MOJsEY. 59 



tions already given*, that we go altogether farther than we are 

 warranted when we affirm that the creation of an immense mass of 

 mutual money would produce no depreciation in the price of the sil- 

 ver dollar. The difficulty experienced in understanding this matter 

 results from incorrect notions respecting the standard of value, the 

 measure of value, and the nature of money. This may be made 

 evident by illustration. The yard is a measure of length; and a 

 piece of wood, or a rod of glass or metal, is a corresponding stand- 

 ard of length. The yard, or measure, being ideal, is unvarying; but 

 all the standards we have mentioned contract or expand by heat or 

 cold, so that they vary (to an almost imperceptible degree, perhaps) 

 at every moment. It is almost impossible to measure off a yard, or 

 any other given length, with mathematical accuracy. The meas- 

 ure of value is the dollar; the standard of value, as fixed by law, is 

 silver or gold at a certain degree of fineness. Corn, land, or any 

 other merchantable commodity might serve as a standard of value, 

 but silver and gold form a more perfect standard, on account of 

 their being less liable to variation; and they have accordingly been 

 adopted, by the common consent of all nations, to serve as such. 

 The dollar, as simple measure of value, has— like the yard, which is 

 a measure of length— an ideal existence only. In Naples, the ducat 

 is the measure of value; but the Neapolitans have no specific coin 

 of that denomination. Now, it is evident that the bill of a Mutual 

 Bank is like a note of hand, or like an ordinary bank bill, neither a 

 measure, nor a standard of value. It is (1) not a measure; for, un- 

 like all measures, it has an actual, and not a merely ideal existence. 

 The bill of a Mutual Bank, being receivable in lieu of a specified 

 number of silver dollars presupposes the existence of the silver dol- 

 lar as measure of value, and acknowledges itself as amenable to 

 that measure. The silver dollar differs from a bill of a Mutual 

 Bank receivable in lieu of a silver dollar, as the measure differs 

 from the thing measured. The bill of a Mutual Bank is (2) not a 

 standard of value, because it has in itself no intrinsic value, like 

 silver and gold; its value being legal, and not actual. A stick has 

 actual length, and therefore may serve as a standard of length; 

 silver has actual intrinsic value, and may therefore serve as a 

 standard of value; but the bill of a Mutual Bank, having a legal 

 value only, and not an actual one, cannot serve as a standard of 

 value, but is referred, on the contrary, to silver and gold as that 

 standard, without which it would itself be utterly unintelligible. 



If ordinary bank bills represented specie actually existing in 

 the vaults of the banks, no mere issue or withdrawal of them 

 could effect a fall or rise in the value of money; for every issue of a 

 dollar-bill would correspond to the locking up of a specie dollar in 



♦Perhaps on account of those explanations. As hc:it melts wax, and 

 hardens clay, so the same general principles, as applied to merchandise 

 money and to mutual money, give opposite results. 



