Inthesamemanner，asmoneyisthesignandrepresentativeofathing，everythingisasignandrepresentativeofmoney；andthestateisinaprosperousconditionwhenontheonehandmoneyperfectlyrepresentsallthings，andontheotherallthingsperfectlyrepresentmoney，andarereciprocallythesignofeachother；thatis，whentheyhavesucharelativevaluethatwemayhavetheoneassoonaswehavetheother。
Thisneverhappensinanyotherthanamoderategovernment，nordoesitalwayshappenthere；forexample，ifthelawsfavourthedishonestdebtor，hiseffectsarenolongerarepresentativeorsignofmoney。
Withregardtoadespoticgovernment，itwouldbeaprodigydidthingsthererepresenttheirsign。Tyrannyanddistrustmakeeveryoneburytheirspecie；[3]thingsthereforearenottheretherepresentativeofmoney。
Legislatorshavesometimeshadtheartnotonlytomakethingsintheirownnaturetherepresentativeofspecie，buttoconvertthemevenintospecie，likethecurrentcoin。C？sar，whenhewasdictator，permitteddebtorstogivetheirlandsinpaymenttotheircreditors，atthepricetheywereworthbeforethecivilwar。[4]Tiberiusorderedthatthosewhodesiredspecieshouldhaveitfromthepublictreasuryonbindingovertheirlandtodoublethevalue[5]UnderC？sarthelandswerethemoneywhichpaidalldebts；underTiberiustenthousandsestercesinlandbecameascurrentmoneyequaltofivethousandsestercesinsilver。TheMagnaChartaofEnglandprovidesagainsttheseizingofthelandsorrevenuesofadebtor，whenhismovableorpersonalgoodsaresufficienttopay，andheiswillingtogivethemuptohiscreditors；thusallthegoodsofanEnglishmanrepresentmoney。
ThelawsoftheGermansconstitutedmoneyasatisfactionfortheinjuriesthatwerecommitted，andforthesufferingsduetoguilt。Butastherewasbutverylittlespecieinthecountry，theyagainconstitutedthismoneytobepaidingoodsorchattels。ThiswefindappointedinaSaxonlaw，withcertainregulationssuitabletotheeaseandconvenienceoftheseveralranksofpeople。Atfirstthelawdeclaredthevalueofasouincattle；[6]thesouoftwotremisesansweredtoanoxoftwelvemonths，ortoaewewithherlamb；thatofthreetremiseswasworthanoxofsixteenmonths。Withthesepeoplemoneybecamecattle，goods，andmerchandise，andtheseagainbecamemoney。
Moneyisnotonlyasignofthings；itisalsoasignandrepresentativeofmoney，asweshallseeinthechapteronexchange。
3。OfidealMoney。Thereisbothrealandidealmoney。Civilisednationsgenerallymakeuseofidealmoneyonly，becausetheyhaveconvertedtheirrealmoneyintoideal。Atfirsttheirrealmoneywassomemetalofacertainweightandstandard，butsoondishonestyorwantmadethemretrenchapartofthemetalfromeverypieceofmoney，towhichtheyleftthesamename；forexample，fromalivreatapoundweighttheytookhalfthesilver，andstillcontinuedtocallitalivre；thepiecewhichwasthetwentiethpartofapoundofsilvertheycontinuedtocallasou，thoughitisnomorethetwentiethpartofthispoundofsilver。
Bythismethodthelivreisanideallivre，andthesouanidealsou。
Thusoftheothersubdivisions；andsofarmaythisbecarriedthatwhatwecallalivreshallbeonlyasmallpartoftheoriginallivreorpound，whichrendersitstillmoreideal。Itmayevenhappenthatwehavenopieceofmoneyoftheprecisevalueofalivre，noranypieceexactlywithasou，thenthelivreandthesouwillbepurelyideal。
Theymaygivetoanypieceofmoneythedenominationofasmanylivresandasmanysousastheyplease，thevariationmaybecontinual，becauseitisaseasytogiveanothernametoathingasitisdifficulttochangethethingitself。
Totakeawaythesourceofthisabuse，itwouldbeanexcellentlawforallcountrieswhoaredesirousofmakingcommerceflourishtoordainthatnonebutrealmoneyshouldbecurrent，andtopreventanymethodsfrombeingtakentorenderitideal。
