Class 03 - Chapter 3

So, money makes the world go round, they say. Yes. You know, it's so fascinating. Money, we all use it. We all worry about it. We all spend an enormous amount of our time getting it. But if you ask anybody the question, what is money? Most people can't give you a clear answer at all. And I always remember this great line in Dickens, Dombey and Son, where the little Paul, his mother has died, and he's very sickly, and he keeps on asking his father, Papa, what is money?

What is money? And Mr. Dombey, who's the great entrepreneur, merchant, can't give an answer. And at some point or other he says, well, it's something that allows you to do lots of things. So little Paul says, well, why can't it bring mama back then? And Mr. Dombey is so flummoxed, he kind of just leaves the room. And I think this kind of question of what is money? and what's its function in society is really something that is a mystery to everybody.

And yet it's something that we're constantly focused on. So here we are focused on this thing and we don't know what it is. And I think what Marx tries to do is to tell us. something about money, which we hadn't really understood before. And so the theory of money in Marx, but he gets pretty lost because it's very, very complicated. So it's a difficult, the third chapter is probably the most difficult chapter in the book for almost everybody to get through.

Historically, when you ask people, well, you started reading Capital on your own, when did you give up? Well, they nearly always gave up in Chapter 3. So one of my tasks is to get people through Chapter 3 without... and get them to the other side of it, and then it's almost like you come out of purgatory and you're into heaven after that. Into the good stuff. Yes.

Okay, so let's start on this chapter on money. I have to say New York City and this time is a good kind of situation to reflect on. all of this, but we have to remember this chapter was written nearly 150, 140 years ago, and so there is a question as to how much of the analysis stands and obviously something you'll have to think about as we go through it. The chapter usually poses quite a bit of difficulty for people.

I think I mentioned early on that many people who start reading Capital kind of give up on this chapter because it just gets too dense and too complicated and it's very hard to figure out what's going on.

But if you stick with the sort of framework that I've suggested you think about, whenever you approach a chapter like this you think about its structure so that you remember where you are in this broader… argument and the argument here is again actually fairly simple and it has a very similar form to those which you've encountered before, so you'll probably get sick of me putting this kind of formulation.

up on the board, but he starts with the idea of commodity money, or money as a commodity. As usual, he asks a number of questions, what work does this commodity do, what functions does it perform and all the rest of it, and he surprisingly finds a duality. We've seen this before. And the duality is that it's a measure of values and it's also a means of circulation.

and those two functions are going to turn out to be somewhat incompatible with each other and he's going to spend the first part of the chapter looking at the measure of values function and the complications which attach to that. The second part is about the means of circulation and the complications that attach to that. and then of course at the end he comes back to the issue of universal money.

which, you will be surprised to know, internalizes a contradiction. What else is new about Marx's method of presentation? But this is basically what he does. Part of the difficulty here is that, much as he inserted into the section about concrete and abstract labour, extra elements which broaden the argument, he actually sets up a mini-bifurcation in here over

money as a measure of value and a standard of price." So he kind of does a mini version of this inside. He does the same mini kind of diversion. in means of circulation, in particular looking at concrete monies like gold coins and symbols. and asks the question, what's the relationship between this real stuff and this, and that's going to lead him into discussing things like money as money of account, credit monies, all those other kinds of…

forms of money. So, in effect, what happens here is he starts to elucidate the complicated world of money activities via this strategy. The basic structure of the chapter is an echo of what you saw in the section on commodities, the section on abstract and concrete labour, the relative and equivalent forms, he's just doing the same thing over again. So, if you have that in mind then you're less likely to get lost.

in the intensity of the argument of this chapter and the details of the argument in this chapter, important though those details are. sort of set the argument up this way is because when you're wrestling with the details, sometimes the details are fascinating and important in their own right and you need to work on them very hard. has is a framework within which that argument is proceeding. And this is, as it were, the framework of the chapter. So, with that in mind, let's look at…

this piece of the story, money as a measure, or the money commodity as a measure of value. And obviously there's going to be a transition in this chapter from talking about the money as a commodity, the money commodity, to money as universal money, which of course nowadays would not be represented by a particular commodity at all.

it'd be represented by something else, but I think we can see shadows of that in Marx's interpretation. Now, what he does, again for purposes of simplification, is to say… I'm going to assume, for the most part in this chapter, he occasionally introduces silver and then sometimes talks about other things, but I'm going to assume that the commodity money is gold. So I'm going to use the example

of gold. And just assume that that has become the money commodity which we are interested in looking at. and immediately what he does is to say, at the bottom of the first page here, money as a measure of value is the necessary form of appearance.

in past talks, insisted that you think a lot about social necessity. What is socially necessary? And here he's saying that this form of appearance is a necessary form of appearance, it's socially necessary, and it's necessary as a measure of value which is imminent in commodities, namely labour time, or more accurately, socially necessary labour time.

So there's an interrelation then between the world of commodities and the socially necessary labour time which is embodied in all of those commodities, and the socially necessary labour time which is embodied

in the gold. But then he goes one step further immediately, at the bottom of 189, when he says, the price or money form of commodities… is, like their form of value generally, quite distinct from their palpable and real bodily form. It is therefore a purely ideal or notional form." By ideal here, Marx means mental. that it is constructed in our minds. Although invisible, and several times I think

mentioned the significance of these invisibilities, these immaterialities, which are nevertheless objective and real. And he then goes on to say, The guardian of the commodities must therefore lend them his tongue or hang a ticket on them in order to communicate their prices to the outside world." Now what's happening here is this. I have a commodity. I have no idea what its value is. How can I possibly know, before I take it to market?

But when I take it to market, I want to have a notional value which I put on it, so I hang a price tag on it and say, this is worth this. It's a mental move on my part, I'm guessing.

It's only after the market has gone through all of its ferment and done its work that I know what the value is represented by in its money form. But as a standard of price, as he puts it on the next page, or rather two pages later, as a standard of price, money is performing a different function from simply as a measure of value. On 190 then he wants to talk first off about this imaginary side, the ideal side of the money form. I'm imagining what the value is in my commodity.

But then the price itself depends upon the substance that is money. And this then poses the first problem. which is signalled at the bottom of this page. The money commodity is gold. Since it is a distinctive commodity… It is produced under given conditions of production. So, how much gold there is and what gold is worth and what the socially necessary labour time is that's embedded in gold is going to vary.

So immediately there is a problem, not on the side of all of those commodities which are being measured in terms of the money commodity, but in terms of the money commodity itself. So he has to deal with the prospect of inflation… or deflation because there's not much money around or there's a lot of money around, and in particular there's a lot of gold around or not much gold around, so there is a problem of the gold supply.

