Mark (currency)

“ Just as the exchange value of commodities is crystallized by their process of exchange into gold money, so is gold money sublimated in its currency into its own symbol first in the form of worn coin, then in the form of subsidiary metal currency, and finally in the form of a worthless token, paper, mere sign of value. ”

“ Since the quantity of money, of a given value, which can be absorbed by circulation, is thus determined and since the value of money within the sphere of circulation manifests itself only in its quantity, it follows that mere tokens of value, if issued in proportions determined by the value of money, may replace it in circulation, and in fact, "a currency is in its most perfect state when it consists wholly of paper money, but of paper money of an equal value with the gold which it professes to represent." ”

“ MEASURES OF VALUE 1. English Money In all times money has been the weight of a certain amount of copper, silver or gold, in the form of coins the fineness of which is guaranteed by the stamp of the State. The weight of coins used in payments may change in course of time, but the nominal unit of weights often continues, the pound, or livre, or marc, &c. Thus, the original Roman unit, the As, or mint-pound of copper or bronze, reduced gradually to 1/24 of its primitive weight, persisted as a money of account long after it had been replaced in the currency by the silver Denarius. ”

“ It appears, therefore, that the value of money is liable to more frequent fluctuations when both metals are a legal tender at a fixed valuation, than when the exclusive standard of the currency is either gold or silver. ”

“ But no sooner does coin leave the mint, than it immediately finds itself on the high-road to the melting pot. During their currency, coins wear away, some more, others less. Name and substance, nominal weight and real weight, begin their process of separation. Coins of the same denomination become different in value, because they are different in weight. The weight of gold fixed upon as the standard of prices, deviates from the weight that serves as the circulating medium, and the latter thereby ceases any longer to be a real equivalent of the commodities whose prices it realises. ”

“ The value of an irredeemable paper currency constantly fluctuates. The importer of goods, the merchant, the manufacturer, when offering their articles for sale, first add to the price, at which they would sell under specie payments, the premium on gold. But they know also that they run the risk of the fluctuation and possible depreciation of the paper money they get for their goods, so that, if they sell on time, the sum of paper money they receive in payment, when the purchaser pays his note, may not represent the same gold value which the same nominal sum represented when the sale was made. ”

“ The Mode in which Credit is used as Money.—Economy in the employment of the precious metals is naturally suggested by ordinary experience; but the way in which states have profited by the expedient of depreciation affords a special inducement to follow what is practically the same course, and issue paper documents in place of the more costly metallic medium. In theory, as Ricardo explained, a paper currency is one in which the whole value has been appropriated as seigniorage. ”

“ Coins, being in fact merchandise, will follow the same rules of exchange, and will be attracted to those parts where they bear a greater exchangeable or market value. The actual value of a coin in currency must be that of its intrinsic value ”

“ This can only mean 26that impressions of his signet on clay, or some other substance, were put into circulation as representatives of value, and so received by the sellers. It is in the impression of a seal or stamp upon a piece of gold or other metal that we have the origin of coined money.
The study of the early history of coined money is a most curious one. Rude peoples pass from barter to the use of metallic currency; and the most general article of wealth is taken as the standard to which, either as a multiple or a fraction, all other possessions are adjusted. ”

“ When, however, new money, composed of some substance of supposed intrinsic value (as of gold) , is brought into the market, or when new notes are issued which are supposed to be deserving of credit, the desire to obtain the money will, under certain circumstances, stimulate industry: an additional quantity of wealth is immediately produced, and if this be in proportion to the new claims advanced, the value of the existing currency is undepreciated. ”

“ The first and most obvious method of attaining the object is to issue a paper currency which shall be redeemable, not in gold dollars of fixed weight, but in such quantities of gold and silver bullion as shall suffice to make the required purchases. ”

“ If the cheaper coin is forced into circulation, it will, if coined without limit, soon become the sole standard of value, and thus defeat the desired object, which is a currency of both gold and silver which shall be of equivalent value, dollar for dollar, with the universally recognized money of the world. ”

“ While the circulation of commodities can absorb only a definite quantity of gold coin and as a result of that the alternating contraction and expansion of the currency appears as a necessary law, paper money seems to enter circulation in any desired amount. While the state is guilty of debasing gold and silver coin and of disturbing their function of a medium of circulation, if it turns out a coin, only 1-100 of a grain below its nominal weight; it performs a perfectly proper operation by issuing absolutely worthless paper notes which contain nothing of the metal except its mint denomination. ”

“ Under cognisability we may properly include what has been aptly called impressibility, namely, the capability of a substance to receive such an impression, seal, or design, as shall establish its character as current money of certain value. We might more simply say, that the material of money should be coinable, so that a portion, being once issued according to proper regulations with the impress of the state, may be known to all as good and legal currency, equal in weight, size, and value to all similarly marked currency.... ”

“ Truly gold is a product of the country, and imports should be paid with surplus produce; but while the credit of the currency, and thus credit generally, is based on gold, that metal cannot be a surplus product, be the aggregate supply what it may. What the people desire of money is not redemption, but constancy of value. Government has declared that the dollar shall be the legal means of payment. ”

“ It has uniformly recognized in its fiscal affairs the distinction in value between paper currency and coin. Some of its loans are made payable specifically in coin, whilst others are payable generally in lawful money. It goes frequently into the money market, and at one time buys coin with currency, and at another time sells coin for currency. In its transactions it every day issues its checks, bills, and obligations, some of which are payable in gold, while others are payable simply in dollars. And it keeps its accounts of coin and currency distinct and separate. ”