Nothingoughttobesoexemptfromvariationasthatwhichisthecommonmeasureofall。Tradeisinitsownnatureextremelyuncertain；anditisagreateviltoaddanewuncertaintytothatwhichisfoundedonthenatureofthething。
4。OftheQuantityofGoldandSilver。Whilecivilisednationsarethemistressesoftheworld，goldandsilver，whethertheydrawitfromamongthemselves，orfetchitfromthemines，mustincreaseeveryday。
Onthecontrary，itdiminisheswhenbarbarousnationsprevail。WeknowhowgreatwasthescarcityofthesemetalswhentheGothsandVandalsontheoneside，andontheothertheSaracensandTartars，brokeinlikeatorrentonthecivilisedworld。
5。ThesameSubjectcontinued。ThebulliondrawnfromtheAmericanmines，importedintoEurope，andthencesenttotheEast，hasgreatlypromotedthenavigationoftheEuropeannations；foritismerchandisewhichEuropereceivesinexchangefromAmerica，andwhichshesendsinexchangetotheIndies。Aprodigiousquantityofgoldandsilveristhereforeanadvantage，whenweconsiderthesemetalsasmerchandise；
butitisotherwisewhenweconsiderthemasasign，becausetheirabundancegivesanalloytotheirqualityasasign，whichischieflyfoundedontheirscarcity。
BeforethefirstPunicwar，[7]copperwastosilveras960to1；[8]itisatpresentnearlyas731/2to1。Whentheproportionshallbeasitwasformerly，silverwillbetterperformitsofficeasasign。
6。TheReasonwhyInterestwasloweredone—halfaftertheConquestoftheIndies。Garcilassoinformsus[9]thatinSpainaftertheconquestoftheIndiestheinterest，whichwasattenpercent，felltofive。Thiswasanecessaryconsequence。AgreatquantityofspeciebeingallofasuddenbroughtintoEurope，muchfewerpersonshadneedofmoney。Thepriceofallthingsincreased，whilethevalueofmoneydiminished；theproportionwasthenbroken，andalltheolddebtsweredischarged。WemayrecollectthetimeoftheSystem，[10]wheneverythingwasatahighpriceexceptspecie。ThosewhohadmoneyaftertheconquestoftheIndieswereobligedtolowerthepriceorhireoftheirmerchandise，thatis，inotherwords，theirinterest。
Fromthistimetheywereunabletobringinteresttoitsancientstandard，becausethequantityofspeciebroughttoEuropehasbeenannuallyincreasing。Besides，asthepublicfundsofsomestates，foundedonrichesprocuredbycommerce，gavebutaverysmallinterest，itbecamenecessaryforthecontractsofindividualstoberegulatedbythese。Inshort，thecourseofexchangehavingrenderedtheconveyingofspeciefromonecountrytoanotherremarkablyeasy，moneycannotbescarceinaplacewheretheymaybesoreadilysuppliedwithitbythosewhohaveitinplenty。
7。HowthePriceofThingsisfixedintheVariationoftheSignofRiches。Moneyisthepriceofmerchandiseormanufactures。Buthowshallwefixthisprice？or，inotherwords，bywhatpieceofmoneyiseverythingtoberepresented？
Ifwecomparethemassofgoldandsilverinthewholeworldwiththequantityofmerchandisethereincontained，itiscertainthateverycommodityormerchandiseinparticularmaybecomparedtoacertainportionoftheentiremassofgoldandsilver。Asthetotaloftheoneistothetotaloftheother，sopartoftheonewillbetopartoftheother。Letussupposethatthereisonlyonecommodityormerchandiseintheworld，oronlyonetobepurchased，andthatthisisdivisiblelikemoney；apartofthismerchandisewillanswertoapartofthemassofgoldandsilver；thehalfofthetotaloftheonetothehalfofthetotaloftheother；thetenth，thehundredth，thethousandthpartoftheone，tothetenth，thehundredth，thethousandthpartoftheother。Butasthatwhichconstitutespropertyamongmankindisnotallatonceintrade，andasthemetalsormoneywhicharethesignofpropertyarenotallintradeatthesametime，thepriceisfixedinthecompoundratioofthetotalofthingswiththetotalofsigns，andthatofthetotalofthingsintradewiththetotalofsignsintradealso；andasthethingswhicharenotintradeto—daymaybeintradeto—morrow，andthesignsnotnowintrademayenterintotradeatthesametime，theestablishmentofthepriceofthingsfundamentallydependsontheproportionofthetotalofthingstothetotalofsigns。
