THE STATE THEORY OF MONEY
CHAPTER I
PAYMENT, MONEY AND METAL
§ 1. Autometallism ; Nominality of the Unit of Value
Money is a creature of law. A theory of money must therefore deal with legal history.
The favourite form of money is specie. As this implies coins, most writers have concluded that currency can be deduced from numismatics. This is a great mistake. The numismatist usually knows nothing of currency, for he has only to deal with its dead body; he has no ready way to the understanding of paper money pure and simple. It may be a dubious and even dangerous sort of money, but even the worst sort must be included in the theory. Money it must be, in order to be bad money.
Nothing is further from our wishes than to seem to recommend paper money pure and simple in such a form, for instance, as the Austrian State Notes of 1866. It is well for any State to wish to keep to specie money and to have the power to do so. And T know no reason why under normal circumstances we should depart from the gold standard. I say this at once to reassure the public man. Still, in this book
