f anybody who had anything to sell. In
the matter of durability, their power to resist wear and tear was
obviously much greater than that of the hides and tobacco and other
commodities then fulfilling the functions of currency in primitive
communities. They could also be carried about much more conveniently
than the cattle which have been believed to have fulfilled the
functions of currency in certain places, and they were capable of
sub-division without any impairing of their value, that is to say, of
their acceptability. Merely as currency, precious metals thus have
advantages over any other commodity that can be thought of for this
purpose.

So far, however, we have only considered the needs of man for
currency; that is to say, for a medium of exchange for the time
being. It is obvious, however, that any commodity which fulfils this
function, that is to say, is normally taken in payment in the exchange
of commodities and services, also necessarily acquires a still more
important duty, that is, it becomes a standard of value, and it is on
the alleged failure of gold to meet the requirements of the standard
of value that the present attack upon it is based. On this point the
defenders of the gold standard will find a good deal of difficulty in
discovering anything but a negative defence. The ideal standard of
value is one which does not vary, and it cannot be contended that
gold from this point of view has shown any approach to perfection in
fulfilling this function. It could only do so if the supply of it
available as currency could by some miracle be kept in constant
relation with, the supply of all other commodities and services that
are being produced by mankind. That it should be constant with each
one of them is, of course, obviously impossible, since the rate at
which, for example, wheat and pig-iron are being produced necessarily
varies from time to time as compared with one another. Variations in
the price of wheat and pig-iron are thus inevitable, but it can at
least be claimed by idealists in currency matters that some form of
currency might possibly be devised, the amount of which might always
be in agreement with the amount of the total output of saleable goods,
in the widest sense of the word, that is being created for man's use.

It need not be said that this desirability of a constant agreement
between the volume of currency and the volume of goods coming forward
for exchange is based on what is calle