Thustheprinceorthemagistratecannomoreascertainthevalueofmerchandisethanhecanestablishbyadecreethattherelation1hasto10isequaltothatof1to20。Julian’sloweringthepriceofprovisionsatAntiochwasthecauseofamostterriblefamine。[11]
8。ThesameSubjectcontinued。TheNegroesonthecoastofAfricahaveasignofvaluewithoutmoney。Itisasignmerelyideal，foundedonthedegreeofesteemwhichtheyfixintheirmindsforallmerchandise，inproportiontotheneedtheyhaveofit。Acertaincommodityormerchandiseisworththreema—coutes；another，sixmacoutes；another，tenmacoutes；thatis，asiftheysaidsimplythree，six，andten。Thepriceisformedbyacomparisonofallmerchandisewitheachother。Theyhavethereforenoparticularmoney；buteachkindofmerchandiseismoneytotheother。
Letusforamomenttransfertoourselvesthismannerofvaluingthings，andjoinitwithours：allthemerchandiseandgoodsintheworld，orelseallthemerchandiseormanufacturesofastate，particularlyconsideredasseparatefromallothers，wouldbeworthacertainnumberofmacoutes；and，dividingthemoneyofthisstateintoasmanypartsastherearemacoutes，onepartofthisdivisionofmoneywillbethesignofamacoute。
Ifwesupposethequantityofspecieinastatedoubled，itwillbenecessarytodoublethespecieinthemacoute；butifindoublingthespecieyoudoublealsothemacoute，theproportionwillremainthesameasbeforethedoublingofeither。
If，sincethediscoveryoftheIndies，goldandsilverhaveincreasedinEuropeintheproportionof1to20，thepriceofprovisionsandmerchandisemusthavebeenenhancedintheproportionof1to20。Butif，ontheotherhand，thequantityofmerchandisehasincreasedas1to2——itnecessarilyfollowsthatthepriceofthismerchandiseandprovisions，havingbeenraisedinproportionof1to20，andfalleninproportionof1to2——itnecessarilyfollows，Isay，thattheproportionisonlyas1to10。
Thequantityofgoodsandmerchandiseincreasesbyanaugmentationofcommerce，theaugmentationofcommercebyanaugmentationofthespeciewhichsuccessivelyarrives，andbynewcommunicationswithfreshly—discoveredcountriesandseas，whichfurnishuswithnewcommoditiesandnewmerchandise。
9。OftherelativeScarcityofGoldandSilver。Besidesthepositiveplentyandscarcityofgoldandsilver，thereisstillarelativeabundanceandarelativescarcityofoneofthesemetalscomparedwiththeother。
Theavaricioushoarduptheirgoldandsilver，forastheydonotcaretospend，theyarefondofsignsthatarenotsubjecttodecay。Theyprefergoldtosilver，becauseastheyarealwaysafraidoflosing，theycanbestconcealthatwhichtakesuptheleastroom。Goldthereforedisappearswhenthereisplentyofsilver，byreasonthateveryonehassometoconceal；itappearsagainwhensilverisscarce，becausetheyareobligedtodrawitfromitsconfinement。
Itisthenarulethatgoldiscommonwhensilverisscarce，andgoldisscarcewhensilveriscommon。Thisletsusseethedifferencebetweentheirrelativeandtheirrealabundanceandscarcity，ofwhichIshallpresentlyspeakmoreatlarge。
10。OfExchange。Therelativeabundanceandscarcityofspecieindifferentcountriesformswhatiscalledthecourseofexchange。
Exchangeisafixingoftheactualandmomentaryvalueofmoney。
