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The Pamphlet Collection of Sir Robert Stout: Volume 73

What, then, is Money?

What, then, is Money?

It is simply the stamp of the sovereign power, authorised by Act of Parliament, and declared to be good for payment of debts and taxes. That is what is called legal money, or legal tender. It is the stamp alone in which virtue resides, not the substance on which the stamp is put; it is the fiat of Parliament—let the stamp be money and it is money. There can be no other lawful money, no matter how valuable a substance one may attempt to use as money. The stamp may be put upon gold, silver, copper, leather, or paper. They are all effective as money provided they are duly stamped. The substance on which the stamp is put is only valuable just as any other substance is valuable—that is to say, it may or it may not sell well in the market.

Some writers on money endeavor to show that gold money is better than other kinds of money, because the metal is valuable, being com- page 4 paratively rare, and a country using it is therefore, they say, not so likely to be flooded with inferior money, A gold standard of payment would prevent that, they say. Since 1816, when payments in gold only became law, we have been so constantly told on the Platform and by the Press that gold money is the only "honest money" that one hardly dare say the contrary or doubt the statement. In America you may even hear of gold money being so good that it is called God's money. You may be satisfied of the fallacy of such a statement, but—like Galileo, when threatened with death because he would not retract his assertion that the earth travels round the sun and not the sun round the earth—you may find it uncanny to persist, and may feel under compulsion to accept the statement although not satisfied. It might affect your interests or your pocket to argue the point. But Galileo, you will remember, when he left his tormentors after retracting, said it was true nevertheless. And perhaps you will think with me, before I am done, that we can have honest money without gold; that it is a mistake, and far worse than a mistake, to base our currency on a fluctuating standard like gold; and if you are convinced I trust you will not hesitate to act upon your convictions.