His point about this is, well, yes we have to take that into account, but actually the relative values of commodities is not affected by that. That is, shoes cost twice as much as shirts, and the money commodity changes, then the ratio of two to one will still hold. It's just that it will be articulated in a different way because the money commodity has changed, and has changed its value. So, he breezes past that kind of question by simply saying, this disappears in the wash.

But, on 192, he brings in a more important issue. This is where he talks about the YMH measure of value and standard of price. money performs two quite different functions. Now as a measure of value, the functions are it's important that it be stable, it's important that it be tangible, not change its qualities. And so you can see immediately as a measure of price why it is that gold… rather than strawberries, is the money commodity. Because gold can store value.

gold is fairly constant in its form, it can be assayed, it can be measured, and there is a limited supply of it, you just can't go out and dig it up in your backyard. So there are reasons why money gravitates towards gold as the measure of value. Because it works very well and even though as we've seen, the value of gold itself can shift, that doesn't materially affect its capacity to function in these ways. As a standard of price, however, what we find is he says that

We're no longer interested in the relationship between the socially necessary labour time in gold and the socially necessary labour time in commodities, because socially necessary labour time is immaterial and immeasurable directly. What we're interested in is the quantity of the gold which is equivalent to whatever it is you're selling as a commodity. And that quantity of gold then tells you how much your commodity is worth.

It's a quantitative relation. Now, why two ounces? Why not one ounce? Why three ounces?

Well, this at some point or other leads into, he says, the way in which the weight name of the money becomes the weight name of the value of the commodity. In this weight name, and he quotes at the top of 194, when he starts to talk about the word pound. Pound was originally a pound of silver. but then it simply became called pound. And so the British currency is in pounds. Now, when you're in Britain and you ask

For pounds, you don't expect somebody to give you a weight of something, you expect them to give you notes. So what he's doing here is to talk about a transition that's going on from the value form which is in the money commodity to This naming and counting of elements of money which are then traded for… by the commodity traders. And this transition, of course, completes the fetishism that he's talked about in an earlier chapter. So, 195 he said,

the name of a thing is entirely external to its nature. I know nothing of a man if I merely know his name is Jacob. In the same way, every trace of the money relation disappears in the money names, pound, thala…

Frank, Ducat, etc. Then he goes on to talk about the confusion caused by attributing a hidden meaning to these kabbalistic signs. is made even greater by the fact that these money names express both the values of commodities and simultaneously aliquot parts of a certain weight of metal, namely the weight of the metal which serves as the standard of money.

On the other hand, it is in fact necessary, again this word necessary, it is necessary that value, as opposed to multifarious objects of the world of commodities, should develop into this form a material, a non-mental one, but also a simple social form." Which leads into the conclusion, price is the money name of the labour objectified in a commodity.

Now, what he's saying here is that, yes indeed we have all of these terms like ducats and louis and dollars and pounds and so on, and we measure… the value of commodities in quantities of those terms, but at some point or other there has to be some relationship between the way These nominal forms of money are articulated and a monetary base, a commodity base. He's saying that's essential. Now of course since the 1970s…

The global economy has not done that very effectively. And so the question then arises is this insistence about the monetary base. the commodity base, the money commodity value. Is his insistence on that realistic? And what happens when you decide that you're going to dispense with it? As has technically happened… since the dematerialization of money that had set in from the 1970s onwards. We'll come back to that later when we look at questions of money supply.

But then the end of this section introduces some rather astonishing modifications in the argument. He says, the magnitude of the value of a commodity, this is towards the bottom of 196, therefore expresses a necessary relation to social labour time which is inherent in the process by which its value is created. With the transformation of the magnitude of value into the price, this necessary relation appears as the exchange ratio between a single commodity

and the money commodity which exists outside it. This relation, however, may express both the magnitude of value of the commodity and the greater or lesser quantity of money for which it can be sold under the given circumstances. This possibility therefore of a quantitative incongruity, note this, quantitative incongruity between price and magnitude of value i.e., the possibility that the price may diverge from the magnitude of value is inherent in the price-form itself. This is not a defect.

is what makes this form the adequate one for a mode of production whose laws can only assert themselves as blindly operating averages between constant irregularities. Now what's going on here? If everything in the market was presented at its value and sold at its value…

then there would be absolutely no way in which you could adjust for demand and supply fluctuations. What's happening here… is that, in effect, on a given day too many traders may come into the market and not enough demanders may come into a market and the price will go down. Less traders will come, more people will come, and the price will go up. So what's happening here is that Marx is talking about the way in which once you go to a price name…

and hang prices on commodities, different prices can be realized in different times and different places. They fluctuate all over the place. And that is what the anarchy of a capitalist market system is about. And the money system has to be able to deal with that. So these incongruities that he's talking about are specifically able to deal with fluctuations in demand and supply conditions.

Now Marx, along with the classical political economists, assumed that at the end of the day, with all these fluctuations, there is something called equilibrium price or natural price. That is, the price which is achieved when demand and supply are in equilibrium. And at that point he says, demand and supply cease to explain anything. It doesn't explain why shirts exchange in a certain ratio with shoes, on average.

It's not that shirts are more in demand than shoes or anything of that kind, on a given day they may fluctuate, but the fact that shirts and shoes have different prices has to do with their socially necessary labour time. the fact on a given day that the price of shoes fluctuates above or below its socially necessary labour time equivalent is due to demand and supply fluctuations.

In order for demand and supply fluctuations to be incorporated into a capitalistic system, we need a money system which can do that. And this quantitative incongruity between

money as a measure of value and the way in which prices get hung on commodities and prices get realized on a given day, on a given market, at a given time. All of that… is allowed for precisely because of this transition that's occurred between money as a clean measure of value to its operating function as a standard of price which can allow these fluctuations.

even more astonishing on the next page is the fact that this transition from money as a measure of value into a standard of price can also harbor, he says, a qualitative contradiction with the result that price ceases altogether to express value, despite the fact that money is nothing but the value form of commodities.

things which in and for themselves are not commodities, things such as conscience, honour, etc., could be offered for sale by their holders, and thus acquire the form of commodities through their price. K-street and all the rest of it. Hence a thing can, formally speaking, have a price without having a value. The expression of price is in this case imaginary, like certain quantities in mathematics.

On the other hand, the imaginary price-form may also conceal a real value relation or one derived from it, as, for instance, the price of uncultivated land which is without value because no human labour is objectified in it. The point about land which has not yet been occupied is that there are ways in which land does incorporate what you might call a shadow price of human labour.

