Page:Reflections on the Formation and the Distribution of Riches by Anne Turgot.djvu/101

S76

The rate^[1] of interest, like that of merchandise generally, should be fixed by nothing but the course of trade.

I have already said that the price of borrowed money is regulated, like that of all other merchandise, by the balance of supply and demand:^[2] thus, when there are many borrowers who need money, the interest of money becomes higher; when there are many holders of money who offer to lend it, interest falls. It is, therefore, another mistake to suppose that the interest of money in commerce ought to be fixed by the laws of Princes. It is a current price, fixed like that of all other merchandise. This price varies a little, according to the greater or less security which the borrower has that he will not lose his capital; but, with equal security, it ought to rise or fall in proportion to the abundance and need, and the law ought no more to fix the rate of the interest of money than to set a price for any other merchandise that is circulated in commerce.

S77

Money^[3] has two different valuations^[4] in commerce: the one expresses the quantity of money we give to procure the different sorts of commodities; the other expresses the relation of a sum of money to the interest it procures in accordance with the course of commerce.

1. Le taux.
2. Par la balance de l'offre à la demande.
3. L'argent. [The use of this word both for money and for silver contributes to the ambiguity which Turgot here seeks to remove. It is here translated silver, whenever that is implied by the context.]
4. Évaluations.