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only get half as much, but there is nothing to prevent 
him issuing twice as much in the second month, four 
times as much in the third, eight times in the fourth, 
and so on, and then he will be able to go on acquiring 
the same amount of commodities per month in- 
definitely. Experience seems to show that the unit 
of a currency falls to zero in value long before the 
supply of the currency reaches infinity, and believers 
in the doctrine have been unable to explain why. 
They have contented themselves with eluding the 
point by means of propositions such as, “however 
many units of currency may be issued, so long as 
they really circulate, they will always have some 
value, however small.” No doubt; but is it not 
equally true that so long as they have some value 
they will continue to circulate ? They will stop 
sirculating when they lose all value. The explanation 
seems to lie in the fact that human intelligence 
anticipates what is coming. When it is seen that 
the value of currency is steadily falling, people see 
that it is more profitable to hold goods than currency, 
the demand for currency fails to extend in proportion 
to the enlargement of the supply, and its value 
consequently falls more rapidly. The issuer very 
likely redoubles his efforts to keep up with the fall 
by issuing new currency at a still more rapidly 
increasing rate, but all to no purpose—he is bound 
to lose the race, and the reason is that the elasticity 
of demand is less than unity. 
In the converse case, that of reduction in the supply 
of currency, there is also reason to expect an elasticity 
less than unity. As general prices fall owing to the 
reduction, people will endeavour to protect themselves 
by displaying greater readiness to part with goods 
and services, and less to part with currency, and 
anticipation will thus cause the fall of general prices 
to outrun the diminution of currency. - Pushed to