This proves that the sovereign is simply a quantity of gold --with a specific shape and a specific imprint --the weight of which is denoted by this name in the English monetary scale.The 4,6721/2gold sovereigns are thrown into circulation at different points and,once in the current,they make a certain number of moves each day,some sovereigns more and others less.
If the average number of moves made by one ounce of gold during a day were ten,then the 1,200ounces of gold would realise a total of commodity-prices amounting to 12,000ounces or 46,725sovereigns.An ounce of gold,no matter how one may twist and turn it,will never weigh ten ounces.But here in the process of circulation,one ounce does indeed amount to ten ounces.
In the process of circulation a coin is equal to the quantity of gold contained in it multiplied by the number of moves it makes.In addition to its actual existence as an individual piece of gold of a certain weight,the coin thus acquires a nominal existence which arises from the function it performs.
But whether the sovereign makes one or ten moves,in each particular purchase or sale it nevertheless acts merely as a single sovereign.The effect is the same as in the case of a general who on the day of battle replaces ten generals by appearing at ten different places at the crucial time,but remains the same general at each point.The nominalisation of the medium of circulation,which arises as a result of the replacement of quantity by velocity,concerns only the functioning of coins within the process of circulation but does not affect the status of the individual coins.
But the circulation of money is an external movement and the sovereign,although non olet ,[It does not smell.--Ed .]keeps mixed company.The coin,which comes into contact with all sorts of hands,bags,purses,pouches,tills,chests and boxes,wears away,leaves a particle of gold here and another there,thus losing increasingly more of its intrinsic content as a result of abrasion sustained in the course of its worldly career.While in use it is getting used up.Let us consider a sovereign at a moment when its original solid features are as yet hardly impaired.
"A baker who takes a sovereign one day,and pays it away to his miller the next,does not pay the veritable sovereign itself;it is a little lighter than when he received it."[1]
"It being obvious that the coinage,in the very nature of things,must be for ever,unit by unit,falling under depreciation by the mere action of ordinary and unavoidable abrasion ...it is a physical impossibility at any time,even for a single day,utterly to exterminate light coins from circulation."[2]
Jacob estimates that of the £380million which existed in Europe in 1809,£19million had completely disappeared as a result of abrasion by 1829,that is in the course of 20years.Whereas the commodity having taken its first step,bringing it into the sphere of circulation,drops out of it again,the coin,after making a few steps in the sphere of circulation,represents a greater metal content than it actually possesses.The longer a coin circulates at a given velocity,or the more rapidly it circulates in a given period of time,the greater becomes the divergence between its existence as a coin and its existence as a piece of gold or silver.What remains is magni nominis umbra ,the body of the coin is now merely a shadow.Whereas originally circulation made the coin heavier,it now makes it lighter,but in each individual purchase or sale it still passes for the original quantity of gold.As a psuedo -sovereign,or pseudo-gold,the sovereign continues to perform the function of a legal gold coin.Although friction with the external world causes other entities to lose their idealism,the coin becomes increasingly ideal as a result of practice,its golden or silver substance being reduced to a mere pseudo-existence.This second idealisation of metal currency,that is,the disparity between its nominal content and its real content,brought about by the process of circulation itself,has been taken advantage of both by governments and individual adventurers who debased the coinage in a variety of ways.The entire history of the Monetary System from the early Middle Ages until well into the eighteenth century-is a history of such bilateral and antagonistic counterfeiting,and Custodi's voluminous collection of works of Italian economists is largely concerned with this subject.
