as money in general, but as a certain definite sum of money, for, in order to represent exchange value in all its variety, money has to be countable, quantitatively divisible.
Money – the common form into which all commodities as exchange values are transformed, i.e. the universal commodity – must itself exist as a particular commodity alongside the others, since what is required is not only that they can be measured against it in the head, but that they can be changed and exchanged for it in the actual exchange process. The contradiction which thereby enters, to be developed elsewhere. Money does not arise by convention, any more than the state does. It arises out of exchange, and arises naturally out of exchange; it is a product of the same. At the beginning, that commodity will serve as money – i.e. it will be exchanged not for the purpose of satisfying a need, not for consumption, but in order to be re-exchanged for other commodities – which is most frequently exchanged and circulated as an object of consumption, and which is therefore most certain to be exchangeable again for other commodities, i.e. which represents within the given social organization wealth ϰατ᾽ ἐξοχήν,  which is the object of the most general demand and supply, and which possesses a particular use value. Thus salt, hides, cattle, slaves. In practice such a commodity corresponds more closely to itself as exchange value than do other commodities (a pity that the difference between denrée and marchandise cannot be neatly reproduced in German). It is the particular usefulness of the commodity whether as a particular object of consumption (hides), or as a direct instrument of production (slaves), which stamps it as money in these cases. In the course of further development precisely the opposite will occur, i.e. that commodity which has the least utility as an object of consumption or instrument of production will best serve the needs of exchange as such. In the former case, the commodity becomes money because of its particular use value; in the latter case it acquires its particular use value from its serviceability as money. The precious metals last, they do not alter, they can be divided and then combined together again, they can be transported relatively easily owing to the compression of great exchange value in little space – for all these reasons they are especially suitable in the latter stage. At the same time, they form the natural transition from the first form of money. At somewhat higher levels of production and exchange, the instrument of production takes precedence over products; and the metals (prior to that, stones) are the first and most indispensable instruments of production. Both are still combined in the case of copper, which played so large a role as money in antiquity; here is the particular use value as an instrument of production together with other attributes which do not flow out of the use value of the commodity but correspond to its function as exchange value (including medium of exchange). The precious metals then split off from the remainder by virtue of being inoxidizable, of standard quality etc., and they correspond better, then, to the higher stage, in that their direct utility for consumption and production recedes while, because of their rarity, they better represent value purely based on exchange. From the outset they represent superfluity, the form in which wealth originates. Also, metals preferably exchanged for metals rather than for other commodities.
The first form of money corresponds to a low stage of exchange and of barter, in which money still appears more in its quality of measure rather than as a real instrument of exchange. At this stage, the measure can still be purely imaginary (although the bar in use among Negroes includes iron) (sea shells etc., however, correspond more to the series of which gold and silver form the culmination).
From the fact that the commodity develops into general exchange value, it follows that exchange value becomes a specific commodity: it can do so only because a specific commodity obtains the privilege of representing, symbolizing, the exchange value of all other commodities, i.e. of becoming money. It arises from the essence of exchange value itself that a specific commodity appears as the money-subject, despite the monetary properties possessed by every commodity. In the course of development, the exchange value of money can again exist separately from its matter, its substance, as in the case of paper money, without therefore giving up the privilege of this specific commodity, because the separated form of existence of exchange value must necessarily continue to take its denomination from the specific commodity.
It is because the commodity is exchange value that it is exchangeable for money, is posited = to money. The proportion of its equivalence with money, i.e. the specificity of its exchange value, is presupposed before its transposition into money. The proportion in which a particular commodity is exchanged for money, i.e. the quantity of money into which a given quantity of a commodity is transposable, is determined by the amount of labour time objectified in the commodity. The commodity is an exchange value because it is the realization of a specific amount of labour time; money not only measures the amount of labour time which the commodity represents, but also contains its general, conceptually adequate, exchangeable form. Money is the physical medium into which exchange values are dipped, and in which they obtain the form corresponding to their general character. Adam Smith says that labour (labour time) is the original money with which all commodities are purchased.  As regards the act of production, this always remains true (as well as in the determination of relative values). In production, every commodity is continuously exchanged for labour time. The necessity of a money other than labour time arises precisely because the quantity of labour time must not be expressed in its immediate, particular product, but in a mediated, general product; in its particular product, as a product equal to and convertible into all other products of an equal labour time; of the labour time not in a particular commodity, but in all commodities at once, and hence in a particular commodity which represents all the others. Labour time cannot directly be money (a demand which is the same, in other words, as demanding that every commodity should simply be its own money), precisely because in fact labour time always exists only in the form of particular commodities (as an object): being a general object, it can exist only symbolically, and hence only as a particular commodity which plays the role of money. Labour time does not exist in the form of a general object of exchange which is independent of and separate (in isolation) from the particular natural characteristics of commodities. But it would have to exist in that form if it were directly to fulfil the demands placed on money. The objectification of the general, social character of labour (and hence of the labour time contained in exchange value) is precisely what makes the product of labour time into exchange value; this is what gives the commodity the attributes of money, which however, in turn imply the existence of an independent and external money-subject.
A particular expenditure of labour time becomes objectified in a definite particular commodity with particular properties and a particular relationship to needs; but, in the form of exchange value, labour time is required to become objectified in a commodity which expresses no more than its quota or quantity, which is indifferent to its own natural properties, and which can therefore be metamorphosed into – i.e. exchanged for – every other commodity which objectifies the same labour time. The object should have this character of generality, which contradicts its natural particularity. This contradiction can be overcome only by objectifying it: i.e. by positing the commodity in a double form, first in its natural, immediate form, then in its mediated form, as money. The latter is possible only because a particular commodity becomes, as it were, the general substance of exchange values, or because the exchange values of commodities become identified with a particular commodity different from all others. That is, because the commodity first has to be exchanged for this general commodity, this symbolic general product or general objectification of labour time, before it can function as exchange value and be exchanged for, metamorphosed into, any other commodities at will and regardless of their material properties. Money is labour time in the form of a general object, or the objectification of general labour time, labour time as a general commodity. Thus, it may seem a very simple matter that labour time should be able to serve directly as money (i.e. be able to furnish the element in which exchange values are realized as such), because it regulates exchange values and indeed is not only the inherent measure of exchange values but their substance as well (for, as exchange values, commodities have no other substance, no natural attributes). However, this appearance of simplicity is deceptive. The truth is that the exchange-value relation – of commodities as mutually equal and equivalent objectifications of labour time – comprises contradictions which find their objective expression in a money which is distinct from labour time.
In Adam Smith this contradiction still appears as a set of parallels. Along with the particular product of labour (labour time as a particular object), the worker also has to produce a quantity of the general commodity (of labour time as general object). The two determinants of exchange value appear to Smith as existing externally, alongside one another. The interior of the commodity as a whole does not yet appear as having been seized and penetrated by contradiction. This corresponds to the stage of production which Smith found in existence at that time, in which the worker still directly owned a portion of his subsistence in the form of the product; where neither his entire activity nor his entire product had become dependent on exchange; i.e. where subsistence agriculture (or something similar, as Steuart calls it)  still predominated to a great extent, together with patriarchal industry (hand weaving, domestic spinning, linked closely with agriculture). Still it was only the excess which was exchanged within a large area of the nation. Exchange value and determination by labour time not yet fully developed on a national scale.
(Incidental remark: It is less true of gold and silver than of any other commodities that their consumption can grow only in inverse proportion to their costs of production. Their consumption grows, rather, in proportion with the growth of general wealth, since their use specifically represents wealth, excess, luxury, because they themselves represent wealth in general. Apart from their use as money, silver and gold are consumed more in proportion as wealth in general increases. When, therefore, their supply suddenly increases, even if their costs of production or their value does not proportionately decrease, they find a rapidly expanding market which retards their depreciation. A number of problems which appear inexplicable to the economists – who generally make consumption of gold and silver dependent solely on the decrease in their costs of production – in regard to the California-Australia case,  where they go around in circles, are thereby clarified. This is precisely linked with their property as money, as representation of wealth.)
(The contrast between gold and silver, as eternal commodities, and the others, which are not, is to be found in Petty,  but is already present in Xenophon, On Revenues, in reference to marble and silver. ‘οὐ μόνον δὲ ϰρατεῖ τοῖς ἐπ᾽ ἐνιαυτὸν ϑάλλουσί τε ϰαὶ γηράσϰουσιν, ἀλλὰ ϰαὶ ἀίδια ἀγαϑὰ ἔχει ἡ χώρα. πέφυϰε μὲν γὰρ λίϑος ἐν αὐτῆ ᾄφθονος, etc. (namely marble) ἔστι δὲ ϰαὶ γῆ, ἣ σπειρομὲνη μὲν οὐ φέρει ϰαρπόν, ὀρυττομένη δὲ πολλαπλασίους τρέφει ἢ ἐι σῖτον ἒφεφε.’)  (Important to note that exchange between different tribes or peoples – and this, not private exchange, is its first form – begins when an uncivilized tribe sells (or is cheated out of) an excess product which is not the product of its labour, but the natural product of the ground and of the area which it occupies.)
