value exactly
equivalent to what was borrowed sixty days or a year previous, when the
ratio of gold to average prices was different. In this way it is supposed
that natural fluctuations in gold, silver or any other commodity made
legal tender for debt can be fully provided for without loss to either
debtor or creditor.

The objections to this ideal standard are the practical difficulty of
settling, first, the wide range of commodities to serve as the basis;
second, the importance to be given each in adjusting the standard; and
third, the nature of the commission under which the work should be done.
In the history of the world, custom has preceded law in devising for
welfare; in this, law without experience will have to precede custom. The
difficulty which most men would experience in understanding and trusting
such a system puts off indefinitely the possibility of a general adoption.

_The currency._--The last essential in perfect freedom of exchange is a
satisfactory means of transferring completely and quickly all property
right in any article of trade. Exchange of commodity for commodity or
service for service is possible to a very limited extent, since the man
who wants my horse may have nothing which I want in return, or if he has,
the values may be unequal, and one or the other must remain in debt, which
means that one of the articles belongs in part to both. In some new
countries exchanges are confined to this slow and uncertain method of
barter, where nobody can buy until he finds a neighbor wanting just what
he himself has to sell. Traders in such countries contrive to accumulate a
variety of things needed by all sorts of people, that they may be ready
with some kind of exchange to meet particular wants. No community,
however, begins to reap the clear advantages of exchange until some
universally acceptable medium of exchange is discovered and accepted. The
process of developing this medium is essentially the same as that
described in establishing a standard of value; and so the word money
naturally represents both the standard of value and the common currency of
trade. It is easy, however, to see by further examination that the two
functions of money are quite easily separable, and that, while it is
difficult to substitute for the standard of value, a variety of
substitutes can serve as currency.

In speaking of coinage hitherto, the standard of value has been assumed to
be the most important, but in fact a