“ On this occasion I addressed a letter to a noble Lord, who was then Chancellor of the Exchequer, suggesting what appeared to me the proper remedy for this evil. I proposed that, with a view to the general [Pg 234] reform of the coins of the realm, all the deficient gold coins should in the first place be called in and recoined, and that in future the currency of the gold coin should be regulated by weight as well as by tale, and that the several pieces should not be legal tender if diminished below a certain weight. ”

“ We place gold, and all such substances, on the side of documents, as far as they operate by signature;—on the side of store as far as they operate by value. Then the currency represents the quantity of debt in the country, and the store the quantity of its possession. The ownership of all the property is divided between the holders of currency and holders of store, and whatever the claiming value of the currency is at any moment, that value is to be deducted from the riches of the store-holders. ”

“ We will have the United States notes, the bank notes, and coin certificates, both gold and silver, together with the gold and silver itself, all in circulation. The actual amount of currency in circulation, I think, will be as large in specie times as now, and its equality and convertibility will rather increase than prevent the circulation of either. The depreciation of paper money is not necessarily caused solely by its excess, but by the uncertainty of its value and confidence in its redemption. ”

“ In speaking of coinage hitherto, the standard of value has been assumed to be the most important, but in fact a large proportion of our coin serves simply as currency without materially affecting the standard of value. ”

“ The price of a commodity or the quantity of gold into which it is ideally transformed, is, therefore, now expressed in the names of coins of the gold standard. Thus, instead of saying: a quarter of wheat is worth an ounce of gold, it is said in England to be worth 3 £ 17s. 101⁄2d. All prices are thus expressed in the same denominations. The peculiar form which commodities lend to their exchange values is transformed into a money-denomination by which commodities tell each other how much they are worth. Money in its turn becomes money of account. ”

“ I remember she bought points and some stuff for stocks, and needles and a reel of thread, and when she offered a gold piece everybody looked at us, and the shopkeeper called her "My lady" and me "My lord," and gave us in change for the gold piece a great handful of paper money.
We emerged from the shop amazed, and doubtful of the paper stuff, and walked up the street and out into the country, pausing under a great maple-tree to sort this new Continental currency, of which we had enough to stuff a pillow. ”

“ If the currency system of England had been of silver alone, a single enactment lessening the content of the unit coin, or crying up its denomination, would have stopped any outflow caused by under-valuation as compared with foreign money value. ”

“ The increase of paper money, it has been said, by augmenting the quantity, and consequently diminishing the value, of the whole currency, necessarily augments the money price of commodities. But as the quantity of gold and silver, which is taken from the currency, is always equal to the quantity of paper which is added to it, paper money does not necessarily increase the quantity of the whole currency. ”

“ While gold coin apparently represents the value of commodities only in so far as that value is itself estimated in gold or is expressed in price, the token of value seems to represent directly the value of commodities. It is, therefore, clear why students who examined one-sidedly the phenomena of circulation of money by confining their observations to the circulation of legal tender paper money, should have failed to grasp the intrinsic laws governing the circulation of money. ”

“ Although an inconvertible paper currency has no intrinsic value, it can (in accordance with the quantity theory of money) be maintained at a fairly stable ratio to gold or commodities by an honest government if the total issue is fixed, or kept between reasonable maximum and minimum limits. ”

“ In Anglo-Saxon and mediæval times the want of small coins—that is, a currency representing a small value—was much felt, and this gave rise to the occasional issue of spurious, or rather base, coins to supply the deficiency, as it was found the smaller pieces—for instance, the pennies when broken up for use as halfpence and farthings—were unfit for general use among the rough-handed population. ”

“ Ruding, from whom it has received the latest as well as the most elaborate investigation, comes, though not without hesitation, to the following conclusion: "That the penny, halfpenny, farthing, and half-farthing were actual coins; as was probably the triens, which divided the penny into three equal parts; and that the mancus, the mark, the ora, the shilling, and the thrimsa, were only money of account; or, that if the mancus was ever current among the Anglo-Saxons, it was a foreign coin, and was never imitated in their mints." [15] There is no doubt that the pound was merely money of account. ”

“ To measure prices by a currency that is called by the same names as gold, but that is really inferior in value to gold, and then—because those prices are nominally higher than gold prices—to say that they are inflated, relatively to gold, is a perfect absurdity. ”

“ The currency of the country is government paper, from one milreis upwards. Of gold there is considerable, of the value of twelve dollars each piece; there is no small silver, but the quantity of copper in circulation is enormous. It is not as bad as in China, where twelve hundred small coins go to the dollar; but here, if a milreis, valued at sixty cents, is exchanged, you obtain a thousand reis; the smallest coin is valued at ten reis, making it necessary to ballast equally well your pockets ”

“ With the growth of industry and commerce and the expansion of the system of contracts, covering a distant future, the evil effects of a shifting standard of value attract attention, and lead to the suggestion of ingenious devices to correct fluctuations. These belong to the later history of money and currency movements. It is enough for the ordinary purposes of money that it shall not alter within short periods, which is a characteristic of the more valuable metals, and particularly of silver and gold, while in contrast such an article as corn changes considerably in value from year to year. ”