(Develop the ordinary economic contradictions arising from the fact that money has to be symbolized in a particular commodity, and then develop those that arise from this commodity itself (gold, etc.) This No. II.  Then determine the relation between the quantity of gold and silver and commodity prices, and whether the exchange takes place in reality or only in the mind, since all commodities have to be exchanged for money in order to be determined as prices. This No. III.  It is clear that, merely measured in gold or silver, the quantity of these metals has no influence on the prices of commodities; the difficulty enters with actual exchange, where the metals actually serve as instruments of exchange; the relations of demand and supply etc. But it is obviously as a measure that its value as an instrument of circulation is affected.)
Labour time itself exists as such only subjectively, only in the form of activity. In so far as it is exchangeable (itself a commodity) as such, it is defined and differentiated not only quantitatively but also qualitatively, and is by no means general, self-equivalent labour time; rather, labour time as subject corresponds as little to the general labour time which determines exchange values as the particular commodities and products correspond to it as object.
A. Smith’s thesis, that the worker has to produce a general commodity alongside his particular commodity, in other words that he has to give a part of his products the form of money, more generally that he has to convert into money all that part of his commodity which is to serve not as use value for himself but as exchange value – this statement means, subjectively expressed, nothing more than that the worker’s particular labour time cannot be directly exchanged for every other particular labour time, but rather that this, its general exchangeability, has first to be mediated, that it has first to take on an objective form, a form different from itself, in order to attain this general exchangeability.
The labour of the individual looked at in the act of production itself, is the money with which he directly buys the product, the object of his particular activity; but it is a particular money, which buys precisely only this specific product. In order to be general money directly, it would have to be not a particular, but general labour from the outset; i.e. it would have to be posited from the outset as a link in general production. But on this presupposition it would not be exchange which gave labour its general character; but rather its presupposed communal character would determine the distribution of products. The communal character of production would make the product into a communal, general product from the outset. The exchange which originally takes place in production – which would not be an exchange of exchange values but of activities, determined by communal needs and communal purposes – would from the outset include the participation of the individual in the communal world of products. On the basis of exchange values, labour is posited as general only through exchange. But on this foundation it would be posited as such before exchange; i.e. the exchange of products would in no way be the medium by which the participation of the individual in general production is mediated. Mediation must, of course, take place. In the first case, which proceeds from the independent production of individuals – no matter how much these independent productions determine and modify each other post festum through their interrelations – mediation takes place through the exchange of commodities, through exchange value and through money; all these are expressions of one and the same relation. In the second case, the presupposition is itself mediated; i.e. a communal production, communality, is presupposed as the basis of production. The labour of the individual is posited from the outset as social labour. Thus, whatever the particular material form of the product he creates or helps to create, what he has bought with his labour is not a specific and particular product, but rather a specific share of the communal production. He therefore has no particular product to exchange. His product is not an exchange value. The product does not first have to be transposed into a particular form in order to attain a general character for the individual. Instead of a division of labour, such as is necessarily created with the exchange of exchange values, there would take place an organization of labour whose consequence would be the participation of the individual in communal consumption. In the first case the social character of production is posited only post festum with the elevation of products to exchange values and the exchange of these exchange values. In the second case the social character of production is presupposed, and participation in the world of products, in consumption, is not mediated by the exchange of mutually independent labours or products of labour. It is mediated, rather, by the social conditions of production within which the individual is active. Those who want to make the labour of the individual directly into money (i.e. his product as well), into realized exchange value, want therefore to determine that labour directly as general labour, i.e. to negate precisely the conditions under which it must be made into money and exchange values, and under which it depends on private exchange. This demand can be satisfied only under conditions where it can no longer be raised. Labour on the basis of exchange values presupposes, precisely, that neither the labour of the individual nor his product are directly general; that the product attains this form only by passing through an objective mediation by means of a form of money distinct from itself.
On the basis of communal production, the determination of time remains, of course, essential. The less time the society requires to produce wheat, cattle etc., the more time it wins for other production, material or mental. Just as in the case of an individual, the multiplicity of its development, its enjoyment and its activity depends on economization of time. Economy of time, to this all economy ultimately reduces itself. Society likewise has to distribute its time in a purposeful way, in order to achieve a production adequate to its overall needs; just as the individual has to distribute his time correctly in order to achieve knowledge in proper proportions or in order to satisfy the various demands on his activity. Thus, economy of time, along with the planned distribution of labour time among the various branches of production, remains the first economic law on the basis of communal production. It becomes law, there, to an even higher degree. However, this is essentially different from a measurement of exchange values (labour or products) by labour time. The labour of individuals in the same branch of work, and the various kinds of work, are different from one another not only quantitatively but also qualitatively. What does a solely quantitative difference between things presuppose? The identity of their qualities. Hence, the quantitative measure of labours presupposes the equivalence, the identity of their quality.
(Strabo, Book XI. On the Albanians of the Caucasus: ‘ϰαὶ οἱ ἄνθρωνοι ϰάλλει ϰαὶ μεγέθει διαφέροντες, άπλοῖ δὲ ϰαὶ οὐ ϰαπηλιϰοί · οὐδἐ γὰρ νομίσματι τὰ πολλὰ ϰρῶνται, οὐδὲ ἀριθμὸν ἴσασι μείζω τῶν ἑϰατόν, ἀλλὰ φορτίοις τὰς ἀμοιβὰς ποιοῦνται.’ It says there further: ‘ἄπειροι δ ̓εἰσὶ ϰαὶ μέτρων τῶν ἐπ ̓ ἀϰριβὲς ϰαὶ σταθμῶν.’) 
Money appears as measure (in Homer, e.g. oxen) earlier than as medium of exchange, because in barter each commodity is still its own medium of exchange. But it cannot be its own measure or its own standard of comparison.
(2)  This much proceeds from what has been developed so far: A particular product (commodity) (material) must become the subject of money, which exists as the attribute of every exchange value. The subject in which this symbol is represented is not a matter of indifference, since the demands placed on the representing subject are contained in the conditions – conceptual determinations, characteristic relations – of that which is to be represented. The study of the precious metals as subjects of the money relations, as incarnations of the latter, is therefore by no means a matter lying outside the realm of political economy, as Proudhon believes, any more than the physical composition of paint, and of marble, lie outside the realm of painting and sculpture. The attributes possessed by the commodity as exchange value, attributes for which its natural qualities are not adequate, express the demands made upon those commodities which ϰατ᾽ ἐξοχήν  are the material of money. These demands, at the level to which we have up to now confined ourselves, are most completely satisfied by the precious metals. Metals as such [enjoy] preference over other commodities as instruments of production, and among the metals the one which is first found in its physical fullness and purity – gold; then copper, then silver and iron. The precious metals take preference over others in realizing metal, as Hegel would say. 
The precious metals uniform in their physical qualities, so that equal quantities of them should be so far identical as to present no ground for preferring this one to the others. Not the case, for example, with equal numbers of cattle and equal quantities of grain.
The other metals oxidize when exposed to air; the precious metals (mercury, silver, gold, platinum) are unaffected by the air.
Aurum (Au). Specific gravity = 19.5; melting point: 1,200° C, ‘Glittering gold is the most magnificent of all metals, and was therefore referred to in antiquity as the sun or the king of metals. Widely distributed, never in great quantities, and is hence also more precious than the other metals. Found generally in pure metallic state, partly in larger pieces, partly in the form of smaller granules fused with other minerals. As the latter decompose, there arises gold-bearing sand, carried by many rivers, from which gold, owing to its greater specific gravity, can be washed out. Enormous malleability of gold; one grain can be drawn to make a 500-foot long wire, and can be hammered into leaves barely 1/200,000 of an inch thick. Gold resists all acids, only chlorine in a free state dissolves it (aqua regia, a mixture of nitric and hydrochloric acids). To gild.’
Argentum (Ag). Specific gravity = 10. Melting point = 1,000° C. Bright appearance; the friendliest of metals, very white and malleable; can be beautifully worked up and drawn in very thin wires. Silver found as unalloyed solid; frequently also combined with lead in silvery lead ores.