Silverasametalhasvaluelikeallothermerchandise，andanadditionalvalueasitiscapableofbecomingthesignofothermerchandise。Ifitwerenomorethanmeremerchandise，itwouldlosemuchofitsvalue。
Silver，asmoney，hasavalue，whichtheprinceinsomerespectscanfix，andinotherscannot。
1。Theprinceestablishesaproportionbetweenaquantityofsilverasmetal，andthesamequantityasmoney，2。Hefixestheproportionbetweentheseveralmetalsmadeuseofasmoney。3。Heestablishestheweightandstandardofeverypieceofmoney。Infine，4，hegivestoeverypiecethatidealvalueofwhichIhavespoken。Ishallcallthevalueofmoneyinthesefourrespectsitspositivevalue，becauseitmaybefixedbylaw。
Thecoinofeverystatehas，besidesthis，arelativevalue，asitiscomparedwiththemoneyofothercountries。Thisrelativevalueisestablishedbytheexchange，andgreatlydependsonitspositivevalue。
Itisfixedbythegeneralopinionofthemerchants，neverbythedecreesoftheprince；becauseitissubjecttoincessantvariations，anddependsonathousandaccidents。
Theseveralnations，infixingthisrelativevalue，arechieflyguidedbythatwhichhasthegreatestquantityofspecie。Ifshehasasmuchspecieasalltheotherstogether，itisthenmostproperfortheotherstoregulatetheirsbyherstandard：andtheregulationbetweenalltheotherswillprettynearlyagreewiththeregulationmadewiththisprincipalnation。
Intheactualstateoftheglobe，Hollandisthenationwearespeakingof。Letusexaminethecourseofexchangewithrelationtoher。
TheyhaveinHollandapieceofmoneycalledaflorin，worthtwentysous，orfortyhalf—sousorgros。But，torenderourideasassimpleaspossible，letusimaginethattheyhavenotanysuchpieceofmoneyinHollandasaflorin，andthattheyhavenootherbutthegros：amanwhoshouldhaveathousandflorinsshouldhavefortythousandgros；andsooftherest。NowtheexchangewithHollandisdeterminedbyourknowinghowmanygroseverypieceofmoneyinothercountriesisworth；andastheFrenchcommonlyreckonbyacrownofthreelivres，theexchangemakesitnecessaryforthemtoknowhowmanygrosarecontainedinacrownofthreelivres。Ifthecourseofexchangeisatfifty—four，acrownofthreelivreswillbeworthfifty—fourgros；ifitisatsixty，itwillbeworthsixtygros。IfsilverisscarceinFrance，acrownofthreelivreswillbeworthmoregros；ifplentiful，itwillbeworthless。
Thisscarcityorplenty，whenceresultsthemutabilityofthecourseofexchange，isnotthereal，butarelative，scarcityorplenty。Forexample，whenFrancehasgreateroccasionforfundsinHollandthantheDutchofhavingfundsinFrance，specieissaidtobecommoninFranceandscarceinHolland：andviceversa。
LetussupposethatthecourseofexchangewithHollandisatfifty—four。IfFranceandHollandcomposedonlyonecity，theywouldactaswedowhenwegivechangeforacrown：theFrenchmanwouldtakethreelivresoutofhispocket，andtheDutchmanfifty—fourgrosfromhis。ButasthereissomedistancebetweenParisandAmsterdam，itisnecessarythathewhoforacrownofthreelivresgivesmefifty—fourgros，whichhehasinHolland，shouldgivemeabillofexchangeforfifty—fourgrospayableinHolland。Thefifty—fourgrosisnotthethinginquestion，butabillforthatsum。Thus，inordertojudgeofthescarcityorplentyofspecie，[12]wemustknowifthereareinFrancemorebillsoffifty—fourgrosdrawnuponHollandthantherearecrownsdrawnuponFrance。IftherearemorebillsfromHollandthantherearefromFrance，specieisscarceinFrance，andcommoninHolland；itthenbecomesnecessarythattheexchangeshouldrise，andthattheygiveformycrownmorethanfifty—fourgros；otherwiseIwillnotpartwithit；andviceversa。
