Were money merely a medium of exchange, some-
thing to be spoken into being for each act of traffic
and then annihilated, permanence in its worth could
be dispensed with. But money, also, besides furnish-
ing our system of value-denominations, measures value,
serves as a reservoir of value, and as a standard for de-
ferred payments. To fulfill ideally any one of the
last-named offices it must preserve its general pur-
chasing power unchanged.
Increase in the value of money robs debtors. It
forces every one of them to pay more than he cove-
nanted, — not more dollars, but more value, the given
number of dollars embodying 'at date of payment
greater value than at date of contract. Decrease in
the value of money robs creditors, necessitating each
to put up, in payment of what is due to him, with a
smaller modicum of value than was agreed upon.
Such loss, whichever the direction of its incidence,
is a misfortune not only jurally but also economically.
It \% so much friction against the natural and desirable
free play of exchange among men. In case money
gains in power over commodities, so that prices fall,
a quite special degree of this friction is experienced.
Under such circumstances money and titles to money



• backers have enough reason to appeal to Ricardo ; yet Sir Jas. Steuart
was the first to advance the idea of a currency without a specific stand-
ard. Ricardo was no absolutist. He proposed to continue gold as the
standard, though doing nothing to regulate it. Thomas Aquinas [Op.
Paris, i87i-*8o, vol. xxv., p. 455, cited by Horton, Moit. Hist, and Mon.
