Just as commodity-owners presented the products of individual labour as products of social labour,by transforming a thing,i.e.,gold,into the direct embodiment of labour-time in general and therefore into money,so now their own universal movement by which they bring about the exchange of the material elements of their labour confronts them as the specific movement of a thing,i.e.,as the circulation of gold.The social movement is for the commodity owners on the one hand an external necessity and on the other merely a formal intermediary process enabling each individual to obtain different use-values of the same total value as that of the commodities which he has thrown into circulation.The commodity begins to function as a use-value when it leaves the sphere of circulation,whereas the use-value of money as a means of circulation consists in its very circulation.The movement of the commodity in the sphere of circulation is only an insignificant factor,whereas perpetual rotation within this sphere becomes the function of money.The specific function which it fulfils within circulation gives money as the medium of circulation a new and distinctive aspect,which now has to be analysed in more detail.
First of all,it is evident that the circulation of money is an infinitely divided movement,for it reflects the infinite fragmentation of the process of circulation into purchases and sales,and the complete separation of the complementary phases of the metamorphosis of commodities.It is true that a recurrent movement,real circular motion,takes place in the small circuits of money in which the point of departure and the point of return are identical;but in the first place,there are as many points of departure as there are commodities,and their indefinite multitude balks any attempt to check,measure and compute these circuits.The time which passes between the departure from and the return to the starting point is equally uncertain.
It is,moreover,quite irrelevant whether or not such a circuit is described in a particular case.No economic fact is more widely known than that somebody may spend money without receiving it back.Money starts its circuit from an endless multitude of points and returns to an endless multitude of points,but the coincidence of the point of departure and the point of return is fortuitous,because the movement C --M --C does not necessarily imply that the buyer becomes a seller again.It would be even less correct to depict the circulation of money as a movement which radiates from one centre to all points of the periphery and returns from all the peripheral points to the same centre.The so-called circuit of money,as people imagine it,simply amounts to the fact that the appearance of money and its disappearance,its perpetual movement from one place to another,is everywhere visible.
When considering a more advanced form of money used to mediate circulation,e.g.,bank-notes,we shall find that the conditions governing the issue of money determine also its reflux.But as regards simple money circulation it is a matter of chance whether a particular buyer becomes a seller once again.Where actual circular motions are taking place continuously in the sphere of simple money circulation,they merely reflect the more fundamental processes of production,for instance,with the money which the manufacturer receives from his banker on Friday he pays his workers on Saturday,they immediately hand over the larger part of it to retailers,etc.,and the latter return it to the banker on Monday.
We have seen that money simultaneously realises a given sum of prices comprising the motley purchases and sales which coexist in space,and that it changes places with each commodity only once.But,on the other hand,in so far as the movements of complete metamorphoses of commodities and the concatenation of these metamorphoses are reflected in the movement of money,the same coin realises the prices of various commodities and thus makes a larger or smaller number of circuits.Hence,if we consider the process of circulation in a country during a definite period,for instance a day,then the amount of gold required for the realisation of prices and accordingly for the circulation of commodities is determined by two factors:
on the one hand,the sum total of prices and,on the other hand,the average number of circuits which the individual gold coins make.The number of circuits or the velocity of money circulation is in its turn determined by,or simply reflects,the average velocity of the commodities passing through the various phases of their metamorphosis,the speed with which the metamorphoses constituting a chain follow one another,and the speed with which new commodities are thrown into circulation to replace those that have completed their metamorphosis.Whereas during the determination of prices the exchange-value of all commodities is nominally turned into a quantity of gold of the same value and in the two separate transactions,M --C and C --M,the same value exists twice,on the one hand in the shape of commodities and on the other in the form of gold;yet gold as a medium of circulation is determined not by its isolated relation to individual static commodities,but by its dynamic existence in the fluid world of commodities.The function of gold is to represent the transformation of commodities by its changes of place,in other words to indicate the speed of their transformation by the speed with which it moves from one point to another.Its function in the process as a whole thus determines the actual amount of gold in circulation,or the actual quantity which circulates.
Commodity circulation is the prerequisite of money circulation;money,moreover,circulates commodities which have prices,that is commodities which have already been equated nominally with definite quantities of gold.