Thusthevariousturnsinthecourseofexchangeformanaccountofdebtorandcreditor，whichmustbefrequentlysettled，andwhichthestateindebtcannomoredischargebyexchangethananindividualcanpayadebtbygivingchangeforapieceofsilver。
Wewillsupposethattherearebutthreestatesintheworld，France，Spain，andHolland；thatseveralindividualsinSpainareindebtedtoFrance，tothevalueofonehundredthousandmarksofsilver；andthatseveralindividualsofFranceoweinSpainonehundredandtenthousandmarks：now，ifsomecircumstancebothinSpainandFranceshouldcauseeachtowithdrawhisspecie，whatwillthenbethecourseofexchange？
Thesetwonationswillreciprocallyacquiteachotherofahundredthousandmarks；butFrancewillstillowetenthousandmarksinSpain，andtheSpaniardswillstillhavebillsuponFrance，tothevalueoftenthousandmarks；whileFrancewillhavenoneatalluponSpain。
ButifHollandwasinacontrarysituationwithrespecttoFrance，andinordertobalancetheaccountmustpayhertenthousandmarks，theFrenchwouldhavetwowaysofpayingtheSpaniards：eitherbygivingtheircreditorsinSpainbillsfortenthousandmarksupontheirdebtorsinHolland，orelsebysendingspecietothevalueoftenthousandmarkstoSpain。
Henceitfollowsthatwhenastatehasoccasiontoremitasumofmoneytoanothercountry，itisindifferent，inthenatureofthething，whetherspeciebeconveyedthitherortheytakebillsofexchange。Theadvantageordisadvantageofthesetwomethodssolelydependsonactualcircumstances。WemustinquirewhichwillyieldmostgrosinHolland—moneycarriedthitherinspecie，orabilluponHollandforthelikesum。[13]
WhenmoneyofthesamestandardandweightinFranceyieldsmoneyofthesamestandardandweightinHolland，wesaythattheexchangeisatpar。
Intheactualstateofspecie[14]theparisnearlyatfifty—fourgrostothecrown。Whentheexchangeisabovefifty—fourgros，wesayitishigh；whenbeneath，wesayitislow。
Inordertoknowthelossandgainofastateinaparticularsituationofexchange，itmustbeconsideredasdebtorandcreditor，asbuyerandseller。Whentheexchangeisbelowpar，itlosesasadebtor，andgainsasacreditor；itlosesasabuyerandgainsasaseller。Itisobviousitlosesasdebtor；suppose，forexample，FranceowesHollandacertainnumberofgros，thefewergrosthereareinacrownthemorecrownsshehastopay。Onthecontrary，ifFranceiscreditorforacertainnumberofgros，thelessnumberofgrosthereareinacrownthemorecrownsshewillreceive。Thestatelosesalsoasbuyer，fortheremustbethesamenumberofgrostopurchasethesamequantityofmerchandise；andwhiletheexchangeislow，everyFrenchcrownisworthfewergros。Forthesamereasonthestategainsasaseller。IsellmymerchandiseinHollandforacertainnumberofgros；IreceivethenmorecrownsinFrance，whenforeveryfiftygrosIreceiveacrown，thanIshoulddoifIreceivedonlythesamecrownforeveryfifty—four。Thecontrarytothistakesplaceintheotherstate。IftheDutchareindebtedacertainnumberofcrownstoFrance，theywillgain；ifthismoneyisowingtothem，theywilllose；iftheysell，theylose；andiftheybuy，theygain。
Itispropertopursuethissomewhatfurther。Whentheexchangeisbelowpar；forexample，ifitbeatfiftyinsteadoffifty—four，itshouldfollowthatFrance，onsendingbillsofexchangetoHollandforfifty—fourthousandcrowns，couldbuymerchandiseonlytothevalueoffiftythousand；andthatontheotherhand，theDutchsendingthevalueoffiftythousandscrownstoFrancemightbuyfifty—fourthousand，whichmakesadifferenceof8/54，thatis，alosstoFranceofmorethanone—seventh；sothatFrancewouldbeobligedtosendtoHollandone—seventhmoreinspecieormerchandisethanshewoulddoweretheexchangeatpar。Andasthemischiefmustconstantlyincrease，becauseadebtofthiskindwouldbringtheexchangestilllower，Francewouldintheendberuined。Itseems，Isay，asifthisshouldcertainlyfollow；
