Capital is always in the form of definite capital goods. These capital goods are better utilizable for some purposes, less utilizable for others, and absolutely useless for still other purposes. Every unit of capital is therefore in some way of other fixed capital, i.e., dedicated to definite processes of production. The businessman's distinction between fixed capital and circulating capital is a difference of degree, not of kind. Everything that is valid with regard to fixed capital is also valid, although to a smaller degree, with regard to circulating capital.
All capital goods have a more or less specific character.
The more a definite process of production approaches its ultimate end, the closer becomes the tie between its intermediary products and the goal aimed at. Iron is less specific in character than iron tubes, and iron tubes less so than iron machine-parts. The conversion of a process of production becomes as a rule the more difficult, the farther it has been pursued and the nearer it has come to its termination, the turning out of consumers' goods. In looking at the process of capital accumulation from its very beginnings one can easily recognize that there cannot be such a thing as free capital. There is only capital embodied in goods of a more specific character and in goods of a less specific character.