Descriptive economics; by unknow

Author:unknow
Language: eng
Format: epub
Tags: Economics
Publisher: [Rochester, E. R. Andrews, printer]
Published: 1893-03-25T05:00:00+00:00

having as much purchasing power as on the day of sale. Its value is reasonably fixed and it thus becomes a standard of value.

4. A Store of Value. —The Eussian peasant who exchanges his ox for tea bricks and then migrates to America with his wealth in that form, would be worth much less after arriving here. His tea bricks would not be in demand. The commodity which is to take the place of money must be acceptable the* world over, so that value may be stored up and carried from one part of the globe to the other without depreciation. What commodity is better adapted to be a store of value than the precious metals ?

Government Coinage. —The precious metals in their natural state will fall short of performing the four functions of money which have just been enumerated. They must be coined or minted into forms of certain values under the sanction of government. The raw metal must be fashioned into pieces of prescribed weight and fineness, and this must be done by government in order to insure the proper weight and purity. Government can do nothing more toward creating money than lies in the regulation of the weight and fineness of its various coins. It can prescribe the number of grains of gold which shall go into a dollar just as it can determine how many pounds of wheat shall make a bushel. It cannot take that quantity of gold which cost only a dime to mine and mint and is therefore worth only a dime in the market and make a dollar out of it. Government may stamp it a dollar and call it a dollar, but it will not pay for a dollar's worth of labor or buy anything which has cost a dollar's worth of labor. You will understand now what is meant by people who speak of money as a creation of government. Government legalizes the coinage and declares what coins we shall have, but does not create money or create value. Gold and silver as well as all other commodities are worth just what it costs in labor to produce them. These facts have- such economic importance that they will be repeated in connection with the discussion of " The money of the ^Nation."

Municipal Economy Summarized. —At the end of Part I

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