andyetitdoesnot，becauseoftheprinciplewhichIhaveelsewhereestablished；[15]whichisthatstatesconstantlyleantowardsabalance，inordertopreservetheirindependency。Thustheyborrowonlyinproportiontotheirabilitytopay，andmeasuretheirbuyingbywhattheysell；andtakingtheexamplefromabove，iftheexchangefallsinFrancefromfifty—fourtofifty，theDutchwhobuymerchandiseinFrancetothevalueofathousandcrowns，forwhichtheyusedtopayfifty—fourthousandgros，wouldnowpayonlyfiftythousand，iftheFrenchwouldconsenttoit。ButthemerchandiseofFrancewillriseinsensibly，andtheprofitwillbesharedbetweentheFrenchandtheDutch；forwhenamerchantcangain，heeasilyshareshisprofit；therearisesthenacommunicationofprofitbetweentheFrenchandtheDutch。InthesamemannertheFrench，whoboughtmerchandiseofHollandforfifty—fourthousandgros，andwho，whentheexchangewasatfifty—four，paidforthemathousandcrowns，willbeobligedtoaddone—seventhmoreinFrenchcrownstobuythesamemerchandise。ButtheFrenchmerchant，beingsensibleofthelosshesuffers，willtakeuplessofthemerchandiseofHolland。TheFrenchandtheDutchmerchantwillthenbothbelosers，thestatewillinsensiblyfallintoabalance，andtheloweringoftheexchangewillnotbeattendedwithallthoseinconvenienceswhichwehadreasontofear。
Amerchantmaysendhisstockintoaforeigncountrywhentheexchangeisbelowparwithoutinjuringhisfortune，because，whenitreturns，herecoverswhathehadlost；butaprincewhosendsonlyspecieintoaforeigncountrywhichnevercanreturn，isalwaysaloser。
Whenthemerchantshavegreatdealingsinanycountry，theexchangethereinfalliblyrises。Thisproceedsfromtheirenteringintomanyengagements，buyinggreatquantitiesofmerchandise，anddrawinguponforeigncountriestopayforthem。
Aprincemayamassgreatwealthinhisdominions，andyetspeciemaybereallyscarce，andrelativelycommon；forinstance，ifthestateisindebtedformuchmerchandisetoaforeigncountry，theexchangewillbelow，thoughspeciebescarce。
Theexchangeofallplacesconstantlytendstoacertainproportion，andthatintheverynatureofthings。IfthecourseofexchangefromIrelandtoEnglandisbelowpar，andthatofEnglandtoHollandisalsounderpar，thatofIrelandtoHollandwillbestilllower；thatis，inthecompoundratioofthatofIrelandtoEngland，andthatofEnglandtoHolland；foraDutchmerchantwhocanhavehisspecieindirectlyfromIreland，bywayofEngland，willnotchoosetopaydearerbyhavingitinthedirectway。This，Isay，oughtnaturallytobethecase；but，however，itisnotexactlyso。Therearealwayscircumstanceswhichvarythesethings；andthedifferentprofitofdrawingbyoneplace，orofdrawingbyanother，constitutestheparticularartanddexterityofthebankers，whichdoesnotbelongtothepresentsubject。
Whenastateraisesitsspecie，forinstance，whenitgivesthenameofsixlivres，ortwocrowns，towhatwasbeforecalledthreelivres，oronecrown，thisnewdenomination，whichaddsnothingrealtothecrown，oughtnottoprocureasinglegrosmorebytheexchange。Weoughtonlytohaveforthetwonewcrownsthesamenumberofgroswhichwebeforereceivedfortheoldone。Ifthisdoesnothappen，itmustnotbeimputedasaneffectoftheregulationitself，buttothenoveltyandsuddennessoftheaffair。Theexchangeadherestowhatisalreadyestablished，andisnotalteredtillafteracertaintime。
Whenastate，insteadofonlyraisingthespeciebyalaw，callsitin，inordertodiminishitssize，itfrequentlyhappensthatduringthetimetakenupinpassingagainthroughtheminttherearetwokindsofmoney——thelarge，whichistheold，andthesmall，whichisthenew；
