St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1891-10-02
THE FUNCTIONS OF MONEY.

A correspondent writes to the GLOBE
as follows:
Space in your paper couldn't be put TO
better use than write-up on the silver ques-
ton. l am positive that out of st. Paul's
population you couldn't find more than one
ont of every twenty who understands or
knows what this silver question is. What 1
mean by mot knowing" is. sufficient knowl-
edge 10 justify man TO vote for or against
it, and / am one of those Democrats A clear
explanation of the silver question would be
read with interest.
All this is not the easiest thing in the
world to do in the limits of a>short
newspaper article, and, in general, a
clearer conception of such matters is to
be derived from reading the brief sug-
gestions and comments which appear
from day to day than any extended and
formal exposition will give. At some
expense of repetition, however, few
salient points in the discussion can here
be presented, and, If the GLOBES cor
respondent will then suggest his fur
Their difficulties, another effort can be
made for his enlightenment.
The initial step, in any consideration
of the problem, is to have some cOncep-
ton of the functions of money. These
are manifold, but two of them are par
ticularly noteworthy. Money is a
exchange. A community could get
along without currency, if it were
small enough, but, even then, it would
be very inconvenient. The man who
makes hats might trade his hats directly
with the baker for bread, if the baker
happened TO need hats for himself and
children. But if he could not find a
baker who needed hats he would be in
pretty uncomfortable position. In
such case, were there no money, he
would have to learn what the baker did
want. Suppose the bakers shoes were
worn out. Then the halter would have
to hunt for cobbler who needed a hat,
and, trading hat for pair of shoes,
take the shoes to the baker and trade
them again for bread.
This would be very cumbersome
and practically impossible process, but
money obviateS its difficulties. With a
currency in existence the latter can sell
his goods to anybody who cares for them
without inquiring at all whether the
things which the purchaser makes are
whathe himself needs or not. He does
not take the purchasers goods IN trade,
but his money. With this money he
goes directly to the baker without
searching for the cobbler in the mean
while. He gives the baker money and
the baker gives him bread for it. Then
when the baker gets the leisure to buy
his shoes he uses this money again for
the Durpose. The delays and over
whelmiDg inconvenience of system
without currency are thus disposed of.
Money is accepted as an equivalent for
commodities by everybody because
everybody knows that he can use it
again, when he has occasion to. to pro-
cure commodities for himself. That is,
money is medium of exchange. 1t is
the go-between in trade.
Again, if the halter had to barter his
hats for bread directly, it would be hard
to tell how many loaves of bread ought
TO be given for hat. There would be
endless higgling over the point, and it
might take lifetime to reach conclu-
sion. But money affords standard.
The halter knows how much labor and
material he has put into his goods, and
he calculates the result as aggregating
certain total in dollars. The baker
does the same thing. and he fixes the
number of loaves of bread in dollar in
the same way. 1t is thus possible to
measure bread against hats OF any other
commodities automatically and without
exhaustive inquiry. Money is the
means of etfecting this measuring. The
value of everything being estimated in
dollars, the value of everything in ref
erence to everything else is thus readily
and clearly fixed.