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There is such a thing as a measure or standard of value whenever we use anything as such. It is constituted such either by force or by agreement. Its function is implied in its name—measure of value. Without the selection, deliberate or accidental, conscious or unconscious, of something as a standard of value, money is not only impossible, but unthinkable.

"9. What becomes of the 'standard' or 'measure' of value during suspensions of specie payment?"

Nothing. It remains what it was before. Certain parties have refused to pay their debts; that's all.

"10. Are you in favor of free trade in banking, including the issue of paper money? If not, why not?"





[Liberty, June 13, 1891.]

Readers of Liberty will remember an article in No. 184 on "The Functions of Money," reprinted from the Galveston News. In a letter to the News I commented upon this article as follows:

I entirely sympathize with your disposal of the Evening Post's attempt to belittle the function of money as a medium of exchange; but do you go far enough when you content yourself with saying that a standard of value is highly desirable? Is it not absolutely necessary? Is money posible without it? If no standard is definitely adopted, and then if paper money is issued, does not the first commodity that the first note is exchanged for immediately become a standard of value? Is not the second holder of the note governed in making his next purchase by what he parted with in his previous sale? Of course it is a very poor standard that is thus arrived at, and one that must come in conflict with other standards adopted in the same indefinite way by other exchanges occurring independently but almost simultaneously with the first one above supposed. But so do gold and silver come in conflict now. Doesn't it all show that the idea of a standard is inseparable from money? Moreover, there is no danger in a standard. The whole trouble disappears with the abolition of the basis privilege.

The News printed my letter, and made the following rejoinder:

It will occur that in emphasizing one argument there is such need of passing others by with seeming unconcern that to some minds other truths seem slighted,—truths which also need emphasizing perhaps in

an equal, or it may be, for useful practical reasons, in a superior degree.