That is, land which is, human labour embodied in it over here, casts a shadow value, if you like, on the land which could be incorporated next year here. So that what Marx is saying here is the case of land is a complicated one. Because although you would see no direct human labour incorporated into that piece of land, you would see what we call externality effects arising from the human labour which is incorporated in all the land around it. If you had a little piece of Manhattan…

and you had had it since Indian times, and kept it pristine and clear and said, no human labour has been incorporated into this, it therefore has zero value. And he went into the market and sold it for zero value. but again what Marx is doing here is to say this qualitative inconsistency also has to be put against the background

That real value has to be produced somewhere. Imagine an economy. which only exists on trading conscience and honour. How would we live? Where would our shirts and shoes and all the rest of it come from? Marx is kind of saying, well…

These qualitative incongruities also have to be put against the question of where is the real value behind all of this? And what is this real value all about? And that is, I think it seems to me, a very pressing question which confronts us when we think about how the global economy is working.

I mean, people like to say the United States, you know, well, the working class, a lot of it has disappeared, so value's not being produced in the United States anymore, but then you've got to think about what's going on in China. And you think about the fact that, actually, even though everybody's now concentrating on making megabucks out of financial operations, the global proletariat has doubled since 1970.

value is still being produced in very traditional kinds of ways, even though it's being distributed in quite other ways. So this is, if you like, the main point he wants to make about this measure of value, standard of price, movement.

which then takes him into the second section, long long section on the means of circulation. Now he starts off… with the following observation. We saw in a former chapter that the exchange of commodities implies contradictory and mutually exclusive conditions. Can anybody remember what those contradictions and mutually exclusive conditions were? He's referring back to the section on the relative and equivalent forms of value. And if you go back to page 148, you'll see he says,

becomes the form of appearance of its opposite value. Concrete labour becomes the form of manifestation of its opposite abstract labour. Private labour becomes a form of manifestation of its opposite social labour, back on 148-151. So he's immediately referring back then to those… tensions between the particularity of the money commodity and its supposed universal capacity to represent.

socially necessary labour time in the global economy. He then makes a very interesting observation, and I highlight it because it's important to grasp Marx's mode of thinking. He says, the further development of the commodity does not abolish these contradictions, but rather provides the form within which they have room to move. This is, in general, the way in which real contradictions are resolved.

In a way, he's describing his dialectical method, that we expand the argument and the contradictions and we see the contradictions having greater… purchase, greater possibility of movement. He then uses an interesting metaphor, for instance, it is a contradiction to depict, one body is constantly falling towards another and at the same time constantly flying away from it.

The ellipse is a form of motion within which this contradiction is both realized and resolved. I'm sure some of you feel Marx's argument is indeed elliptical. but I think his metaphor here is a very important one because, notice, an ellipse is about motion. It's not about stasis, it's about movement. And it's about perpetual movement. perpetual motion. So in a sense what he's doing is he's indeed using this kind of method to expand the general structure of his argument.

So his first gesture then is to set up an argument about what he calls the metamorphosis of commodities. which is again a process of circulation. And here also we start to get a different idea of what the dialectic is about, it's about the study of motion. I've mentioned process a lot. but here we're now looking at circulation, we're looking at motion. And that motion is, as he calls it on 198, social metabolism.

Now he's talked about the metabolic relation to nature, but here he's talking about the social metabolism. And he puts it this way… 199. Exchange produces a differentiation of the commodity into two elements, commodity and money, an external opposition. And further down the page he calls this antagonist and antagonistic form. So we start now to think about the world of commodities on one side and money on the other.

on the other and talk about the relationship between them. And he immediately shifts his argument from a commodity-commodity exchange relation, a cc relation, the Robinson Crusoe economy, to start to look at a CMC commodity, money, commodity circulation. and he sets up then an argument about this form of circulation. One of his big arguments is that inferences you would draw from a commodity-to-commodity relation cannot be applied to the commodity-money-commodity metamorphosis.

The first metamorphosis is, let us look at this piece of the story. Commodities into money. He points out that you're going from the particular to the universal. And going from the particular to the universal, faces a whole range of different problems. You have to find somebody out there who wants your commodity. You've got to fulfill a social need.

tense complications of the social division of labour. Somehow, I have to find somebody in the market who wants my particular commodity and can give me the money equivalent. of my commodity. So this means that the labour expended on the commodity, as he says on page 201, must therefore be of a socially useful kind.

And then he goes on to suggest this, perhaps the commodity is the product of a new kind of labour, and claims to satisfy a newly arisen need, or is even trying to bring forth a new need on its own account. Here he's beginning to talk about the problem of need creation under capitalism. What's going to happen? How does an entrepreneur create a need for a new product?

innovations have other effects." Today the product satisfies a social need, tomorrow it may perhaps be expelled partly or completely from its place by a similar product. What happens in the market, therefore, is a whole set of difficulties have to be overcome before I can convert my commodity into money.

I encounter, and he goes through on 202, the fluctuating demand and supply conditions which is already mentioned. So he then adds, you know, ends up… saying, we see then that commodities are in love with money, but the course of true love never did run smooth. The quantitative articulation of society's productive organism…

by which its scattered elements are integrated into the system of the division of labour, is as haphazard and spontaneous as its qualitative articulation. We're going back now here to the imagery of the hidden hand and the atomistic.

qualities of capitalist production which he is presuming and assuming. As he says, the owners of commodities therefore find out that the same division of labour which turns them into independent private producers, also makes the social process of production and the relations of the individual producers to each other within that process, independent of the producers themselves.

Back again to the Adam Smithian argument. They also find out that the independence of the individuals from each other has its counterpart and supplement a system of all-round material dependence. That is, although you're independent in the market, you're dependent on the market. You have to be able to market your produce. So he then pulls this all together around this phrase which I've already used of a relationship between the particular and the universal on 203.

He then goes to the second component. He says, well let's look at this piece. Here we're going from the universal to the particular. Now clearly what this means, as he says, as he starts out by saying, all commodities are alienable, that is, they can all be bought and sold. And there is therefore a universal alienation in that technical sense of everybody is prepared to give up their commodities, give it away, not give it away but trade it away.

and clearly it is easier to go from the universal to the particular. I command money. I go out into the marketplace, I can buy whatever commodity I want. So the difficulties and the traumas that attach to the commodity-to-money transition are very different. There is, if you like, a different power relation involved here. And that has become crucial to the argument. Those who command the universal equivalent, money, the universal, are in a powerful position vis-à-vis those…

who command commodities. It's a latent power. At the moment we can just see it as a continuing power but you can see… how something can build there. So he then goes to talk and say, this whole process I call the circulation of commodities.