So much for chemical properties of gold and silver. (Divisibility and fusibility, uniformity of pure gold and silver etc. well known.)
Gold. It is surely noteworthy that the more precious the metals are, the more isolated is their occurrence; they are found separately from the more commonly prevalent bodies, they are higher natures far from the common herd. Thus we find gold, as a rule, in unalloyed metallic state, as a crystal in various die-shaped forms, or in the greatest variety of shapes; irregular pieces and nuggets, sand and dust, in which form it is found fused into many kinds of stone, e.g. granite: and it finds its way into the sand of rivers and the gravel of floodlands as a result of the disintegration of this stone. Since the specific gravity of gold in this state goes up to 19.4, even the tiniest pieces can be extracted by stirring gold-bearing sand in water. The heavier, metallic elements settle first and can thus, as the saying goes, be washed out. Most frequently found in the company of gold is silver, and one encounters natural combinations of both metals, containing from 0.16 to 38.7 per cent silver; which naturally entails differences in colour and weight.
Silver. With the great variety of its minerals, appears as one of the more prevalent metals, both as unalloyed metal and combined with other metals or with arsenic and sulphur. (Silver chloride, silver bromide, carbonic silver oxide, bismuth-silver ore, Sternbergite, polybasite, etc.)
The chief chemical properties are: all precious metals: do not oxidize on contact with air; of gold (and platinum): are not dissolved by acids, except in chlorine. Do not oxidize, thus remain pure, free of rust; they present themselves as that which they are. Resistance to oxygen – imperishability (so highly lauded by the gold and silver fanatics of antiquity).
Physical properties: Specific gravity, i.e. a great deal of weight in a small space, especially important for means of circulation. Gold 19.5, silver 10. Brilliance. Gleam of gold, whiteness of silver, magnificence, malleability; hence so serviceable for jewellery, ornamentation, and for the addition of splendour to other objects. The white shade of silver (which reflects all light rays in their original composition); red-yellow of gold (which absorbs all colours of a mixed beam and reflects back only the red). Difficult to melt.
Geological properties: Found (gold especially) as an unalloyed solid, separate from other bodies; isolated, individualized. Individual presentation, independent of the elemental.
About the two other precious metals: (1) Platinum lacks the colour: grey on grey (soot of metals); too rare; unknown in antiquity; discovered only after the discovery of America; also discovered in the Urals in the nineteenth century; soluble only in chlorine; always solid; specific gravity = 21; the strongest fire does not melt it; more of scientific value. (2) Mercury: found in liquid form; evaporates; vapours poisonous; can be combined with other liquids (amalgams). (Specific gravity = 13.5, boiling point = 360° C.) Thus neither platinum, nor much less mercury, are suitable as money.
One of the geological properties is common to all the precious metals: rarity. Rarity (apart from supply and demand) is an element of value only in so far as its opposite, the non-rare as such, the negation of rarity, the elemental, has no value because it does not appear as the result of production. In the original definition of value, that which is most independent of conscious, voluntary production is the most valuable, assuming the existence of demand. Common pebbles have no value, relatively speaking, because they are to be had without production (even if the latter consists only of searching). For something to become an object of exchange, to have exchange value, it must not be available to everyone without the mediation of exchange; it must not appear in such an elemental form as to be common property. To this extent, rarity is an element of exchange value and hence this property of the precious metal is of importance, even apart from its further relation to supply and demand.
When we look at the advantages of the metals as such as instruments of production, then gold has to its credit that it is at bottom the first metal to be discovered as metal. For a double reason. First, because more than the others, it presents itself in nature as the most metallic, the most distinct and distinguishable metal; second, because in its preparation nature has done the work otherwise left to artifice, and for its first discovery only rough labour is necessary, but neither science nor developed instruments of production.
‘Certain it is that gold must take its place as the earliest metal known, and in the first record of man’s progress it is indicated as a standard of man’s position’ (because in the form of excess, the first form in which wealth appears. The first form of value is use value, the everyday quality that expresses the relation of the individual to nature; the second, exchange value ALONGSIDE use value, its command over other people’s use values, its social connectedness: exchange value is itself originally a value for use on Sundays only, going beyond immediate physical necessity.)
Very early discovery of gold by man: ’Gold differs remarkably from the other metals, with a very few exceptions, in the fact that it is found in nature in its metallic state. Iron and copper, tin, lead and silver are ordinarily discovered in chemical combinations with oxygen, sulphur, arsenic, or carbon; and the few exceptional occurrences of these metals in an uncombined, or, as it was formerly called, virgin state, are to be cited rather as mineralogical curiosities than as common productions. Gold is, however, always found native or metallic … Therefore, as a metallic mass, curious by its yellow colour, it would attract the eye of the most uneducated man, whereas the other substances likely to lie in his path would offer no features of attraction to his scarcely awakened powers of observation. Again gold, from the circumstance of its having been formed in those rocks which are most exposed to atmospheric action, is found in the débris of the mountains. By the disintegrating influences of the atmosphere, of changes of temperature, of the action of water, and particularly by the effects of ice, fragments of rock are continually broken off. These are borne by floods into the valleys and rolled into pebbles by the constant action of flowing water. Amongst these, pebbles, or particles, of gold are discovered. The summer heats, by drying up the waters, rendered those beds which had formed river channels and the courses of winter torrents paths for the journeys of migratory man; and here we can imagine the early discovery of gold.’
‘Gold most frequently occurs pure, or, at all events, so nearly so that its metallic nature can be at once recognized, in rivers as well as in quartz veins.’
‘The specific gravity of quartz, and of most other heavy compact rocks is about 2 1/2, whilst the specific gravity of gold is 18 or 19. Gold, therefore, is somewhere about seven times as heavy as any rock or stone with which it is likely to be associated. A current of water accordingly having sufficient strength to bear along sand or pebbles of quartz or any other rock, might not be able to move the fragments of gold associated with them. Moving water, therefore, has done for the auriferous rocks formerly, just what the miner would do now, break it, namely, up, into fragments, sweep away the lighter particles, and leave the gold behind it. Rivers are, indeed, great natural cradles, sweeping off all the lighter and finer particles at once, the heavier ones either sticking against natural impediments, or being left whenever the current slackens its force or velocity.’ (See Gold (Lectures on). London, 1852.) (pp. 12 and 13.) 
‘In all probability, from tradition and early history, the discovery of gold in the sand and gravel of streams would appear to have been the first step in the recognition of metals, and in almost all, perhaps in all, the countries of Europe, Africa and Asia, greater or smaller quantities of gold have from very early times been washed by simple contrivances from auriferous deposits. Occasionally, the success of gold-streams has been great enough to produce a pulse of excitement which has vibrated for a while through a district, but has been hushed down again. In 760 the poor people turned out in numbers to wash gold from the river sands south of Prague, and three men were able in the day to extract a mark (1/2 lb.) of gold; and so great was the consequent rush to the “diggings” that in the next year the country was visited by famine. We read of a recurrence of similar events several times within the next few centuries, although here, as elsewhere, the general attraction to surface-spread riches has subsided into regular and systematic mining.’
‘Two classes of deposits in which gold is found, the lodes or veins, which intersect the solid rock in a direction more or less perpendicular to the horizon; and the drift beds or ‘streams’, in which the gold mingled with gravel, sand, or clay, has been deposited by the mechanical action of water, upon the surface of those rocks, which are penetrated to unknown depths by the lodes. To the former class belongs more specially the art of mining; to the latter the simple operations of digging. Gold mining, properly so called, is, like other mining, an art requiring the employment of capital, and of a skill only to be acquired by years of experience. There is no art practised by civilized men which requires for its full development the application of so many sciences and collateral arts. But although so essential to the miner, scarcely any of these are necessary to the gold-washer or streamer, who must trust chiefly to the strength of his arm, or the buoyancy of his health. The apparatus which he employs must necessarily be simple, so as to be conveyed from place to place, to be easily repaired if injured, and not to require any of those niceties of manipulation which would cause him to lose time in the acquiring of small quantities.’
Difference between the drift-deposits of gold, best exemplified at the present day in Siberia, California and Australia; and the fine sands annually brought down by rivers, some of which are also found to contain gold in workable quantities. The latter are of course found literally at the surface, the former may be met with under a cover of from 1 to 70 feet in thickness, consisting of soil, peat, sand, gravel, etc. The modes of working the two must be identical in principle. For the stream-worker nature has pulled down the highest, proudest and richest parts of the lodes, and so triturated and washed up the materials, that the streamer has the heaviest part of the work already done for him: whilst the miner, who attacks the poorer, but more lasting, deep-going lodes, must aid himself with all the resources of the nicest art.
