in mind, and watch as it goes through its
transformations, does its final work, and perishes. The brilliant
studies of Professor Boehm-Bawerk are based on the idea that such a
tracing of the biography of a particular instrument is the true way to
solve the problem of interest. Yet the very term _interest_ itself
suggests the existence of what we have defined as permanent
capital--an abiding fund or sum of wealth that every year yields as an
income a certain percentage of itself. The "hundred dollars" yields
five dollars; that is, the fund yields a twentieth of the amount
which, amid all the changes of its constituent parts, it continues to
embody. It is true, indeed, that a study of _all_ capital goods which
have existed or will exist, with due attention to their relations to
each other, would reveal the fact that they maintain such an endless
procession as has been here described, and it would thus bring before
the mind such a concept of capital as the business man has and
describes by the monetary form of expression. By making a synthetic
study of capital goods in general, and not separate studies of
particular goods as they come and go, we can obtain a grand resultant
of the action of all of them, which is nothing less than permanent
capital doing its continuous work. Such a comprehensive study of
capital goods, if it is carried far enough, becomes a study of the
abiding entity, capital. Allowing ourselves, however, to put the
abiding entity out of sight and merely to trace the origin, growth,
and productive action of separate instruments of production would be
disastrous. The undying body in which the particular things are
tissues absolutely needs to come into view. The very mention of a
problem of interest--of the percentage of itself that a fund of a
given amount can annually earn--puts before us at once the permanent
entity, capital, and the problems relating to it.[3]

[3] Consumers' goods may be regarded in the two distinct
ways in which it is necessary to regard capital goods. We may
look at particular articles for consumption, as they begin
their careers by ministering to their owners' needs, and
follow them as they wear out and finally perish. This gives a
conception of them which is analogous to the conception of
capital goods rather than to that of capital. On the other
hand, we may look at the permanent stock of usable articles,
which is maintained by the constant comi