Value for money

“ And this is not a question of any difficulty, when the illusion is dispelled, which caused money to be looked upon as a peculiar thing, not governed by the same laws as other things. Money is a commodity, and its value is determined like that of other commodities, temporarily by demand and supply, permanently and on the average by cost of production. ”

“ As we saw in the last chapter that it is impossible for anybody to understand the subject of Credit without first comprehending the matter of Value, so we shall see in this chapter that in the order of Nature Value precedes Money, and that the latter can only be learned in the light of the former. The logical reason for this in general is, that Money itself is always a Valuable, and comes to its function as money only through a comparison of itself with other Valuables. ”

“ In common discourse, wealth is always expressed in money. If you ask how rich a person is, you are answered that he has so many thousand pounds. All income and expenditure, all gains and losses, everything by which one becomes richer or poorer, are reckoned as the coming in or going out of so much money. It is true that in the inventory of a person's fortune are included, not only the money in his actual possession, or due to him, but all other articles of value. ”

“ When a man says he wants money to use, he means only that he wants to part with it,-that he wants either to pay a debt with it, or to give it in exchange for something that he can use or consume.
5. We can have at least a hundred and fifty times as many paper dollars as we can gold and silver dollars. And yet every one of these paper dollars, if it represents a dollar s worth of actual property that can either be itself delivered in redemption of the paper, or can otherwise be made available for the redemption of the piper, will have the same value in the market as the coins. ”

“ By MONEY, I understand any commodity, which purely in itself is of no material use to man for the purposes above-mentioned, but which acquires such an estimation from his opinion of it, as to become the universal measure of what is called value, and an adequate equivalent for any thing alienable. ”

“ No one wants money except for the purpose of exchanging it for other commodities; under modern conditions it is necessary for this purpose,—it is the indispensable requisite to the satisfaction of certain human wants. Money, therefore, possesses an indirect if not a direct subjective value which forms the basis of its exchange value. ”

“ To the writers of this school, it is incredible that anything which has no utility should become money. Money must be either valuable itself, or else a representative of some valuable thing. The value of money comes from the value of the standard of value, and that value may, so far as the logic of the situation is concerned, be as well explained by marginal utility as the value of anything else. ”

“ Since the value of the money in use in any society is insignificant as compared with its total wealth valued in terms of money, it has been argued that the function of money as a measure of value is far more important than its function as a medium of exchange. ”

“ It seems that wealth had existence before money was thought of. Wealth is substance, of which money is the principle or representative, but which, in itself, has no intrinsic value.
Money is an invention made to represent wealth, or value, in order that its various kinds may be exchanged with facility, or that they may be exchanged without the absolute and direct and immediate receipt and delivery of one product of labor for another product of labor. ”

“ Money represents value; but value is not a thing, nor does it reside in things. Value is demand, desire, esteem, want, wish—it is a power existing in persons—the motive-power of the population — a power that may be represented immediately, if necessary. Then, the representative of the unit of population, and thus of value will be the true money unit. But it may also be represented through the medium of the dollar, at a fixed rate per capita. When this is done, by proper authority, true money will exist. ”

“ When we consider the transcendantly important character of the service which money performs—when we reflect that, without it, the achievement of an advanced civilization would be impossible, we can not escape the conclusion that, compared with the value of that service, the commodity value of any material on which the money function may be stamped is too trifling to merit serious attention. ”

“ In one word, Value in the form of money is in a more available shape for general buying and selling than value in any other form. This is the exact and ultimate expression for all the truth there is in the common vague remark, namely, that Money is something different from all other Valuables; it is different from them in just one respect, namely, while they have the power of buying some things from some persons, it has the power derived from the consensus of Society to buy all sorts of things from all sorts of persons. ”

“ Value of money and values of goods determine prices; prices and quantity of goods determine demand for money; demand and supply of money determine value of money,—a hopeless circle.
I know no sense in which the terms, demand and supply of money, can have relevance to the problem of the value of money. There is one sense in which the terms can be used which fits in with the modern supply and demand-curves, and that is the sense in which they are used in the money market. Demand for money comes from borrowers; supply of money from lenders. ”

“ But this is not to assert the doctrine of the commodity school, that its value must arise from the metal of which it is made, or in which it is expected to be redeemed. Nor is it to deny that the money function may add to the original value. On the contrary, the services which money performs are valuable services, and add directly, under conditions which we shall analyze more fully in a later chapter on the functions of money, to the value derived from non-pecuniary sources. Value is not physical, but psychical. And value is not bound up inseparably with labor-pain or marginal utility. ”

“ If men anticipate that the value of the income, which is a fixed sum of dollars, is to grow less in the future, then the present worth of the bearer of that income will shrink to an extent greater than the "pure rate" of interest would call for. ”

“ Wine and women, pictures and beautiful things, leisure for research and contemplation,—money buys any and all of these, and as the symbol of all kinds of value, as the symbol of all kinds of power, it is sought assiduously by all kinds of men.
There are many who start on their careers with the feeling and belief that money is a minor value, that to be useful and of service is greater than to be rich. ”