On page 208, he goes into a very significant diversion to the main argument. Miller says, nothing could be more foolish than the dogma. But because every sale is a purchase, and every purchase a sale, The circulation of commodities necessarily implies an equilibrium between sales and purchases." He then goes through an analysis of this argument but makes the point right at the bottom of the page

that no one directly needs to purchase because he has just sold." Then goes on to comment, circulation bursts through all the temporal, spatial… and personal barriers imposed by the direct exchange of products. And it does this by splitting up the direct identity, present in this case, between the exchange of one's own product…

and the acquisition of someone else's into the two antithetical segments of sale and purchase. To say that these mutually independent and antithetical processes form an internal unity… is to say also that their internal unity moves forward through external antitheses. These two processes lack internal independence because they complement each other.

Hence, if the assertion of their external independence proceeds to a certain critical point, their unity violently makes itself felt by producing a crisis. Now what's going on here is this. Marx is arguing that when I've sold a commodity and I've got money, I may decide to hold money. And if I decide to hold money, there's less money to buy commodities. Now, why would I decide to hold money?

hold money in a situation of insecurity. I would hold money because I wanted the universal equivalent, and as later on we'll see some people hold money because they love it, and they fetishize it. All kinds of reasons why people might hold money. But the point here is this, that what Marx is saying is that if a lot of people decide to hold the money…

then the circulation process stops. And if the circulation process stops, the demand for commodities drops off. And if the demand for commodities drops off, then there are a large number of people here with unsold commodities. Furthermore, the fact that you have money gets you away from the immediate temporality and spatiality of barter. You can hold the money for six months. You can take your money to Japan.

or Singapore or Brazil, and go purchase there six months later. Once you've got your money, you can make all kinds of decisions about it.

Now what Marx is criticizing is a famous argument called Say's Law. Say's law says, mentioned in the footnote on the next page, where Marx makes the comment, The conception adopted by Ricardo from the tedious Say that over-production is not possible, or at least that no general glut of the market is possible, is based on the proposition that products are exchanged against products. Say's Law

was also held by Ricardo, and it dominated thinking in classical political economy. And as a result, the classical political economists for the most part said, there can be no general crisis of capitalism. Why not? Because every purchase is a sale and every sale is a purchase, therefore you're always in equilibrium. There may be a problem of too many shoes or too many shirts or too many apples, but you cannot have a generalized crisis.

because Say's Law said you couldn't. And Say's Law actually carried over from the classical period into the neoclassical period. It was held by all economists at the end of the nineteenth century. up until the 1930s. And in the 1930s there were the economists saying, a general crisis of capitalism is impossible. And there you had one.

And Marx has a very funny line about that elsewhere, when he kind of says, you know, when faced with a general crisis, the only response that most of the economists can make is that, well, it wouldn't happen this way if only… the economy worked according to my textbook. But what Marx is saying is that you can have a general crisis. And how you can have that general crisis was spotted by

Keynes. Now what Keynes did in a series of very interesting essays, called Essays in Biography, back in the 1930s, was to point out the error of accepting Say's Law. and pointed out that there were some classical political economists who did not accept Say's law and said there could be a general crisis. At the time they went under the charming name of the general glut theorists. And there were two in particular. One was Malthus.

which is a bit of a problem for Marx because Marx couldn't abide Malthus on other grounds, but Malthus certainly believed there could be a generalized crisis. and the generalized crisis would be a generalized crisis of what is called effective demand. Not enough money to buy all the commodities. was a Frenchman called Sismondi, who disputed Say's law. But they were in a minority. What Keynes did was to point out the importance of what he called the liquidity trap.

The liquidity trap comes because in a time of difficulty people start to hold money. As they hold money… So the difficulties become deeper and deeper and so more and more people hold money. And the difficulty is to get out of this downward spiral. in the economy as more and more people run for cover and hold money rather than investing it, putting it into the market, buying stuff and all the rest of it.

Keynes also talked about the significance of effective demand, and of course Keynesian policies in relationship to the Great Depression were, stimulate effective demand by state expenditures, debt financing, getting people back to work if you could, getting consumptionism back, and of course, a lot of that problem was solved by World War Two, and the demand for armaments and all the rest of it.

So in many ways World War II was the solution to the effective demand problem. You could mop it all up in terms of… armaments and production of armaments and all the rest of it and you would debt finance it, you would even debt finance the British, so you gave them something called lend-lease, that is, they took the commodities and agreed they'd pay later.

And when it came to payment, Keynes was faced with negotiating the repayment schedule, I think in 1944, and the American State Department said, well, you give up the British Empire. And so Cain said, you mean we trade the British Empire for forgiving the debt? And they basically said yes. And that's where British decolonization policy really came from, opening the world market.

was what the Americans wanted for American capital, they wanted the closed system of the British Empire opened up, and they got it through, in a sense, this trading agreement over land-lease.

if you like, the argument which is going on here in Marx. Marx is saying you can get a general crisis, he's siding with Malthus and Sismondi, Keynes is later drawing on this argument, he refuses of course to cite Marx. He said he never read Marx, but actually if you read him carefully it's very doubtful that that's the case. And even if he didn't read Marx, there were plenty of people around him who had.

he knew what Marx was arguing about this sort of thing. Marx is very clear, says law is wrong, cannot be the case, there is a lopsidedness in this relationship, c to m is different from m to c, you cannot as Say's law does, assume that the laws of barter hold an actually equivalent is being exchanged for equivalent. This is a sidebar, but…

A terribly important one, obviously, for understanding contemporary politics. We come back to the circulation of money. What Marx is going to do here is… a set of rather boring maneuvers, if I dare say it, but in a sense what he's saying is this, that the interesting contrast between commodities and money… is that commodities enter into circulation, then I buy them and I wear them or I eat them and they disappear, so commodities enter into circulation and drop out of circulation.

Money, however, stays in circulation, unless people hoard it or are spirited away or something like that. But the general role of money is to stay in the circulation process. Commodity exchange is going on, being produced all of the time, and you have money which is, in a sense, acting as the lubricant of all of this exchange. And the question he's posing here is, how is it a lubricant, and furthermore how much of that lubricant do you need.

ten pages are taken up with is the articulation of what we call the quantity theory of money, which is actually pretty identical to what Ricardo had to say. And he defines the quantity theory first on , where he says, the total quantity of money functioning during a given period is the circulating medium. is determined on the one hand by the sum of the prices of the commodities in circulation." Set that up.

And on the other hand, by the rapidity of alternation of the antithetical processes of circulation, In other words, the movement of prices, the quantity of commodities and the velocity of circulation, the mass of money equals the sum of all the prices of the commodities in circulation, modified by the velocity of circulation. The velocity of circulation is a measure of how much work a coin or a dollar bill does in a given day. How many times does it exchange?

the Federal Reserve still has a key measure, the velocity of money, the velocity of circulation. You can see how important it is, because… When you introduce credit cards, for example, you increase the velocity of circulation. And as you increase the velocity of circulation it means you need less actual money because the amount of money you have

is going to move much faster. If a dollar bill exchanges hands once a day, that's a different kind of world from a situation where a dollar bill changes hands say five times a day. You need far more dollar bills if you only exchange your hands once a day than if it's five times a day. So the amount of money you need is very sensitive then to this measure of the velocity of money.

