the owners of commodities which, though constituting the natural foundation of the credit system, may be fully developed before the latter comes into existence. It is clear that with the extension of the credit system, and, consequently, with the development of the capitalist system of production in general, the function of money as a means of payment will extend at the expense of its function as a means of purchase and, still more, as an element of hoarding. In England, e. g., money as coin has been almost completely banished into the sphere of retail and petty trade between producers and consumers, while it dominates the sphere of large commercial transactions as a means of payment.[1]
As the universal means of payment money becomes the universal commodity of all contracts, at first only in
- ↑ Mr. MacLeod, in spite of his doctrinaire conceit about definitions, fails so utterly to grasp the most elementary economic relations that he tries to deduce the very origin of money from its crowning form, viz., that of a means of payment. He says among other things that since people do not always need each other's services at the same time, and not to the same extent, "there would remain over a certain difference or amount of service due from the first to the second—debt." The owner of this debt needs the services of a third person, who does not directly need those of the second, and "transfers to the third the debt dut to him from the first. Evidence of debts changes so hands—currency. . . . When a person received an obligation expressed by metallic currency, he is able to command the services not only of the original debtor, but of the whole of the industrious community." (MacLeod, "Theory and Practice of Banking," etc., London, 1855, v. I., ch. I.)
