Bo 
MONEY 
dities and issuing more notes when they fell and 
fewer when they rose. This is, however, the very last 
thing that in practice issuers, in the present state of 
economic instruction, are likely to do. They usually 
begin by adopting the exactly opposite principle 
because, incredible as it will appear to future ages, 
they think ‘when prices are high, more currency 
is required.” Turn this round, express it in another 
way, and you have “ when the value of currency 
is low more of it is required *’ and currency is thus 
made a striking exception to the general rule that the 
falling value of an article indicates that additional 
supply of it is becoming less required. It is of course 
no exception at all. When money is reckoned in 
gold and more gold is produced, the value of money 
falls (general prices rise) and this indicates that 
additional supply of gold is less required: when 
money is reckoned in notes and more notes are 
produced, the value of money falls (general prices 
rise) and this indicates that additional supply of 
notes is less required. 
When more coal is produced, the value of coal 
falls, and this indicates that additional supply of coal 
is less required. Of course, if the coal-producers or 
the gold-producers accept a lower price for their 
product, they will find, down to a very low limit, plenty 
of “genuine demand ” for it, but only because the 
demand has extended to take advantage of the lower 
price, and so it is with the note-producers: if they 
will accept smaller quantities of commodities and 
services in exchange for their notes, they will find 
down to a very low limit plenty of genuine demand 
for them, because they are cheaper. The only 
difference between coal and gold and notes is that 
coal is never money, while gold sometimes is, and 
notes always are : in consequence of which the value 
required in exchange for coal is always called its