The Federal Reserve has all kinds of measures of the velocity of money it sets up, and it's a complicated issue of how to measure it. But what Marx is saying is, we have to take this into account. And this was what Ricardo said also, so Marx is not saying much here that is not already available in Ricardo, including the idea that it's the sum of the prices.

This is, if you like, the quantity theory of money which is set up in this section. This then leads him in section c to move to another level, which is to talk about the way in which coins and symbols of value start to take over the functions. And here you will find immediately…

that the weight of gold, he says, represented in the imagination by the prices or money names of the commodities, has to confront these commodities within circulation, as coins or pieces of gold of the same denomination. The business of coining like the establishing of a standard measure of prices, is an attribute proper to the state. State power becomes crucial.

The different national uniforms, worn at home by gold and silver as coins but taken off again when they appear on the world market, demonstrate the separation between the internal or national spheres of commodity circulation and its universal sphere. the world market. This again is something which is going to come back in this chapter about the world market and universal sphere. Out of this arises, he says on page 223, the latent possibility…

of replacing metallic money with tokens made of some material, i.e. symbols. He talks further down, small change appears alongside gold for the payment of fractional parts of the smallest gold coin. Gold constantly enters into retail circulation although it is just as constantly being thrown out again by being exchanged with small change." And then the next page, he talks about

in convertible paper money issued by the state and given forced currency. Issues of paper money. And it is here that for the first time he starts to talk about the way in which credit money…

may take root spontaneously in the function of money as a means of payment." So here we get a replacement going on, the replacement of gold by symbols, by paper, by coins. Why would that occur? Well, because gold is very awkward as a means of circulation, if every time you engage in this transaction…

you need a small grain of gold. It's going to be horribly messy. So indeed, the requirements of circulation, what is socially necessary in order… For this circulation to become general and commodities to be exchanged in a general way, what is socially necessary is that you leave gold behind and start to work with tokens and symbols and paper. and all the rest of it. Paper money, he says, is a symbol of gold, a symbol of money, that's on the bottom of 225.

Its relation to the values of commodities consists only in this. They find imaginary expression in certain quantities of gold, and the same quantities are symbolically and physically represented by the paper. Only in so far as paper money represents gold, which like all other commodities has value, is it a symbol of value.

Now, it's interesting here to think about whether he's again working with a logical argument or a historical argument. He talks about the way in which different forms of money were pushed out as historical evolution. and how important the state power was in regulating what the value of money is about. And in this chapter, the power of the state…

becomes critical. In a way, it was also there in chapter two when he's talking about the legal and juridical infrastructure necessary for market exchange to flourish, which is ultimately going to be a state function. And here he's talking explicitly about the way in which the state becomes critical for understanding how money becomes a symbol, becomes a total… It becomes tokens and all the rest of it.

transformation again, which has this analogy with transformation into a standard of price. This transformation brings about a radical

redefinition of what money is about. And that leads us into the final section, which is three, money. And again, what Marx is arguing here is that at the end of the day there's only one money. and it has to perform both of those functions. How is it going to do that? When we see that as a measure of value gold is fine, as a means of circulation it's not.

As a standard of price, gold starts to fade into the background. The connectivity between the socially necessary labour time embodied in the money commodity… starts to get mediated in all these different ways, and so we start to lose contact with the monetary base. which then leads him to consider a number of elements about the contradictions which get internalized within the money-form itself, universal money.

is the issue of hoarding. He says, when the circulation of commodities first develops, there also develops the necessity… and passionate desire to hold fast to the product of the first metamorphosis. This product is the transformed shape of the commodity, or its gold chrysalis. Commodities are thus sold not in order to buy commodities,

but in order to replace their commodity form by their money form. Instead of being merely a way of mediating the metabolic process, this change of form becomes an end in itself. The money, he says, is petrified into a hoard and the seller of commodities becomes a hoarder of money. What he's beginning to talk about here is another transition. That is, instead of thinking about CMC, we start to think about money into commodities, commodities into money. What the hoarder wants is money.

They want the universal power. But it's interesting, Marx talks about this in this double language. that it exerts a passionate desire. So the passionate desire is there, but then he says it's also necessary. Why is it necessary? Why is hoarding necessary to commodity exchange. The first reason is given at the bottom of 228, and that is…

that when you enter into the market, you enter at a certain time, and you need something in that market, you have to have saved up enough money to go into the market. If you're a farmer… and you've produced your crop and sold your crop in September, you have to hoard the money in order to buy the seeds and the energy and all the rest of it, you need in the spring to plant the crop and all the rest of it, hire the labour and all the rest of it.

So hoarding is something which is implicit in what we would call the time structure of the production of commodities. produced and sold in the same timeframe, you wouldn't need hoarding, but the fact is they're not. Some take a long time to produce, some are produced immediately and consumed immediately. As he says, top of page 229, in this way, hordes of gold and silver of the most various sizes are piled up at all the points of commercial intercourse. And it's necessary that that happen.

With the possibility of keeping hold of the commodity's exchange value, or exchange value as a commodity, the lust for gold awakens. The passion and desire comes in. Gold is a wonderful thing, its owner is master of all he desires. Gold can even enable souls to enter paradise. The papacy in the medieval period was in the habit of selling indulgences.

which guarantees you entry into heaven. And there are some people who maintain that the Vatican was one of the first great capitalistic institutions as a consequence of this. It was selling entry into heaven. I mean, talk about selling conscience and honour, I mean this is selling something really interesting.

Since money, he says, does not reveal what has been transformed into it, everything, commodity or not, is convertible into money. Everything becomes saleable and purchasable. Here he's talking about the potentiality for the commodification of everything. Once you've got the money system, you can hang a price on anything, commodification of everything. And he says, nothing is immune from this alchemy, the bones of the saints cannot withstand it, let alone more delicate things.