“ Money is so little a mark of value, that if the pieces of money lose a part of their value by friction, from use, or by the knavery of the clippers of money, all goods rise in price in proportion to the alteration which they have experienced ”

“ The value of money must depend, not on prices alone, but, as I have said, also on the standard of living, on wages, on hours of work, on the cost of things, on plenty and scarcity, on taxation, and on many other considerations. ”

“ The personal value of money depends on the relation between an individual's money income, and his real income, in terms of goods. The public economic value of money depends on the money income of the community as a whole, and its real income. ”

“ The direct inquiry can now be made as to what will best perform what the people require of money; and money is that which can be used to represent real values without an absolute transfer of such values. The basis of all value of this country is our present accumulated real wealth and our capacity to increase it, and this accumulation and the prospective increase may be wholly represented by money and the nation never become bankrupt.
A person may possess wealth to the amount of ten thousand dollars upon which he may issue his representatives of value or promises to pay that value. ”

“ The material of money must not only be valuable, but the value must be so related to the weight and bulk of the material, that the money shall not be inconveniently heavy on the one hand, nor inconveniently minute on the other. ”

“ In whatever degree, therefore, the quantity of money is increased or diminished, other things remaining the same, in that same proportion the value of the whole and of every part is reciprocally diminished or increased. ”

“ In what kind of money will you prefer to receive the wages of your labor or the profits of your business—in a kind of money whose value or purchasing power is stable and can be depended upon to remain virtually the same from day to day, and from week to week, or in a kind of money whose value and purchasing power are fluctuating and uncertain, so that you do not know what it will buy from one end of the week or of the month to the other? Every sensible man who in the least understands his own interests will answer, instinctively: “Give us the first—the money of stable value ”

“ For writers who seek the whole explanation of the value of money in its monetary application, and who see that money, qua money, cannot administer directly to human wants, the view that Professor Fisher expresses, namely, that money has no utility, and is unique among goods in this respect, seems on the surface, to have justification. ”

“ A greater amount has a smaller significance per unit. The marginal amount of gold put to work as money has a comparatively low significance in that employment—a significance just great enough to secure it from the competing employments in the arts.
We conclude, then, that money must have value to start with, from some source other than the money function, and that there must always be some source of value apart from the money function, if money is to circulate, or to serve as money in other ways. ”

“ Those who possess money are in a position to take toll, in values, from those who wish to get rid of the goods which they have produced, and to get hold of the goods which they wish to consume. The holders of money do this by means of the money, and under the laws of economic imputation, these gains are attributed to the money itself, first in the form of a rental value, and sometimes, under conditions later to be discussed, as increments to capital value. ”

“ But this is to explain value, not by marginal utility alone, but by value as well—a circle. Or, if we leave the standpoint of absolute values, and look at the matter in terms of prices, the same situation presents itself. The price which an individual is willing to pay for a good depends on his income,—which commonly rests on prices—and on the prices he has to pay for other goods which enter into his budget. ”

“ The higher value of money is its spiritual capacity. Not what it will bring me is primarily important, but what I can buy with it for the race. Sometimes the question comes over me: What am I trading for money? ”

“ Money may be defined as a generally accepted material means of payment and medium of exchange. This, its primary and essential function, may appear to be less important as new modes of balancing accounts of wealth are devised. But its functions as a common denominator of values and as a standard of deferred payment are increasingly important in an advancing society. It is this expression of the value of all other things in terms of money which may well be deemed the essential characteristic of the capitalistic age. ”

“ On the other hand, the money use is a valuable use. Exchange is a productive process. Money, as a tool of exchange, enables men to create values. And you can measure the value of the money service very easily at a given time if you look at the short time "money-rates," i. e., rates of discount on prime short term paper. These are properly to be considered, not interest on abstract capital, but the rent of a particular capital-good, namely, money. The money is hired for a specific service, namely, to enable a man to get a specific profit in a commercial transaction. ”

“ It might well be, therefore, that the rise in the values of goods would offset the rise in the value of money, and that prices of goods would rise at the same time that gold is being withdrawn from the money market to the arts. ”

“ So with the young man starting in business; let him understand the value of money by earning it. When he does understand its value, then grease the wheels a little in helping him to start business, but remember, men who get money with too great facility cannot usually succeed. You must get the first dollars by hard knocks, and at some sacrifice, in order to appreciate the value of those dollars. ”

“ Like any tool or agent, money is valued for what it does or helps to do. It enhances the value of the goods that it buys and sells by dividing them into quantities convenient for use and by making them available at the right times. In the light of the principles of diminishing gratification and of time-preference it is clear that the amounts in which, and the times at which, goods are available have an essential bearing on their values. ”

“ Seasonal calls on an inelastic money supply for actual cash to move crops and pay agricultural wages may make a real difference in the value of money; scarcity of money of the right denominations for retail trade may give an agio to such money, [550] but the money and credit used by specula [Pg 523] tors, bill brokers, dealers in foreign exchange, investment bankers, etc., increases, rather than decreases, the funds available for ordinary industry and commerce. ”