Grundrisse der Kritik der politischen Oekonomie (Rohentwurf). 1857-1858, Moscow, 1939 [M] II. CHAPTER ON MONEY[23]
"All the trouble derives from the predominance of the precious metals which is obstinately being preserved in circulation and exchange" (pp. 1, 2).a24
Begins with the measures taken by the Banque de France in October 1855
"to remedy the progressive diminution of its cash reserves" (p. 2). Wants to give us a statistical tableau of the position of the Bank in the five months preceding its measures taken in October. For this purpose, he compares the size of its bullion reserves in each of these five months with the "fluctuations in its portfolio", i.e. the amount of its DISCOUNTS (the commercial papers, bills of exchange in its portfolio). According to Darimon, the figure expressing the value of the SECURITIES held by the Bank
"represents the greater or lesser need which the public feels for its services, or, which amounts to the same, the requirements of circulation" (p. 2).
Which amounts to the same? Not at all. If the amount of the BILLS presented for DISCOUNT were identical with the "requirements of circulation", strictly speaking of money circulation, the circulation of notes [its volume] would be determined by the amount of the bills of exchange discounted. But these movements, so far from being on average proportional to each other, often bear an inverse relationship. The amount of the bills of exchange discounted and its fluctuations express the requirements of credit, while the amount of money in circulation depends on quite different factors. In order to arrive at any conclusion about circulation, Darimon ought first to have compiled a column for the amount of notes in circulation, alongside the column for the bullion reserves and that for bills discounted.
In order to discuss the requirements of circulation, it was surely necessary to establish first of all the fluctuations in actual circulation. The omission of this necessary term of the comparison betrays at once amateurish incompetence and deliberate confusion of the requirements of credit with those of money circulation — a confusion upon which the entire secret of Proudhonian wisdom is in fact based. (As if in a mortality table illnesses figured on one side and deaths on the other, while births were overlooked.)
Darimon's two columns (see p. 3), that for the bullion reserves of the Bank from April to September on the one side and that for the changes in its portfolio on the other, express nothing but the tautological fact, which needs no display of statistical illustrations, that in proportion as bills were brought to the Bank to withdraw bullion from it, its portfolio became filled with bills and its vaults emptied of bullion. And even this tautology, which Darimon seeks to demonstrate with his table, is not directly expressed in it. It shows rather that from 12 April to 13 September 1855 the bullion reserves of the Bank fell by about 144 million [francs], while the commercial papers in its portfolio rose by about 101 million.(1) The decline in the bullion reserves therefore exceeded by 43 million the increase in the commercial papers discounted. The identity of the two movements founders on this total result of the movement over five months.
A more precise comparison of the figures reveals other discrepancies.[25]
Bullion reserves in the Bank Bills discounted by the Bank 12 April 432,614,797 frs 322,904,313 10 May 420,914,028 310,744,925
In other words, between 12 April and 10 May, the bullion reserves fell by 11,700,769, while the volume of SECURITIES increased by 12,159,388; i.e. the increase in SECURITIES exceeded by about half a million francs (458,619 frs) the decline in the bullion reserves. An analogous discrepancy, but to a much more surprising degree,
Endnotes
[23] This chapter was first published — in German, with a parallel Russian translation — in the collection Marx-Engels Archives, Vol. IV, Moscow, 1935. Excerpts from the chapter appeared in English for the first time in Marx's Grundrisse by David McLellan, Macmillan Press Ltd., London, 1971, pp. 59-64, 65-69 and 70-73. The chapter was first published in English in full in Karl Marx, Grundrisse. Translated with a Foreword by Martin Nicolaus, London, 1973, pp. 115-238.—51
[25] In the manuscript, Marx rounds off the figures cited by Darimon (the latter gives the number of centimes as well as of francs). However, some of the approximations are not quite accurate.— 52