Just as in money every qualitative difference between commodities is extinguished, so too for its part as a radical leveller." Again, this is always an interesting theme in Marx, a radical leveller. is reduced to this same metric. Everything has a price. It extinguishes, he says, all distinctions. But money is itself a commodity, an external object.

capable of becoming the private property of any individual. Now this is a reversal of item three in the contradictions, he noted in the relative and equivalent forms of value. Remember, private activity became the means for the representation of universal social labour. Now he's saying, The fact is that private individuals can appropriate social power. Social power can become the property…

of private persons. This is this latent power relation of the money-form and holding the universal equivalent beginning to be crystallized out into the open, and it of course is going to be the basis of class-power. And for this reason, he notes, ancient society therefore denounced it as tending to destroy the economic and moral order. Modern society, which already in its infancy had pulled Pluto by the hair of his head from the bowels of the earth,

greets gold as its holy grail, as the glittering incarnation of its innermost principle of life." It's very interesting. We often talk about money as filthy, filthy lucre. I guess there's a TV show on right now about dirty sexy money or something like that, you know, right? Freud had all kinds of wonderful things to say about money, in the end he called it bourgeois sublimation of rituals of the anus. So there's something unclean about money, something…

not nice about money, and ancient society actually didn't like money economy. Marx in the Grundrisse talks about the way in which one of the big transitions that occurred in the social world was what he called the destruction of community. by money power. So that money became the community. So that we live now in the community of money.

We may have all kinds of fantasies about living communities somewhere else and all that kind of stuff, but we live in the community of money. And Marx is also making very clear… Furthermore, at the bottom of 2-30, he piles on the agony of this by simply pointing out, he talks about the metallic natural form of this object. and as a universal equivalent form of all other commodities, and as a direct social incarnation of all human labour. The hoarding drive, he says, is boundless in its nature.

Qualitatively or formally considered, money is independent of all limits. That is, it is the universal representative of material wealth because it is directly convertible into any other commodity.

He goes on then to talk about this contradiction between the quantitative limitation and the qualitative lack of limitation of money keeps driving the hoarder back to his Sisyphean task. Accumulation. This is the first mention of accumulation. The limitless qualities of it are, I think, fascinating to reflect on. If we're accumulating use values… How many Ferraris can you have? Imelda Marcus had what, six thousand pairs of shoes? But there's a limit. But do billionaires feel they have a limit?

about the next billion? The answer is no. The accumulation of money power is limitless, and therefore what we get into is a form of accumulation that has in principle no external limits. Very important argument. And to the degree that people are into the accumulation of social power… they're into the accumulation of limitless social power. I mean most CEOs in this country are getting, I don't know…

five, ten million in a year or something like that, think of themselves as being underpaid. And if you kind of said to them, well, they kind of said, well, hey, those people in the big, somebody in a hedge fund got 1.7 billion dollars last year, I deserve that. How come they got 1.7 billion and I didn't? And this is the point about the limitlessness of it. Two years ago the top hedge fund earner got 250.

million dollars. This year is 1.7 billion. It's limitless. And Marx is laying down that principle about as soon as you get into money as a universal equivalent. As a representation of socially necessary labour time of value, it is in principle limitless, in terms of what you can accumulate, and in terms of what private persons can accumulate, in terms of their own private power.

over a social good, which is the socially necessary labour time in the world market. So this is what Marx is pointing to here, the limitless qualities of it. and the fact that the accumulation of capital knows no limit. And of course, if you look at every other society that's ever existed in history… you'll find almost invariably they hit limits. And when they hit limits, didn't know where to go, they often collapsed. The one society that seems to be completely limitless is capital.

and so far it has been limitless precisely because its main measure value has this particular form which allows it to be accumulated in this way. And the result is that All of the growth curves in terms of the total money in society, the total wealth of society, the total amount of output in society, the total global gross domestic product in the world, all the rest of it, look at the growth curves since capitalism…

really kicked in in, say, 1750, logistical, whiz like that, with all kinds of social, political, and environmental consequences, of course. which we can worry about. But that is the nature of what capitalism is about. And that is how Marx is setting it up.

Which brings him also to point out, right at the end of this section, that hoarding We made a little aside about the aesthetic form of hoarding, you know, you want to have gold and silver plated urinals or whatever, you know. The function of hoarding

Owing to the continued fluctuations and the extent and rapidity of the circulation of commodities and in their prices, the quantity of money in circulation unceasingly ebbs and flows. This quantity must therefore be capable of expansion and contraction.

and the hoard can fulfill that function. In other words, he's going to modify his theory of money in society by saying, given the fluctuations… The total mass of money you need is the sum of the prices, modified by the velocity, plus a reserve fund. this reserve fund can be brought into circulation when there's a massive surge of commodity production, and taken out of circulation when it is not needed.

But the reserve fund is absolutely crucial to the stabilization of this system. That is, a form of hoarding is necessary.

for those two reasons, the temporality reason and this reason. These are in section B, means of payment. straightaway to means of payment as being a way to approach the need for a hoard given different temporalities. In other words, if we just exchange notes and say, I'll settle up with you at the end of the year, you don't need to actually hoard the money. So, means of payment.

I just write a note and say, okay, I owe you this. The farmer writes a note and says, I owe you this and I'll pay you back at harvest time or whatever. And there come certain dates. where these things tend to be formalized. But the result of this is a transition and here we've got, actually on 233 to 234, an extremely important transition which is very easy to miss.

partly because of the way in which Marx buries it in his usual complicated language. The first element in this, on 233, is this, the seller becomes a creditor, the buyer becomes a debtor. a big transition in relationships between buyer and seller and creditor and debtor. Since the metamorphosis of commodities or the development of their form of value has undergone a change here,

money receives a new function as well, it becomes the means of payment. The role of creditor or of debtor results here from the simple circulation of commodities. Now, it's amazing how much is squeezed out of this concept of the commodity here. The concept of the commodity is giving rise to these new roles of creditor and debtor.

This is capable, he says, of a more rigid crystallization. And he then starts to talk about the class struggle in the ancient world, in which The plebeian debtors were destroyed by the creditors, the struggle in the Middle Ages where the feudal debtors lost their political power… So there's a power relation in this debtor-creditor relation. He then takes us back to the sphere of circulation, and takes us back to the argument earlier.

in which he starts to talk about the way in which money becomes the object of the circulation process. But it now enters it in a peculiar way. The means of payment, he says, enters circulation but only after the commodity has already left it. The money no longer mediates the process, it brings it to an end by emerging independently.

as the absolute form of existence of exchange value, in other words, the universal commodity. The seller turned his commodity into money in order to satisfy some need. the hoarder in order to preserve the monetary form of his commodity, and the indebted purchaser in order to be able to pay. If he does not pay, his goods will be sold compulsorily."

The value form of the commodity has now become the self-sufficient purpose of the sale, owing to a social necessity, springing from conditions of the process of circulation itself. what he's now taken us to is this radical transition from a CMC form of circuit into an MCM form of circuit. If I hold money… I can just lend it to you, and then you pay me back. I don't even have to produce commodities anymore, let you produce the commodities. I just hold the money."