Gold has justly been considered the noblest of metals from various physical and chemical properties. It is unchangeable in air and does not rust. (Its unchangeability consists precisely in its resistance against the oxygen in the atmosphere.) Of a bright reddish yellow colour when in a coherent state, and very dense. Highly malleable. Requires a strong heat to melt it. Specific gravity.
Thus three modes of its production: (1) In the river sand. Simple finding on the surface. Washing. (2) In river beds and floodlands. Digging. (3) Mining. Its production requires, hence, no development of the productive forces. Nature does most of the work in that regard.
(The roots of the words for gold, silver etc. (see Grimm);  here we find a number of general concepts of brilliance, soon to be transferred to the words, proximate to colour. Silver white; gold yellow; brass and gold, brass and iron exchange names. Among the Germans bronze in use before iron. Direct affinity between aes (bronze) and aurum (gold).)
Copper (brass, bronze: tin and copper) and gold in use before silver and iron.
‘Gold in use long before silver, because it is found pure or only lightly admixed with silver; obtained by simple washing. Silver is found in general in veins threaded through the hardest rocks in primitive terrain: its extraction requires complicated labour and machines. In southern America, veins of gold are not exploited, only gold in the form of dust and nuggets in alluvial terrain. In Herodotus’s time, similarly. The most ancient monuments of Greece, Asia, Northern Europe and the New World prove that the use of gold for utensils and for ornamentation is possible in a semi-barbarian condition; while the use of silver for the same purposes by itself already denotes a fairly advanced state of society. See Dureau de la Malle, Notebook. (2.) 
Copper as main instrument of war and peace (ibid. 2) (as money in Italy ibid.).
If the use of metals as the substance of money, as well as their comparative uses, their earlier or later appearance, are to be examined at all, then it is necessary to look also at the fluctuations in their relative value. (Letronne, Böckh, Jacob.)  (That part of the question which is linked to the question of the mass of circulating metals as such, and its relation to prices, is to be looked at later, as a historical appendix to the chapter on the relation between money and prices.)
The successive fluctuations between gold, silver and copper in various epochs had to depend first of all on the nature of the sites where they are found, and on their greater or lesser purity. Then, on political changes, such as the invasion of Asia and of a part of Africa by the Persians and the Macedonians; later the conquest of parts of three continents by the Romans (orbis Romanus, etc.). Dependent, therefore, on their relative purity and their location.
The value relation between the different metals can be determined without recourse to prices – by means of the simple quantitative ratio in which one exchanges for the other. We can employ this form, in general, when we are comparing only a few commodities which have the same measure; e.g. so many quarters of rye, barley, oats for so many quarters of wheat. This method employed in barter, where little of anything is exchanged and where even fewer commodities enter the traffic, and where, hence, no money is required.
Among an Arab people neighbouring on Sabaea, according to Strabo, pure gold was so abundant that 10 lb. of it were given for 1 lb. of iron, and 2 lb. were given for 1 lb. silver. A wealth of gold in the Bactrian region (Bactara, etc., in short, Turkestan) and in the part of Asia situated between the Paropamisus (Hindu-kush) and the Imaus (Mustagh Mountains), i.e. in the Desertum arenosum auro abondans  (Desert of Cobi): according to Dureau de la Malle it is probable, therefore, that from the fifteenth to the sixth century B.C. the ratio of gold to silver was 6:1 or 8:1, the same which existed in China and Japan until the beginning of the nineteenth century; Herodotus puts it at 13:1 for Persia under Darius Hystaspes. According to the code of Manou, written between 1300 and 600 B.C., gold to silver = 2 1/2:1. Silver mines must nearly always be established in primitive terrain; that is where the deposits lie, and only lesser veins are found in easier ground. Instead of in alluvial sand and gravel, silver is ordinarily embedded in the most compact and hard rocks, such as quartz, etc. This metal is more common in regions which are cold, either from latitude or from elevation, while gold generally frequents warm countries. In contrast to gold, silver is only very rarely found in a pure state (usually combined with arsenic or sulphur) (muriatic acid, nitric saltpetre). As far as the quantity of deposits is concerned (prior to the discovery of Australia and California), Humboldt in 1811 estimates the proportion of gold to silver in America at 1:46, and in Europe (including Asiatic Russia) at 1:40. The mineralogists of the Académie des Sciences estimate in our time (1842) that the ratio is 1:52; despite that, the lb. of gold is only worth 15 lb. of silver; thus their value relation = 15:1.
Copper. Specific gravity = 8.9. Beautiful dawn-red colour; fairly hard; requires very high temperatures to melt. Not infrequently encountered pure; frequently combined with oxygen or sulphur. Deposits found in primordial, ancient terrain. However, found more frequently close to the surface, at no great depth, agglomerated in masses of pure metal, sometimes of a considerable weight. Used in peace and war before iron. (Gold relates to silver as the substance of money in the same way as copper to iron as instrument of labour in historical development.) Circulates in great quantity in Italy under the Romans during the first to the fifth centuries. One can determine a priori a people’s degree of civilization if one knows no more than the metal, gold, copper, silver or iron, which it uses for weapons, tools or ornamentation. Hesiod, in his poem on agriculture: ‘χαλϰῷ δ ̓ειργάζοντο μέλας δ ̓οὐϰ ἔσϰε σίδηρος’. 
Lucretius: ‘Et prior aeris erat quam ferri cognitus usus.’  Jacob cites ancient copper mines in Nubia and Siberia (see Dureau I, 58); Herodotus says that the Massagetians had only bronze, but no iron. To judge by the collection known as the Oxford Marbles, iron unknown before 1431 B.C. In Homer, iron rare; however, very common use of bronze (an alloy of copper, zinc and tin) which Greek and Roman society used for a very long period, even for the fabrication of axes and razors. Italy fairly wealthy in native copper; thus copper money formed, if not the only currency, at least the normal currency, the monetary unit of central Italy, up to 247 B.C. The Greek colonies in southern Italy received silver directly from Greece and Asia, or via Tyre and Carthage; and used it for money starting in the fifth and sixth centuries. The Romans, it seems, possessed silver money prior to the expulsion of the Kings, but, Pliny says, ‘interdictum id vetere consulto patrum, Italiae parci ‘ (i.e. the silver mines) ‘jubentium’,  They feared the consequences of a convenient means of circulation – opulence, increase of slaves, accumulation, concentration of land ownership. Among the Etruscans, too, copper money before gold.
Garnier is wrong when he says (see Notebook III, p. 28), ‘The material destined for accumulation was naturally sought for and selected from the realm of the minerals.’  On the contrary, accumulation began after metal money was found (whether as money proper or only as preferred medium of exchange by weight). This point to be discussed especially in regard to gold. Reitemeier is right (see Notebook III, p. 34): ‘Gold, silver and copper were used by the ancients as implements for hacking and breaking, despite their relative softness, before the advent of iron and before they were used as money.”  (Improvement of implements when men learned to temper copper and thus make it hard enough to defy solid rock. A very much hardened copper was used to make the chisels and hammers used for mastering rock. Finally, iron was discovered.) Jacob says: ‘In patriarchal times’ (see Notebook IV, p. 3), ‘when the metals used for making weapons, such as (1) brass and (2) iron, were rare and enormously expensive compared with the common food and clothing then used, then, although coined money made of the precious metals was still unknown, yet gold and silver had acquired the faculty of being more easily and conveniently exchanged for the other metals than corn and cattle.’ 
‘Besides, in order to obtain the pure or nearly pure gold found in the immense alluvial lands situated between the Hindu-kush chains and the Himalaya, only a simple washing operation was required. In those times the population in these countries of Asia was abundant, and hence labour was cheap. Silver was relatively more expensive owing to the (technical) difficulties of obtaining it. The opposite tendency set in in Asia and in Greece after the death of Alexander. The gold-bearing sands became exhausted; the price of slaves and of manpower rose; and, since mechanics and geometry had made immense progress from Euclid to Archimedes, it was possible to exploit with profit the rich veins of silver mined in Asia, in Thrace and in Spain; and, silver being 52 times more abundant than gold, the value ratio between them necessarily changed, so that the livre of gold, which at the time of Xenophon, 350 B.C., was exchanged for 10 livres of silver, came to be worth 18 livres of the latter metal in the year A.D. 422.  Thus, it rose from 10:1 to 18:1.
