Peoples who, like savages, have few products to trade, and organized peoples who have only two or three kinds, deal by exchange. Thus the Moors’ caravans which go to Timbuktu in the heart of Africa to barter salt for gold have no need of money. The Moor puts his salt in a heap, the Negro his (…)
Money is a sign that represents the value of all merchandise. A metal is used so the sign will be durable, will be little diminished by use, and can without deterioration be multiply subdivided. A precious metal is chosen so the sign can easily be carried. A metal is most suitable to serve as a (…)
There are real monies and ideal monies. Organized polities, almost all of which use ideal moneys, do so only because they have converted their real moneys into ideal ones. At first their real moneys are a certain weight and a certain purity of some metal ; but soon bad faith or need leads to (…)
When the organized polities are masters of the world, gold and silver increase by the day, either because it is obtained domestically, or because it is fetched wherever it is. It decreases, on the contrary, when barbaric nations prevail. We know how scarce these metals were when the Goths and (…)
The silver taken from the mines of America, shipped to Europe, and from there sent to the Orient, favored European navigation ; that is one more product which Europe receives in exchange from America, and sends to exchange in the Indies. A greater quantity of gold and silver is therefore (…)
The Inca Garcilaso says that in Spain after the conquest of the Indies, interest, which was at ten percent, fell to five percent. That is what had to happen. A large quantity of silver was all at once shipped to Europe ; soon fewer people needed silver, the price of everything went up, and the (…)
Silver is the price of merchandise or commodities. But how shall this price be set ? In other words, by what portion of silver shall each thing be represented ?
If we compare the mass of gold and silver which is in the world with the sum of merchandise it contains, it is certain that each (…)
The Blacks of the African coast have a sign of values without money : it is a purely ideal sign, based on the degree of esteem they place in their minds on each commodity, in proportion to their need of it. A certain item or commodity is worth three macutes ; another, six macutes ; another, ten (…)
Besides the positive abundance and scarcity of gold and silver, there is also a relative abundance and scarcity from one of these metals to the other.
Avarice holds onto gold and silver, because, as it does not want to consume, it likes signs that do not deteriorate. It would rather keep gold (…)
It is the relative abundance and scarcity of the moneys of various countries that makes up what we call the exchange.
The exchange is a setting of the current and transitory value of moneys.
Silver as a metal has a value like all other commodities, and it further has a value that comes from (…)
Montesquieu
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