Financial Legislation and its Limitations. 37 



them, as much as persons who have gold want to hold on to it. 

 In a little while, the very cheapening of goods anticipates the 

 gain that is to be derived from hoarding, so that the latter no 

 longer offers a profitable alternative. The future rise in gold is 

 soon anticipated. A very moderate amount taken out of circula- 

 tion tends to throw prices down to a point where all of the ex- 

 pected gain is anticipated.^^ The moral questions involved in 

 the relation of debtor and creditor are as easily presented for dis- 

 cussion on one as another of the hypotheses as to the causes of 

 price fluctuation. It is little wonder, then, that the wrong but 

 tangible hypothesis of a metallic cause has usually been assumed. 

 § 6. From the dawn of history credit has been circulated.^"* 

 Bills of exchange have always been employed between highly 

 developed commercial states and probably at earlier epochs than 

 generally supposed. Nevertheless, for domestic exchanges, the Evolution 

 world relied more in early periods upon money, since goods were mat^dai!^ 

 not so generally manufactured under definite contracts as they 

 are now. As time went on, more and more valuable money 

 material was used, because more goods were to be exchanged. 

 The market was widening. Primitive people used hides, cattle, 

 tea, salt in pressed cubes ; the Romans advanced to iron, copper, 

 and silver; but it is not until modern times that gold has been 

 used as the standard of value. Silver has been the legal means 

 of payment, until within this century, throughout all the more 

 civilized history of mankind. That fact has naturally furnished 

 one of the chief arguments of bimetallists : that the introduction 

 of gold has been something very recent, and was the result of a 

 conspiracy. To say that it was class legislation might not be so 

 far amiss, since most legislation arises in that way. But all class 

 legislation is not necessarily bad. The fact is, probably, that the 

 use of gold has come in because the merchandise values and the 

 contracts to be dealt in have become so large ; and because, again, 



** Fisher, op. cit., ch. VI. 



"As to the antiquity of the recognized credit documents, copies of 

 Egyptian-Hebrew contracts, bills of indebtedness, bills of sale are to be 

 found in Sachan, Publication der GeneraJverwaltung der koniglichen Mtiseen 

 (Berlin), Leipzig, 1911. These instruments belong to the fifth century B. C. 



151 