At the end of the fifth century A.D. an extraordinary diminution in the quantity of precious metals; a halt in mining. In the Middle Ages up to the end of the fifteenth century a relatively significant portion of money in gold coins. (The diminution affected, most of all, silver, which had previously circulated most widely.) Ratio in the fifteenth century = 10:1, in the eighteenth century 14:1 on the continent, in England = 15:1. In most of Asia, silver more as a commodity in trade; especially in China, where copper money (Tehen, a composition of copper, zinc and lead) coin of the realm; in China, gold (and silver) by weight as a commodity to balance foreign trade.
Large fluctuations in Rome between the value of copper and silver (in coins). Up to Servius, metal in bullion form, aes rude, for trade. The monetary unit, the copper as = 1 pound of copper. In the time of Servius, silver to copper = 279:1; until the beginning of the Punic war = 400:1 ; during the First Punic War = 140:1; Second Punic War = 112:1.
Gold very expensive in Rome at first, whereas silver from Carthage (and Spain); gold used only in ingots until 547. Gold to silver in trade = 13.71:1, in coins = 17.4:1, under Caesar = 12:1 (at the outbreak of the civil war, after the plunder of the aerarium  by Caesar, only 8:1); under Honorius and Arcadius (397) fixed at = 14.4:1; under Honorius and Theodosius the Younger (422)= 18:1. First silver coin in Rome minted 485; first gold coin: 547. As soon as, after the Second Punic War, the as was reduced to 1 ounce, it became small change; the sesterce (silver) the monetary unit, and all large payments made in silver. (In everyday commerce copper (later iron) remained the chief metal. Under the Emperors of the Orient and Occident, the solidus (aureus), i.e. gold, was the monetary standard.)
Thus, in antiquity, taking the average:
First: Relative increase in value of silver as compared with gold. Apart from special phenomena (Arabs) where gold cheaper than silver and still cheaper than iron, in Asia from the fifteenth to the sixth centuries B.C., gold to silver = 6:1 or 8:1 (the latter ratio in China and Japan until the beginning of the nineteenth century). In the Manou Code itself = 2 1/2:1. This lower ratio arises from the same causes which promote the discovery of gold as the first metal. Gold in those days chiefly from Asia and Egypt. This period corresponds to that of copper money in Italian history. In general, copper as main instrument of peace and war corresponds to the pre-eminence of gold among the precious metals. Even in Xenophon’s time, gold to silver = 10:1.
Secondly: after the death of Alexander, relative rise in the value of gold compared to silver, with the exhaustion of the gold-bearing sand, progress in technology and civilization; and hence establishment of silver mines; now the influence of the quantitatively greater prevalence of silver over gold in the earth’s crust. But especially the Carthaginians, the exploitation of Spain, which necessarily had to revolutionize the relation of silver to gold in somewhat the same way as the discovery of American silver at the end of the fifteenth century. Ratio in Caesar’s time = 17:1; later 14: 1; finally, after A.D. 422 = 18: l. (The decline of gold under Caesar for accidental reasons.) The decline of silver relative to gold corresponds to iron being the chief instrument of production in war and peace. While in the first period, influx of gold from the East, in the second, influx of silver from the cooler West.
Thirdly in the Middle Ages: Again the ratio as in the time of Xenophon, 10:1. (In some places = 12:1?)
Fourthly, after the discovery of America: Again about the ratio as in the time of Honorius and Arcadius (397); 14 to 15:1. Although since about 1815–44 an increase in the production of gold, gold was at a premium (e.g. in France). It is probable that the discovery of California and Australia
fifthly, will reintroduce the ratio of the Roman Imperium, 18: 1, if not greater. The relative depreciation of silver due to progress in the production of precious metals, in antiquity as well as after, [proceeds] from East to West, until California and Australia reverse this. In the short run, great fluctuations; but when one looks at the main differences, these repeat themselves in a remarkable fashion.
In antiquity, copper three or four times as expensive as today. (Garnier.)
Circulation, or the turnover of money, corresponds to an opposite circulation, or turnover, of commodities. A commodity possessed by A passes into the hands of B, while B’s money passes into the hands of A, etc. The circulation of money, like that of commodities, begins at an infinity of different points, and to an infinity of different points it returns. Departures from a single centre to the different points on the periphery and the return from all points of the periphery to a single centre do not take place in the circulatory process at the stage here being examined, i.e. its direct stage; they belong, rather, in a circulatory system mediated by a banking system. This first, spontaneous and natural circulation does consist, however, of a mass of turnovers. Circulation proper, nevertheless, begins only where gold and silver cease to be commodities; between countries which export precious metals and those which import them, no circulation in this sense takes place, but mere simple exchange, since gold and silver function here not as money but as commodities. Where money plays the role of mediating the exchange of commodities (that means here their circulation) and is hence a means of exchange, it is an instrument of circulation, a vehicle of circulation; but wherever, in this process, it is itself circulated, where it changes hands along its own lines of motion, there it itself has a circulation, monetary circulation, monetary turnover. The aim is to find out to what extent this circulation is determined by particular laws. This much is clear from the outset: if money is a vehicle of circulation for the commodity, then the commodity is likewise a vehicle for the circulation of money. If money circulates commodities, then commodities circulate money. The circulation of commodities and the circulation of money thus determine one another. As regards monetary turnover, three things merit attention: (1) the form of the movement itself; the line which it describes (its concept); (2) the quantity of money circulating; (3) the rate at which it completes its motion, its velocity of circulation. This can happen only in connection with the circulation of commodities. This much is clear from the outset, that there are moments in the circulation of commodities which are entirely independent of the circulation of money, and which either directly determine the latter, or which are determined along with monetary circulation by a third factor, as in the case of, e.g., the velocity. The overall character of the mode of production will determine them both, and will determine the circulation of commodities more directly. The mass of persons engaged in exchange (population): their distribution between the town and the country; the absolute quantity of commodities, of products and agencies of production; the relative mass of commodities which enter into circulation; the development of the means of communication and transport, in the double sense of determining not only the sphere of those who are in exchange, in contact, but also the speed with which the raw material reaches the producer and the product the consumer; finally the development of industry, which concentrates different branches of production, e.g. spinning, weaving, dyeing, etc., and hence makes superfluous a series of intermediate exchanges. The circulation of commodities is the original precondition of the circulation of money. To what extent the latter then reacts back on the circulation of commodities remains to be seen.
The first task is firmly to establish the general concept of circulation or of turnover.
But first let us note that what is circulated by money is exchange value, hence prices. Hence, as regards the circulation of commodities, it is not only their mass but, equally, their prices which must be considered. A large quantity of commodities at a low exchange value (price) obviously requires less money for its circulation than a smaller quantity at double the price. Thus, actually, the concept of price has to be developed before that of circulation. Circulation is the positing of prices, it is the process in which commodities are transformed into prices: their realization as prices. Money has a dual character: it is (1) measure, or element in which the commodity is realized as exchange value, and (2) means of exchange, instrument of circulation, and in each of these aspects it acts in quite opposite directions. Money only circulates commodities which have already been ideally transformed into money, not only in the head of the individual but in the conception held by society (directly, the conception held by the participants in the process of buying and selling). This ideal transformation into money is by no means determined by the same laws as the real transformation. Their interrelation is to be examined.
(a) An essential characteristic of circulation is that it circulates exchange values (products or labour), and, in particular, exchange values in the form of prices. Thus, not every form of commodity exchange, e.g. barter, payment in kind, feudal services, etc., constitutes circulation. To get circulation, two things are required above all: Firstly: the precondition that commodities are prices; Secondly: not isolated acts of exchange, but a circle of exchange, a totality of the same, in constant flux, proceeding more or less over the entire surface of society; a system of acts of exchange. The commodity is specified as an exchange value. As an exchange value, it functions in a given proportion (relative to the labour time contained in it) as equivalent for all other values (commodities); but it does not directly correspond to this, its function. As an exchange value it differs from itself as a natural, material thing. A mediation is required to posit it as an exchange value. Money presents the exchange value of the commodity to the commodity as something different from itself. The commodity which is posited as money is, at the outset, the commodity as pure exchange value, or, the commodity as pure exchange value is money. But at the same time, money now exists outside and alongside the commodity; its exchange value, the exchange value of all commodities, has achieved an existence independent of the commodity, an existence based in an autonomous material of its own, in a particular commodity. The exchange value of the commodity expresses the totality of the quantitative relations in which all other commodities can be exchanged for it, determined by the unequal quantities of the same which can be produced in the same labour time. Money then exists as the exchange value of all commodities alongside and outside them. It is the universal material into which they must be dipped, in which they become gilded and silver-plated, in order to win their independent existence as exchange values. They must be translated into money, expressed in money. Money becomes the general denomination of exchange values, of commodities as exchange values. Exchange value expressed as money, i.e. equated with money, is price. After money has been posited as independent in relation to exchange values, then the exchange values are posited in their particularity in relation to their subject, money. But every exchange value is a particular quantity; a quantitatively specific exchange value. As such, it is = a particular quantity of money. This particularity is given, in the general law, by the amount of labour time contained in a given exchange value. Thus an exchange value which is the product of, say, one day is expressed in a quantity of gold or silver which = one day of labour time, which is the product of one day of labour. The general measure of exchange values now becomes the measure which exists between each exchange value and the money to which it is equated. (Gold and silver are determined, in the first place, by their cost of production in the country of production. ‘In the mining countries all prices ultimately depend on the costs of production of the precious metals; … the remuneration paid to the miner, … affords the scale, on which the remuneration of all other producers is calculated. The gold value and silver value of all commodities exempt from monopoly depends in a country without mines on the gold and silver which can be obtained by exporting the result of a given quantity of labour, the current rate of profit, and, in each individual case, the amount of wages, which have been paid, and the time for which they have been advanced.’ (Senior.)  In other words: on the quantity of gold and silver which is directly or indirectly obtained from the mining countries in exchange for a given quantity of labour (exportable products). Money is in the first instance that which expresses the relation of equality between all exchange values: in money, they all have the same name.)
