VIII.: Difference betwixt money and mere bullion, farther illustrated.

26. Foreign commerce, as hath been before observed, treats gold and silver as commodities, both alike; and they are subject to fluctuate in their value, not only with respect to one another, but also with respect to all other commodities, according to their greater plenty or scarcity. But nevertheless, in all home establishments and transactions whatsoever, one of these metals is money, or a standard measure of the values of all other things; and this standard cannot be altered, without incurring all the mischiefs before enumerated.

As bullion occurs much more than coin, in the transactions of merchants; some of them have been induced from thence to think, that the price of bullion is what governs and measures, the values of all other things. But, from what hath been already delivered, it is very manifest, that the price of bullion is governed as well as measured, by coin or the established standard of money; and not suffered to deviate much, from that standard. With merchants indeed, any commodity they deal in, may be said indifferently to be a standard for all the rest, as well as gold or silver; for they consider all things, as they will purchase more or less of each the other, in this place or in that; and coins, which with the rest of the world is money, is with them thrown into the general hotch-potch, and no otherwise distinguished from other commodities, but from the proportion that certain quantities of one or the other, will fetch of the rest; and they join with us rather in language than in idea, as to the use of coins. No wonder then, if these gentlemen treat the standard of money so slightly, and so disdainfully, as some of them do. But although we are all agreed, that gold and silver, like all other things, have their values increased or depreciated, according as they grow scarcer or in greater plenty; and that the coins made of them, do, in this sense, share the same fate with the bullion: Yet coins as such, or as money, escape the fluctuations of markets; and the standard coins, which are the measures of all contracts, are to be considered as having their value remaining permanent and unalterable; the above slow alteration brought about by time in the value of money, being not to be admitted into consideration, in the temporary dealings of men with one another.

Having thus explained, as clearly as I could, the several causes of the different prices of coin and bullion; the essential differences there is between them; and also the effect which the over-rating of gold hath upon silver bullion: Let us now proceed to consider, the several pretences that are urged for debasing the standard of money.