andasthelargeiscrieddownasnottobereceivedasmoney，andbillsofexchangemustconsequentlybepaidinthenew，onewouldimaginethenthattheexchangeshouldberegulatedbythenew。If，forexample，inFrance，theancientcrownofthreelivres，beingworthinHollandsixtygros，wasreducedone—half，thenewcrownoughttobevaluedonlyatthirty。Ontheotherhand，itseemsasiftheexchangeoughttoberegulatedbytheoldcoin；becausethebankerwhohasspecie，andreceivesbills，isobligedtocarrytheoldcointothemintinordertochangeitforthenew，bywhichhemustbealoser。Theexchangethenoughttobefixedbetweenthevalueoftheoldcoinandthatofthenew。
Thevalueoftheoldisdecreased，ifwemaycallitso，bothbecausethereisalreadysomeofthenewintrade，andbecausethebankerscannotkeepuptotherigourofthelaw，havinganinterestinlettingloosetheoldcoinfromtheirchests，andbeingsometimesobligedtomakepaymentswithit。Again，thevalueofthenewspeciemustrise，becausethebankerhavingthisfindshimselfinasituationinwhich，asweshallimmediatelyprove，hewillreapgreatadvantagebyprocuringtheold。Theexchangeshouldthenbefixed，asIhavealreadysaid，betweenthenewandtheoldcoin。Forthenthebankersfindittotheirinteresttosendtheoldoutofthekingdom，becausebythismethodtheyprocurethesameadvantageastheycouldreceivefromaregularexchangeoftheoldspecie，thatis，agreatmanygrosinHolland；andinreturn，aregularexchangealittlelower，betweentheoldandthenewspecie，whichwouldbringmanycrownstoFrance。
Supposethatthreelivresoftheoldcoinyieldbytheactualexchangeforty—fivegros，andthatbysendingthissamecrowntoHollandtheyreceivesixty，butwithabillofforty—fivegros，theyprocureacrownofthreelivresinFrance，whichbeingsentintheoldspecietoHolland，stillyieldssixtygros；thusalltheoldspeciewouldbesentoutofthekingdom，andthebankerswouldrunawaywiththewholeprofit。
Toremedythis，newmeasuresmustbetaken。Thestatewhichcoinedthenewspeciewoulditselfbeobligedtosendgreatquantitiesoftheoldtothenationwhichregulatestheexchange，and，bythusgainingcreditthere，raisetheexchangeprettynearlytoasmanygrosforacrownofthreelivresoutofthecountry。Isaytonearlythesame，forwhiletheprofitsaresmallthebankerswillnotbetemptedtosenditabroad，becauseoftheexpenseofcarriageandthedangerofconfiscation。
Itisfitthatweshouldgiveaveryclearideaofthis。Mr。Bernard，oranyotherbankeremployedbythestate，proposesbillsuponHolland，andgivesthematone，two，orthreegroshigherthantheactualexchange；
hehasmadeaprovisioninaforeigncountry，bymeansoftheoldspecie，whichhehascontinuallybeensendingthither；andthushehasraisedtheexchangetothepointwehavejustmentioned。Inthemeantime，bydisposingofhisbills，heseizesonallthenewspecie，andobligestheotherbankers，whohavepaymentstomake，tocarrytheiroldspecietothemint；and，asheinsensiblyobtainsallthespecie，heobligestheotherbankerstogivehimbillsofexchangeataveryhighprice。Bythismeanshisprofitintheendcompensatesinagreatmeasureforthelosshesufferedatthebeginning。
Itisevidentthatduringthesetransactions，thestatemustbeinadangerouscrisis。Speciemustbecomeextremelyscarce——1，becausemuchthegreatestpartiscrieddown；2，becauseapartwillbesentintoforeigncountries；3，becauseeveryonewilllayitup，asnotbeingwillingtogivethatprofittotheprincewhichhehopestoreceivehimself。Itisdangeroustodoitslowly；anddangerousalsotodoitintoomuchhaste。Ifthesupposedgainbeimmoderate，theinconveniencesincreaseinproportion。