Exchange value, posited in the character of money, is price. Exchange value is expressed in price as a specific quantity of money. Money as price shows first of all the identity of all exchange values; secondly, it shows the unit of which they all contain a given number, so that the equation with money expresses the quantitative specificity of exchange values, their quantitative relation to one another. Money is here posited, thus, as the measure of exchange values; and prices as exchange values measured in money. The fact that money is the measure of prices, and hence that exchange values are compared with one another on this standard, is an aspect of the situation which is self-evident. But what is more important for the analysis is that in price, exchange value is compared with money. After money has been posited as independent exchange value, separated from commodities, then the individual commodity, the particular exchange value, is again equated to money, i.e. it is posited as equal to a given quantity of money, expressed as money, translated into money. By being equated to money, they again become related to one another as they were, conceptually, as exchange values: they balance and equate themselves with one another in given proportions. The particular exchange value, the commodity, becomes expressed as, subsumed under, posited in the character of the independent exchange value, of money. How this happens (i.e. how the quantitative relation between the quantitatively defined exchange value and a given quantity of money is found), above. But, since money has an independent existence apart from commodities, the price of the commodity appears as an external relation of exchange values or commodities to money; the commodity is not price, in the way in which its social substance stamped it as exchange value; this quality is not immediately coextensive with it; but is mediated by the commodity’s comparison with money; the commodity is exchange value, but it has a price. Exchange value was in immediate identity with it, it was its immediate quality, from which it just as immediately split, so that on one side we found the commodity, on the other (as money) its exchange value; but now, as price, the commodity relates to money on one side as something existing outside itself, and secondly, it is ideally posited as money itself, since money has a reality different from it. The price is a property of the commodity, a quality in which it is presented as money. It is no longer an immediate but a reflected quality of it. Alongside real money, there now exists the commodity as ideally posited money.
This next characteristic, a characteristic of money as measure as well as of the commodity as price, is most easily shown by means of the distinction between real money and accounting money. As measure, money always serves as accounting money, and, as price, the commodity is always transformed only ideally into money.
‘The appraisal of the commodity by the seller, the offer made by the buyer, the calculations, obligations, rents, inventories, etc., in short, everything which leads up to and precedes the material act of payment, must be expressed in accounting money. Real money intervenes only in order to realize payments and to balance (liquidate) the accounts. If I must pay 24 livres 12 sous, then accounting money presents 24 units of one sort and 12 of another, while in reality I shall pay in the form of two material pieces: a gold coin worth 24 livres and a silver coin worth 12 sous. The total mass of real money has necessary limits in the requirements of circulation. Accounting money is an ideal measure, which has no limits other than those of the imagination. Employed to express every sort of wealth if considered from the aspect of its exchange value alone; thus, national wealth, the income of the state and of individuals; the accounting values, regardless of the form in which these values may exist, regulated in one and the same form; so that there is not a single article in the mass of consumable objects which is not several times transformed into money by the mind, while, compared to this mass, the total sum of effective money is, at the most = 1:10.’ (Garnier.)  (This last ratio is poor. 1: many millions is more correct. But this entirely unmeasurable.)
Thus, just as originally money expressed exchange value, so does the commodity as price, as ideally posited, mentally realized exchange value, now express a sum of money: money in a definite proportion. As prices, all commodities in their different forms are representatives of money, whereas earlier it was money, as the independent form of exchange value, which was the representative of all commodities. After money is posited as a commodity in reality, the commodity is posited as money in the mind.
It is clear so far, then, that in this ideal transformation of commodities into money, or in the positing of commodities as prices, the quantity of really available money is altogether a matter of indifference, for two reasons: Firstly: the ideal transformation of commodities into money is prima facie independent of and unrestricted by the mass of real money. Not a single piece of money is required in this process, just as little as a measuring rod (say, a yardstick) really needs to be employed before, for example, the ideal quantity of yards can be expressed. If, for example, the entire national wealth of England is appraised in terms of money, i.e. expressed as a price, everyone knows that there is not enough money in the world to realize this price. Money is needed here only as a category, as a mental relation. Secondly: because money functions as a unit, that is, the commodity is expressed in such a way that it contains a definite sum of equal parts of money, is measured by it, it follows that the measure between both [is] the general measure of exchange values – costs of production or labour time. Thus if 1/3 of an ounce of gold is the product of 1 working day, and the commodity x is the product of 3 working days, then the commodity x = 1 oz. or £3 17s. 4d. With the measurement of money and of the commodity, the original measure of exchange values enters again. Instead of being expressed in 3 working days, the commodity is expressed in the quantity of gold or silver which is the product of 3 working days. The quantity of really available money obviously has no bearing on this proportion.
(Error by James Mill: overlooks that their cost of production and not their quantity determines the value of the precious metals, as well as the prices of commodities measured in metallic value.) 
(‘Commodities in exchange are their own reciprocal measure … But this process would require as many reference points as there are commodities in circulation. If a commodity were exchanged only for one, and not for two commodities, then it would not serve as term of comparison … Hence the necessity of a common term of comparison … This term can be purely ideal … The determination of measure is fundamental, more important than that of wages … In the trade between Russia and China silver is used to evaluate all commodities, but nevertheless this commerce is done by means of barter.’ (Storch.)  ‘The operation of measuring with money is similar to the employment of weights in the comparison of material quantities. The same name for the two units whose function is to count the weight as well as the value of each thing. Measures of weight and measures of value the same names. An étalon of invariable weight was easily found. In the case of money, the question was again the value of a pound of silver, which = its cost of production.’ (Sismondi.)  Not only the same names. Gold and silver were originally measured by weight. Thus, the as = 1 pound of copper among the Romans.)
‘Sheep and oxen, not gold and silver, money in Homer and Hesiod, as measure of value. Barter on the Trojan battlefield.’ (Jacob.) (Similarly, slaves in the Middle Ages. ibid.) 
Money can be posited in the character of measure and in that of the general element of exchange values, without being realized in its further qualities; hence also before it has taken on the form of metal money. In simple barter. However, presupposed in that case that little exchange of any kind takes place; that commodities are not developed as exchange values and hence not as prices. (‘A common standard in the price of anything presupposes its frequent and familiar alienation. This not the case in simple states of society. In non-industrial countries many things without definite price … Sale alone can determine prices, and frequent sale alone can fix a standard. The frequent sale of articles of first necessity depends on the relation between town and country’ etc.) 
A developed determination of prices presupposes that the individual does not directly produce his means of subsistence, but that his direct product is an exchange value, and hence must first be mediated by a social process, in order to become the means of life for the individual. Between the full development of this foundation of industrial society and the patriarchal condition, many intermediate stages, endless nuances. This much appears from (a). If the cost of production of the precious metals rises, then all commodity prices fall; if the cost of production of the precious metals falls, then all commodity prices rise. This is the general law, which, as we shall see, is modified in particular cases.
(b) If exchange values are ideally transformed into money by means of prices, then, in the act of exchange, in purchase and sale, they are really transformed into money, exchanged for money, in order then to be again exchanged as money for a commodity. A particular exchange value must first be exchanged for exchange value in general before it can then be in turn exchanged for particulars. The commodity is realized as an exchange value only through this mediating movement, in which money plays the part of middleman. Money thus circulates in the opposite direction from commodities. It appears as the middleman in commodity exchange, as the medium of exchange. It is the wheel of circulation, the instrument of circulation for the turnover of commodities; but, as such, it also has a circulation of its own – monetary turnover, monetary circulation. The price of the commodity is realized only when it is exchanged for real money, or in its real exchange for money.
