Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1819-06-18

(o) Black. Com. pa.77.
(p)FatteI, pa. Az.
POLITICAL ECONONY.
FOR THE ENQUIRER.
VALUE OF MONEY.
The last number OF the Edinburg Re
view has adopted certain prn,ip!e on
til" vaiue IF money, which seem to be in
correct.
They say that
"Bniiiou il commodity on the production of
wliish, competition operates without ANY re-
straiUt Ii L. not subjected 10 any species of
nionopoly,-and its valae in exchange must
therefore, be entirely regulated by the cost
OF its productions that is, by TIE quantity of Ia
hour necessary to bring any quantity of il to
market" "Whie competition is allowed To
operate without restraint on the production OF
gold and silver, they will, like all oiheTcommod
tiles be valuable only in pToPort OIL tolhe guam
tity Of iabnur necessarily expended in bring
ing them 10 market And hence, while they
constitute the currency of the commercial
world, the price of commodities, or their val
ne, compared with gold and silver, will vary
not only according to tie variations in the real
value of the commodities Themselves, hut also
according 10 the variations IN the real value of
The gold and silver with which they are COM
pared - Wherever the supply of money
becomes fixed, the amount OF il TO be Civ
en- IN exchange for any one commodity, varies
| inversely as he demand aud is altogether
unaffected by any other circumstance"
Almost every writer, of authority, on Po-
l liticai Economy, has maintained that the value
| of money depended entirely on the relation
| bstween the supply and the demand. But this
| is true only of a gold currency limited i'll its
| quantity, or or paper cnrreHcy also limited
| III IT'S quantity, and not convertible into gold
| and silver. Such currency not being pos
| seSsed of any intrinsic value its worth IN ex.
| change Is necessarily regulated by the proper
| ton which its total amount bears TO the bust
| ness which II has TO perform, or 10 the demand;
| and the general opinion. that the prices Ol
commodities depend on the proportion be
( tween them and money, and that any conSlds-
| rshle increase or dimiiiution OF either, would
\ have the etfect ct proportOnabiY diminishing
J or increasing money prices, would, in such
| crc1mstances,- be quite correct. Its aitoge
Their different, however, with currency con-
| sisting o! gold and silver, or of any other com
modify whose cost of production is cousid erd-
! Bile, aud the quantity of which may be increas
ed to an unlimited extent by the operation OF
/ unrestricted competition.
II is not the ratio between the supply and
demand for such money, which can operate
any permanent effect On its value but il IL the
| comparative cost of its production, or, as Mr.
Ricardo has demonstrated. the comparative
| quantities of td5our necessary to bring il 10
| market. II a guinea ordinarily exchanges for
couple OF bushels OF wheat, or hat, IL is he
| canse the same labour has been expended OIL
| its production on that of either of these
| commodities while, if, with limited paper
| currency, such commodities exchanged fer a
piece al eDgrsVcn paper denom mated guinea
| note, il would only be because sucl was the
proportion which, as part of the general
mass of circulating commodities, they bore to
| the supply OF paper IN the market. This pro
portion would be affected by all increase or a
| diDlirution Of the supply either of paper or
| commodities. But the relation wh ich cornmo-
| dities bear TO a gold currency, can only be
| permanently affected by change in the guam
| tity OF IsbOur necessary TO manufacture the
| commodities. or 10 produce the gold for which
| theS are exchanged.
We must here caution our readers again
| snppOsns that we all TO insinuste that II
| value of gold aud silver caunot he affected b,
| the comparative state of the demand for, and
| the supply of, these metals. Certainly how
I ever they ave infinitely less affected by sncII
| fluctuations than almost any other commodity
| with which we are acquainted Their great
| durability, aud the care universally taken 10
| preserve them, preclude the possiblity of ans
| sudden dminBtion of their quantity. while the
immense surface over Which they are spread
\ aud the varIons purposes 10 which they are
| applied, prevent any nuusnal productiveuess
4 OF the mines from speedily lowering their va
lue. An extraordinary event, such as the dis-
| oovery of America, or the establishment OF an
| Intercourse between country where bullion
| bore very high value and one " here its value
| from the greater facility of its production, i.
| comparatively low, might, by suddenly ~.
4 CEtdStIlg tue supply, bink us Naiue CO0SlueTd-
| bly, Bnt such events must necessarily be OF
| very rare occurrence. Aud although The value
| OF gold and silver, because Of the different qua.
! lties of the mines, 90 Which, in the progress oil
| society. recourse must be had and, because
( OF the successive Improvements in the art Of
| mining aud working etals, be very different
| at distant peIiods,--t is abundantly uniform
| to secure us agaInSt every risk of sudden and
| injurious fluctuations.
The statement of the Reviewers seem
10 be siHgularly deficient Impression and
| correctness.
LIST. "Ihe cost Of production" is a cor
rect expression ; but surely il is not sy
nOnimous with the comparative qaanti
ties N iobor necessary 10 bring IL TO mar
kct." For IL is not The labor alone Which
tie metal Is 10 pay tor; il is TO pay be
aides the rent OF The lasd which contains
the mine, and the proft Of the capita
which works IT. But let this pass
81. la the same sense i'm which tic Re
viewers saS IN value of gold and sllve
depends Upon the coa Of production, they
might say iIat tie value OF cUe,y article
which IS left 10 the operation Of an un
restricted competition" depends upon IT,,
cost oi us production. II is not becaus
the "cOsi oi production is considerable,
that the principle is true of The metals
for every article IS hicil !. llre 10 compeii
ton. from toothDick ia ~, ingotof GOLD