256 Mr. Faraday on 



money. His realisation is ready made." And again : "The 

 producer of any kind of merchandise is not always able to 

 dispose of it. The market may be glutted. There may be 

 no outlet. Things happen quite otherwise with the producer 

 of gold. Whatever the quantity produced, the gold has a 

 full right to enter into circulation. All the grammes of new 

 gold are exactly equal to all the grammes of old gold. All 

 have the same power. The old metal cannot bar the way 

 to the new metal." 



It is sometimes argued that each party to an exchange 

 is at the same time both a buyer and a seller. But we know 

 that, in practice, the real buyer, the man in possession of legal 

 tender money, has a balance of advantages over the man 

 with commodities which are not legal tender, and if the 

 number of the selling-class is increased, the greater is his 

 advantage. As I have already pointed out, it is in conse- 

 quence of this fact that credit money fails to act as a 

 permanent check on any arbitrary -increase in the buying 

 power of gold money ; because the holder of credit-money 

 sooner or later becomes a seller of his demonetised commo- 

 dities. In much the same way the demonetisation of silver 

 has increased the number of sellers proportionately to 

 buyers, and has thus brought about the greater part of that 

 depression of prices which Sir Thomas Farrer supposes to 

 be entirely due to other causes. Prior to 1873, the Lanca- 

 shire shipper of goods to the East really became added to 

 the buying class the instant he had sold his goods for silver, 

 which was practically international money equally with 

 gold, in consequence of the operation of the French bi- 

 metallic monetary law. At the present time, after selling 

 his goods for silver, he becomes a mere seller of silver. 

 Thus he appears as a seller twice over, the number 

 of the transactions against gold being proportionately 

 increased. The equation is thus enormously disturbed. It 

 has been strangely overlooked that the depression of the 