This is what emerges from the foregoing. Commodities are really exchanged for money, transformed into real money, after they have been ideally transformed into money beforehand – i.e. have obtained the attribute of price as prices. Prices, therefore, are the precondition of monetary circulation, regardless of how much their realization appears to be a result of the latter. The circumstances which make the prices of commodities rise above or fall below their average value because their exchange value does so are to be developed in the section on exchange value, and precede the process of the actual realization of the prices of commodities through money; they thus appear, at first, as completely independent of it. The relations of numbers to one another obviously remain the same when I change them into decimal fractions. This is only giving them another name. In order really to circulate commodities, what is required is instruments of transport, and transport cannot be performed by money. If I have bought 1,000 lb. of iron for the amount of £x, then the ownership of the iron has passed into my hand. My £x have done their duty as means of exchange and have circulated, along with the title of ownership. The seller, inversely, has realized the price of iron, iron as exchange value. But in order then to bring the iron from him to me, money itself is useless; that requires wagons, horses, roads, etc. The real circulation of commodities through time and space is not accomplished by money. Money only realizes their price and thereby transfers the title to the commodity into the hands of the buyer, to him who has proffered means of exchange. What money circulates is not commodities but their titles of ownership; and what is realized in the opposite direction in this circulation, whether by purchase or sale, is again not the commodities, but their prices. The quantity of money which is, then, required for circulation is determined initially by the level of the prices of the commodities thrown into circulation. The sum total of these prices, however, is determined firstly: by the prices of the individual commodities; secondly: by the quantity of commodities at given prices which enter into circulation. For example, in order to circulate a quarter of wheat at 60s., twice as many s. are required as would be to circulate it at 30s. And if 5,000 of these quarters at 60s. are to be circulated, then 300,000 s. are required, while in order to circulate 200 such quarters only 12,000s. are needed. Thus, the amount of money required is dependent on the level of commodity prices and on the quantity of commodities at specified prices.
Thirdly, however, the quantity of money required for circulation depends not only on the sum total of prices to be realized, but on the rapidity with which money circulates, completes the task of this realization. If 1 thaler in one hour makes 10 purchases at 1 thaler each, if it is exchanged 10 times, then it performs quite the same task that 10 thalers would do if they made only 1 purchase per hour. Velocity is the negative moment; it substitutes for quantity; by its means, a single coin is multiplied.
The circumstances which determine the mass of commodity prices to be realized, on the one hand, and the velocity of circulation of money, on the other hand, are to be examined later. This much is clear, that prices are not high or low because much or little money circulates, but that much or little money circulates because prices are high or low; and, further, that the velocity of the circulating money does not depend on its quantity, but that the quantity of the circulating medium depends on its velocity (heavy payments are not counted but weighed; through this the time necessary is shortened).
Still, as already mentioned, the circulation of money does not begin from a single centre, nor does it return to a single centre from all points of the periphery (as with the banks of issue and partly with state issues); but from an infinite number of points, and returns to an infinite number (this return itself, and the time required to achieve it, a matter of chance). The velocity of the circulating medium can therefore substitute for the quantity of the circulating medium only up to a certain point. (Manufacturers and farmers pay, for example, the worker; he pays the grocer, etc.; from there the money returns to the manufacturers and farmers.) The same quantity of money can effectuate a series of payments only successively, regardless of the speed. But a certain mass of payments must be made simultaneously. Circulation takes its point of departure at one and the same time from many points. A definite quantity of money is therefore necessary for circulation, a sum which will always be engaged in circulation, and which is determined by the sum total which starts from the simultaneous points of departure in circulation, and by the velocity with which it runs its course (returns). No matter how many ebbs and floods this quantity of the circulating medium is exposed to, an average level nevertheless comes into existence; since the permanent changes are always very gradual, take place only over longer periods, and are constantly paralysed by a mass of secondary circumstances, as we shall see.
(To (a). ‘Measure, used as attribute of money, means indicator of value’ … Ridiculous, that ‘prices must fall, because commodities are judged as being worth so many ounces of gold, and the amount of gold is diminished in this country … The efficiency of gold as an indicator of value is unaffected by its quantity being greater or smaller in any particular country. If the employment of banking expedients were to succeed in reducing the paper and metal circulation in this country by half, the relative value of money and commodities would remain the same.’ Example of Peru in the sixteenth century and transmission from France to England. Hubbard, VIII, 45.)  (‘On the African coast neither gold nor silver the measure of value; instead of them, an ideal standard, an imaginary bar.’) (Jacob, V, 15.) 
In its quality of being a measure, money is indifferent to its quantity, or, the existing quantity of money makes no difference. Its quantity is measured in its quality as medium of exchange, as instrument of circulation. Whether these two qualities of money can enter into contradiction with one another – to be looked at later.
(The concept of forced, involuntary circulation (see Steuart)  does not belong here yet.)
To have circulation, what is essential is that exchange appear as a process, a fluid whole of purchases and sales. Its first presupposition is the circulation of commodities themselves, as a natural, many-sided circulation of those commodities. The precondition of commodity circulation is that they be produced as exchange values, not as immediate use values, but as mediated through exchange value. Appropriation through and by means of divestiture [Entäusserung] and alienation [Veräusserung] is the fundamental condition. Circulation as the realization of exchange values implies: (1) that my product is a product only in so far as it is for others; hence suspended singularity, generality; (2) that it is a product for me only in so far as it has been alienated, become for others; (3) that it is for the other only in so far as he himself alienates his product; which already implies (4) that production is not an end in itself for me, but a means. Circulation is the movement in which the general alienation appears as general appropriation and general appropriation as general alienation. As much, then, as the whole of this movement appears as a social process, and as much as the individual moments of this movement arise from the conscious will and particular purposes of individuals, so much does the totality of the process appear as an objective interrelation, which arises spontaneously from nature; arising, it is true, from the mutual influence of conscious individuals on one another, but neither located in their consciousness, nor subsumed under them as a whole. Their own collisions with one another produce an alien social power standing above them, produce their mutual interaction as a process and power independent of them. Circulation, because a totality of the social process, is also the first form in which the social relation appears as something independent of the individuals, but not only as, say, in a coin or in exchange value, but extending to the whole of the social movement itself. The social relation of individuals to one another as a power over the individuals which has become autonomous, whether conceived as a natural force, as chance or in whatever other form, is a necessary result of the fact that the point of departure is not the free social individual. Circulation as the first totality among the economic categories is well suited to bring this to light.
At first sight, circulation appears as a simply infinite process.  The commodity is exchanged for money, money is exchanged for the commodity, and this is repeated endlessly. This constant renewal of the same process does indeed form an important moment of circulation. But, viewed more precisely, it reveals other phenomena as well; the phenomena of completion, or, the return of the point of departure into itself. The commodity is exchanged for money; money is exchanged for the commodity. In this way, commodity is exchanged for commodity, except that this exchange is a mediated one. The purchaser becomes a seller again and the seller becomes purchaser again. In this way, each is posited in the double and the antithetical aspect, and hence in the living unity of both aspects. It is entirely wrong, therefore, to do as the economists do, namely, as soon as the contradictions in the monetary system emerge into view, to focus only on the end results without the process which mediates them; only on the unity without the distinction, the affirmation without the negation. The commodity is exchanged in circulation for a commodity: at the same time, and equally, it is not exchanged for a commodity, in as much as it is exchanged for money. The acts of purchase and sale, in other words, appear as two mutually indifferent acts, separated in time and place. When it is said that he who sells also buys in as much as he buys money, and that he who buys also sells in as much as he sells money, then it is precisely the distinction which is overlooked, the specific distinction between commodity and money. After the economists have most splendidly shown that barter, in which both acts coincide, does not suffice for a more developed form of society and mode of production, they then suddenly look at the kind of barter which is mediated by money as if it were not so mediated, and overlook the specific character of this transaction. After they have shown us that money is necessary in addition to and distinct from commodities, they assert all at once that there is no distinction between money and commodities. They take refuge in this abstraction because in the real development of money there are contradictions which are unpleasant for the apologetics of bourgeois common sense, and must hence be covered up. In so far as purchase and sale, the two essential moments of circulation, are indifferent to one another and separated in place and time, they by no means need to coincide. Their indifference can develop into the fortification and apparent independence of the one against the other. But in so far as they are both essential moments of a single whole, there must come a moment when the independent form is violently broken and when the inner unity is established externally through a violent explosion. Thus already in the quality of money as a medium, in the splitting of exchange into two acts, there lies the germ of crises, or at least their possibility, which cannot be realized, except where the fundamental preconditions of classically developed, conceptually adequate circulation are present.