But notice, I want to get that money back. But of course the logical argument here is, why would I get back the same amount I started with? Why would I not insist upon an extra amount of money. That is, the exchange of equivalents makes sense. when I go from commodity to commodity mediated by money, I end up with a commodity at the end which is the same value as the one I started with, in principle. And I'm happy. I started with shirts and I got my shoes.

exchange for equivalent, everything's fine. The equality principle has worked. But why would I start with money just in order to get money? the only reason to do that is to get more money. And so what Marx is beginning to do here is to say, out of this relationship between the commodity and money… there emerges a form of circulation which is the MCM form of circulation, and it arises out of a social necessity.

not because somebody felt it was a good idea, although we've seen here that the passionate interests are very much engaged and the lust for gold and the lust for power is very much engaged, but even if that were not there… you would still need a form of circulation of this kind in order to keep the measure of value and the means of circulation in balance.

That is, the only way you can resolve that contradiction between money as a measure of value and money as a means of circulation is by this form of circulation… which can bring money into exchange when it's needed, and take it out when it's not. So that the money needed, if it's in equilibrium with the commodities being traded…

will keep the measure of value constant. Otherwise the measure of value will start shooting all over the place. So if I want to maintain a constant measure of value… I have to be able to use money as a means of payment, and in doing that I trigger this form of circulation, which is money… focusing on money. This little passage is at the bottom of p.234.

or the middle of 234, is a crucial transition point. And you should mark it and recognize it as a crucial transition point in the whole of Marx's argument. He doesn't actually signal it and say, hey, this is the big transition point, but it is. And the idea that it's a social necessity is also important to him.

Capitalism does not actually depend simply on individuals being greedy and all the rest of it. It depends upon… social necessity piled on social necessity, which allows greed of a certain kind to flourish in certain situations.

This brings him back to talk about a contradiction imminent in the function of money as the means of payment. When the payments balance each other, money functions only nominally, as money of account, as a measure of value. But when actual payments have to be made, money does not come onto the scene as a circulating medium.

in its merely transient form of an intermediary in the social metabolism, but as the individual incarnation of social labour, the independent presence of exchange value, the universal commodity." This leads him on page 236. This contradiction bursts forth in that aspect of an industrial and commercial crisis, which is known as a monetary crisis.

Such a crisis occurs only where the ongoing chain of payments has been fully developed, that is, means of payment and means of payment are just spread around all over the place, credit structures are everywhere kind of engaged. And he says, whenever there is a general disturbance of the mechanism, no matter what its cause, money suddenly and immediately changes over from its merely nominal shape, money of account, into hard cash.

Profane commodities can no longer replace it. The use-value of commodities becomes valueless, and their value vanishes in the face of their own form of value. The bourgeois, drunk with prosperity and arrogantly certain of himself, has just declared that money is a purely imaginary creation. Commodities alone are money, he said. But now the opposite cry resounds over the markets of the world, only money is a commodity.

As the heart pants after fresh water, so pants his soul after money, the only wealth. In a crisis, the antithesis between commodities and their value for money is raised to the level of an absolute contradiction. when he talks about monetary famine. You know, six months ago, if you read the financial press, everybody was talking about excess of liquidity in the markets.

A surplus of liquidity sloshing around, not knowing where to go. Surplus capital everywhere. If you wanted to borrow, you just went and they gave you over anything. You could get subprime loans, you could get whatever you want. And then what happened over the past few weeks, suddenly the Federal Reserve has to inject liquidity into the system. They needed real money. Those houses and all of that didn't actually match up to that value.

In other words, it was fictitious value they were playing with out there. Marx amusingly says somewhere else, you know, at the moment of speculation, Everybody's a Protestant. They act on faith. When the crisis comes they want real money, they go back to the Catholicism of the monetary base. the notion that where is the value right now? Where does it exist? What is all that money which is exchanging in all of these debt-bottling plants we find around ourselves in New York City?

What does it mean? What connectivity does it have to value, to socially necessary labour time? What Marx is pointing to here is the way in which the monetary system, once it escapes from those immediate constraints of socially necessary labour time, can go off and do all kinds of crazy things. And those crazy things…

create all sorts of problems in the global economy. But credit money goes further than that, because on the next couple of pages what he then talks about… He's saying credit money springs directly out of the function of money as a means of payment. Furthermore, credit money becomes the universal material of contracts. Rents, taxes and so on are transformed from payments in kind to payments in money.

the monetization of everything. It used to be the church used to tithe people's agricultural output, then you've got the monetization of… tithes. Get the monetization and commodification of everything. So that What this leads to is this duality. First, a reserve fund becomes necessary, and that reserve fund is going to have to function in relationship to this system via this form.

of MCM circulation. It's the way in which the argument works. But he then says, in the final section on world money, Now, individual states, of course, manage their own money system and money supply and money tokens and all the rest of it. but they're not outside of being disciplined by the world market. That actually the exchange of commodities on the world market at some point or other becomes critical.

to the way in which this monetary system functions. The state has had a very important role to play. in the stabilization of the monetary system within its borders. In so doing, it initially connected… its monetary system very clearly to a metallic base. Gold, silver. And that metallic base became crucial in the construction of the initial financial monetary system. And assuring the security of that metallic base became critical.

It's kind of interesting to note that John Locke wrote his essay on religious tolerance, in which he said, you know, we should tolerate each other in terms of our religious views and we shouldn't go around burning heretics at the stake and all that kind of thing. And he did that at the same time as Sir Isaac Newton became master of the king's mint. And Isaac's great role…

was to assure the quality of the currency, to assay the gold, to assay the weight of the silver. And during those years there was a great trade which led to the debasement of the coinage, which is called coin clipping. What you did was you took a silver coin and you just shaved off a bit of it. And you took a lot of silver coins and you shaved off…

Lots. And by the end of the day you had another silver coin. Good way to make money. So what did Isaac Newton do? He caught a few of these people and you had them hung on Tyburn. in public, so you didn't burn people at the stake for their religious views, you now hung them in Tyburn because they debased the coinage. God is displaced by maimon, in terms of capital punishment.

So this business then comes back to the issue which I'm sure is bothering many of you, which is, well, there was a metallic base to global capitalism up until… the late 1960s, early 1970s. It was put under great stress in the late 60s, early 1970s, and ultimately it collapsed. so that by 1973 you have a global system which is no longer based on any metallic commodity.

You will notice, however, that gold is still important. Gold price is still quoted. And if push comes to shove, you might well ask yourself, do you want to hold gold Or do you want to hold dollars or euros or yen or whatever, you know, you might want to think about that. So gold has not entirely disappeared from the monetary scene at all. Many people still…

and there are still arguments made saying we should go back to the gold standard because the current monetary system is just crazy. But what in effect happened in 1973 and onwards? was a tendency to associate currencies with a particular basket of commodities. For a while there we sat with the idea that petrodollars would work. that actually it was the dollar value of petroleum which was the crucial issue. But then petroleum was yo-yoing too much around the place, in any case…

the value was too much controlled by OPEC. So in effect, however, what now happens is that currency speculation… actually looks at a lot of the time the relationship between the productivity of a whole economy, the total bundle of goods and services produced in that economy, and the value of its currency.

and it compares the total commodity output of Japan and West Germany, as it was, and now Europe, and the United States and China, it compares all of these things and says, well… which economy is producing a bundle of commodities inside of it that can really sustain that currency?

