Readings in Money and Banking: Selected and AdaptedPhillips, Chester Arthur
General
Readings in Money and Banking: Selected and Adapted
Phillips, Chester Arthur
Banks and banking; Banks and banking -- United States; Money
This advantage, however, forms but an inconsiderable part of the
economical benefits derived from the use of money. The inconveniences of
barter are so great, that without some more commodious means of
effecting exchanges, the division of employments could hardly have been
carried to any considerable extent. A tailor, who had nothing but coats,
might starve before he could find any person having bread to sell who
wanted a coat: besides, he would not want as much bread at a time as
would be worth a coat, and the coat could not be divided. Every person,
therefore, would at all times hasten to dispose of his commodity in
exchange for anything which, though it might not be fitted to his own
immediate wants, was in great and general demand, and easily divisible,
so that he might be sure of being able to purchase with it, whatever was
offered for sale. The primary necessaries of life possess these
properties in a high degree. Bread is extremely divisible, and an object
of universal desire. Still, this is not the sort of thing required: for,
of food, unless in expectation of a scarcity, no one wishes to possess
more at once than is wanted for immediate consumption; so that a person
is never sure of finding an immediate purchaser for articles of food;
and unless soon disposed of, most of them perish. The thing which people
would select to keep by them for making purchases, must be one which,
besides being divisible, and generally desired, does not deteriorate by
keeping. This reduces the choice to a small number of articles.
By a tacit concurrence, almost all nations, at a very early period,
fixed upon certain metals, and especially gold and silver, to serve this
purpose. No other substances unite the necessary qualities in so great a
degree, with so many subordinate advantages. Next to food and clothing,
and in some climates even before clothing, the strongest inclination in
a rude state of society is for personal ornament, and for the kind of
distinction which is obtained by rarity or costliness in such ornaments.
After the immediate necessities of life were satisfied, every one was
eager to accumulate as great a store as possible of things at once
costly and ornamental; which were chiefly gold, silver, and jewels.
These were the things which it most pleased every one to possess, and
which there was most certainty of finding others willing to receive in
exchange for any kind of produce. They were among the most imperishable
of all substances. They were also portable, and containing great value
in small bulk, were easily hid; a consideration of much importance in an
age of insecurity. Jewels are inferior to gold and silver in the quality
of divisibility; and are of very various qualities, not to be accurately
discriminated without great trouble. Gold and silver are eminently
divisible, and when pure, always of the same quality; and their purity
may be ascertained and certified by a public authority.
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