It has further been seen that, in circulation, money only realizes prices. The price appears at first as an ideal aspect of the commodity; but the sum of money exchanged for a commodity is its realized price, its real price. The price appears therefore as external to and independent of the commodity, as well as existing in it ideally. If the commodity cannot be realized in money, it ceases to be capable of circulating, and its price becomes merely imaginary; just as originally the product which has become transformed into exchange value, if it is not really exchanged, ceases to be a product. (The rise and fall of prices not the question here.) From viewpoint (a) price appeared as an aspect of the commodity; but from (b) money appears as the price outside the commodity. The commodity requires not simply demand, but demand which can pay in money. Thus, if its price cannot be realized, if it cannot be transformed into money, the commodity appears as devalued, depriced. The exchange value expressed in its price must be sacrificed as soon as this specific transformation into money is necessary. Hence the complaints by Boisguillebert,  e.g. that money is the hangman of all things, the moloch to whom everything must be sacrificed, the despot of commodities. In the period of the rising absolute monarchy with its transformation of all taxes into money taxes, money indeed appears as the moloch to whom real wealth is sacrificed. Thus it appears also in every monetary panic. From having been a servant of commerce, says Boisguillebert, money became its despot.  But, in fact, already the determination of prices in themselves contains what is counterposed to money in exchange; that money no longer represents the commodity, but the commodity, money. Lamentations about commerce in money as illegitimate commerce are to be found among several writers, who form the transition from the feudal to the modern period; the same later among socialists.
(α) The further the division of labour develops, the more does the product cease to be a medium of exchange. The necessity of a general medium of exchange arises, a medium independent of the specific production of each and every one. When production is oriented towards immediate subsistence, not every article can be exchanged for every other one, and a specific activity can be exchanged only for specific products. The more specialized, manifold and interdependent the products become, the greater the necessity for a general medium of exchange. At the beginning, the product of labour, or labour itself, is the general medium of exchange. But this ceases more and more to be general medium of exchange as it becomes more specialized. A fairly developed division of labour presupposes that the needs of each person have become very many-sided and his product has become very one-sided. The need for exchange and the unmediated medium of exchange develop in inverse proportion. Hence the necessity for a general medium of exchange, where the specific product and the specific labour must be exchanged for exchangeability. The exchange value of a thing is nothing other than the quantitatively specific expression of its capacity for serving as medium of exchange. In money the medium of exchange becomes a thing, or, the exchange value of the thing achieves an independent existence apart from the thing. Since the commodity is a medium of exchange of limited potency compared with money, it can cease to be a medium of exchange as against money.
(β) The splitting of exchange into purchase and sale makes it possible for me to buy without selling (stockpiling of commodities) or to sell without buying (accumulation of money). It makes speculation possible. It turns exchange into a special business; i.e. it founds the merchant estate.  This separation of the two elements has made possible a mass of transactions in between the definitive exchange of commodities, and it enables a mass of persons to exploit this divorce. It has made possible a mass of pseudo-transactions. Sometimes it becomes evident that what appeared to be an essentially divided act is in reality an essentially unified one; then again, sometimes, that what was thought to be an essentially unified act is in reality essentially divided. At moments when purchasing and selling assert themselves as essentially different acts, a general depreciation of all commodities takes place. At moments where it turns out that money is only a medium of exchange, a depreciation of money comes about. General fall or rise of prices.
Money provides the possibility of an absolute division of labour, because of independence of labour from its specific product, from the immediate use value of its product for it. The general rise of prices in times of speculation cannot be ascribed to a general rise in its exchange value or its cost of production; for if the exchange value or the cost of production of gold were to rise in step with that of all other commodities, then their exchange values expressed in money, i.e. their prices, would remain the same. Nor can it be ascribed to a decline in the production price of gold. (Credit is not yet on the agenda here.) But since money is not only a general commodity, but also a particular, and since, as a particular, it comes under the laws of supply and demand, it follows that the general demand for particular commodities as against money must bring it down.
We see that it is in the nature of money to solve the contradictions of direct barter as well as of exchange value only by positing them as general contradictions. Whether or not a particular medium of exchange was exchanged for another particular was a matter of coincidence; now, however, the commodity must be exchanged for the general medium of exchange, against which its particularity stands in a still greater contradiction. In order to secure the exchangeability of the commodity, exchangeability itself is set up in opposition to it as an independent commodity. (It was a means, becomes an end.) The question was, whether a particular commodity encounters another particular one. But money suspends the act of exchange itself in two mutually indifferent acts.
(Before the questions regarding circulation, its strength, weakness, etc., and notably the disputed point regarding the quantity of money in circulation and prices, are further developed, money should be looked at from the point of view of its third characteristic. )
One moment of circulation is that the commodity exchanges itself through money for another commodity. But there is, equally, the other moment, not only that commodity exchanges for money and money for commodity, but equally that money exchanges for commodity and commodity for money; hence that money is mediated with itself by the commodity, and appears as the unity which joins itself with itself in its circular course. Then it appears no longer as the medium, but as the aim of circulation (as e.g. with the merchant estate) (in commerce generally). If circulation is looked at not as a constant alternation, but as a series of circular motions which it describes within itself, then this circular path appears as a double one: Commodity–Money–Money–Commodity; and in the other direction Money–Commodity–Commodity–Money; i.e. if I sell in order to buy, then I can also buy in order to sell. In the former case money only a means to obtain the commodity, and the commodity the aim; in the second case the commodity only a means to obtain money, and money the aim. This is the simple result when the moments of circulation are brought together. Looking at it as mere circulation, the point at which I intervene in order to declare it the point of departure has to be a matter of indifference.
Now, a specific distinction does enter between a commodity in circulation and money in circulation. The commodity is thrown out of circulation at a certain point and fulfils its definitive function only when it is definitively withdrawn from circulation, consumed, whether in the act of production or in consumption proper. The function of money, by contrast, is to remain in circulation as its vehicle, to resume its circular course always anew like a perpetuum mobile.
Nevertheless, this second function is also a part of circulation, equally with the first. Now one can say: to exchange commodity for commodity makes sense, since commodities, although they are equivalent as prices, are qualitatively different, and their exchange ultimately satisfies qualitatively different needs. By contrast, exchanging money for money makes no sense, unless, that is, a quantitative difference arises, less money is exchanged for more, sold at a higher price than purchased, and with the category of profit we have as yet nothing to do. The circle Money–Commodity–Commodity–Money, which we drew from the analysis of circulation, would then appear to be merely an arbitrary and senseless abstraction, roughly as if one wanted to describe the life cycle as Death–Life–Death; although even in the latter case it could not be denied that the constant decomposition of what has been individualized back into the elemental is just as much a moment of the process of nature as the constant individualization of the elemental. Similarly in the act of circulation, the constant monetarization of commodities, just as much as the constant transformation of money into commodities. In the real process of buying in order to sell, admittedly, the motive is the profit made thereby, and the ultimate aim is to exchange less money, by way of the commodity, for more money, since there is no qualitative difference (here we disregard special kinds of metal money as well as special kinds of coins) between money and money. All that given, it cannot be denied that the operation may come to grief and that hence the exchange of money for money without quantitative difference frequently takes place in reality and, hence, can take place. But before this process, on which commerce rests and which therefore, owing to its extension, forms a chief phenomenon of circulation, is possible at all, the circular path Money–Commodity–Commodity–Money must be recognized as a particular form of circulation. This form is specifically different from that in which money appears as a mere medium of exchange for commodities; as the middle term; as a minor premise of the syllogism. Along with its quantitative aspect, visible in commerce, it must be separated out in its purely qualitative form, in its specific movement. Secondly: it already implies that money functions neither only as measure, nor only as medium of exchange, nor only as both; but has yet a third quality. It appears here firstly as an end in itself, whose sole realization is served by commodity trade and exchange. Secondly, since the cycle concludes with it at that point, it steps outside it, just as the commodity, having been exchanged for its equivalent through money, is thrown out of circulation. It is very true that money, in so far as it serves only as an agent of circulation, constantly remains enclosed in its cycle. But it appears here, also, that it is still something more than this instrument of circulation, that it also has an independent existence outside circulation, and that in this new character it can be withdrawn from circulation just as the commodity must constantly be definitively withdrawn. We must then observe money in its third quality, in which both of the former are included, i.e. that of serving as measure as well as the general medium of exchange and hence the realization of commodity prices.