And if the Chinese are doing it then the Chinese currency should appreciate. But the problem then is that the state steps in and does all kinds of strange things and stops that. But at some point or other the question of the commodity bundle which underlies the value. In other words, we no longer attach it to some single commodity like gold, we attach it…

to an imaginary understanding, which is where statistics come in. We wouldn't know how to work in this world unless we had masses of statistics. And what are the statistics about? GDP. Who produces all those statistics and collects them all together, the World Bank and the International Bank of Settlements? They produce all this data. vast amounts of it, on the basis of what sometimes you wonder, but nevertheless it's there. And this data constructs a fiction that there's a national economy.

Now this is a real problem because there is no national economy, I mean everything is trading with everything else on the global stage, but there is a fiction that there is a national economy. and the national economy of the United States is doing well, therefore the dollar will rise. It's doing badly, therefore the dollar will collapse." So the dollar has been under a lot of pressure because the US economy has not been doing very well compared to the rest of the world.

on certain measures. But then a speculator will come in and say that's the wrong measure. And if they can persuade you that's the wrong measure then the values will change and they'll make a bundle on the currency movement. George Soros made, what was it, two billion in about five days, speculating on the value of the British pound against the European exchange rate mechanism.

and was actually able to force those kinds of things. So here you see that what Marx has built into this argument is, I think, a very interesting way in which to understand how this connectivity between the very secure kind of money commodity called gold, which started his analysis of money, to this

real problematic universal money at the end, with all of these broader kinds of things, I think he did a pretty good job. And we can build on it. I mean, things have changed a great deal since he was writing, of course.

and we have to take those transformations very much into account. But, it seems to me he set up an argument which is very useful to contemplate. in terms of understanding our current situation. That is, building on this we can go quite a way, I think, to understand many of the contradictions which exist within a contemporary. political-economic system. And it's so interesting, you know, that something like the subprime mortgage crisis…

Coming from my background in all of this, it's been obvious to me there's going to be a crash in property markets, sooner or later. I thought it was going to occur about two or three years ago, but they managed to stave it off, but now it's sort of with us and the question is how far is that going to go? before they can shift to something else, some other fictitious form. But behind this, of course, lies the emergence of imaginary forms.

Notice how Marx emphasizes that, imaginary qualities of this. We imagine it to be this and we imagine it to be that. And we cannot do without that imaginary stuff going on. In fact, that is what allows the system to function. It's built into it. It's not as if we can say, get rid of all the fetishism, get rid of all of that imaginary stuff and then we'll be okay. No, we couldn't do that.

these things are socially necessary, they're embedded within the capitalist system. Then that raises the question, well, what do we do about it, how do we confront them, and what do we do about their obvious problematic consequences. So these are the sorts of issues that this chapter raises. Final point about this chapter. It's an interesting question as to how much of this chapter you really need to understand the rest of volume one of Capital. And the answer is, not much. The rest of Capital

uses certain basic propositions out of here, which can be reduced to four or five, and then goes on with the analysis. But what he was trying to do here was to lay a basis… as he was in the preceding chapters, for the magnum opus, that is, the work that was going to include an understanding of the credit systems of financial institutions and structures and state interventions and all the rest of it, that is,

He's really trying here to lay out a systematic basis for a very much broader project. But you'll be happy to know. But you don't have to thoroughly understand all the nuances of this chapter, interesting though it really is, and fascinating though it really is, and very important, I think, for our contemporary circumstances. You don't have to understand every nuance of it in order to get on to…

the next chapters which are much simpler and much more direct. So you're over the worst of it. We can now start the easy part. We have about a few minutes for questions. I'm sorry I've taken so long but this is a difficult chapter, intricate chapter, and it's one that needs a lot of elaboration in order to get it straight.

Any kind of comments, questions? Yeah. An anecdote when you're talking about accumulation of things and where's an upper limit. I went to visit Yankee Candle. just to see what that was all about. And next to it had opened a car museum, a very large car museum vest. And I walked around and I realized they all seemed to have a personal ankle on the display cases and the descriptions.

It turned out it was the vast personal collection of the owner of and founder of Yankee Candle. It was just a garage so large that it was now a museum. He paid to go in, but he drove them in and out whenever he wanted, and there's no limit. not the same as what you could get with twenty billion dollars. And that's the point, people do accumulate large quantities of things like that, but…

How many yachts can you have? How many residences can you have? On the use-value side there are these limitations, and it's the limitless capacity of… The accumulation of money power is going to be very important to look at, which is one of the major propositions of course in the rest of capital, the limitlessness of this. I was curious about paper money, when paper money first started showing up. I guess when I'm thinking about what you were saying in terms of historical or logical.

Well, scrip and things like that have been around for a very long time in various forms, so paper representations of this and tokens and so on have been around for a long time, which goes back to my original argument about the monetary form that… Monetary forms have been around a very long time. The interesting question is, how do all of those forms become actually assembled around the capitalist definition of what is money? The same thing applies to temporality.

It's not as if capitalism invented temporality. Every society has its own definitions of temporality and spatiality and all the rest of it, and there's a long history in the anthropological and historical… a record of that, but what happens is that capitalism starts to insist upon certain definitions of temporality, certain definitions of, you know, and for instance we're in one right now, it's 8.30 and you all want to go home.

Now, if you were really interested in learning, you'd want to stay here till five in the morning, right? You know, you're being very nice, but you see what I mean. Here we have this kind of definition of temporality, which is in the school calendar and everything else, you know, we start in, we finish there, it's all sort of built in. And we accept it as normal, it becomes normalized, you know.

Whereas I can certainly remember intellectual discussions in my youth, when all things were wonderful, which went on all day and all night. and we're not limited by anything. We skipped classes, I'm not encouraging you to do that, but skipped classes and then had a discussion instead. It was a different notion of temporality. The problem was there was nothing else to do and the classes were very boring and all the rest of it. So I think these definitions are…

are contingent, and this is again what Marx is arguing right the way throughout, that the categories of political economy are contingent upon the rise of capitalism. The notion of temporality is specific. capitalism has a specific temporality, which is what E.P. Thompson is talking about. The rise of industrial work discipline, and what that was about, and how that was enforced. And we'll see some of that coming up.

very much in Marx's capital too. Okay, so we'll leave it there and we'll continue this saga next week.