 Good day again, this is Professor Resnick. I want to talk now following through the capital volume one. I want to talk about money. Marx defines money as a universal equivalent. It is a commodity chosen by society to be universally equivalent to all of the commodities. So it's a way to facilitate exchange. In other words, all the other commodities can express their value in this one particular commodity, which is chosen by society to be universally equivalent to all of them. So the use value of money is precisely its exchange value. All commodities can be exchanged for it. Since the source of abstract labor, I'm sorry, let me do that, since the source of exchange value is abstract labor, we've established that, then when one has command over money, one has command over abstract labor. Why? Because money is the representation of abstract labor. So to accumulate money is literally to accumulate abstract labor. Suppose society chooses gold. Now there's no necessity for gold because it's very arbitrary. Societies have chosen a variety of different commodities through their history. But suppose a society, in fact, chooses gold as money. So gold becomes the commodity chosen by society, such that all the other commodities can be sold for gold. Suppose it takes two hours to produce an ounce of gold. So then we have, by the Marxian abstract labor theory of value, to use the same numbers that we've used before, it takes two hours to produce a one ounce of gold. And now let me put everything else on the blackboard. It took, let's see, eight hours to produce one apple. And it took, what was it? Four hours to produce one shirt, if I remember correctly. So we have altogether 12. We've got 14 hours as the pool of abstract labor. And we have allocated across these different commodities by the production, I'm assuming, the socially necessary abstract labor time to produce each of them. So the good review for us, the value of an apple over the value of gold is eight over two. Same, again, qualitative dimensions, enumerated denominator. So that's four ounces of gold, g gold equal one apple. That's an exchange of equivalents. That's worth eight. That's 2468. Value of a shirt over the value of gold is, what's the value of a shirt here? It's four over two. So that's two ounces of gold equal a shirt. That's an exchange of equivalents. Notice something. Gold is always in the denominator. It's a common denominator. That's what a universal equivalent means. Every commodity can express its value in this universal equivalent. So it's always in the denominator. It's a common denominator. Next step. Suppose this society decides not only that gold is going to be the universal equivalent, but again, to facilitate exchange, it has a mint. It establishes a mint, and it prints gold coins, such that one coin is equal to one ounce. So it's a beautiful nice little coin with a picture of the king or whatever it is on the coin. Coin weighs an ounce. Everybody's concerned that it does weigh an ounce. And one coin is equal to an ounce, and it's called a dollar. So the price of an apple here becomes four coins. The price of a shirt becomes two coins. But since a coin is a dollar, the price of an apple is four dollars, four coins. The price of a shirt is two dollars, two gold coins. So what we have here then is another equation we can easily write. Let me get rid of this. We can ask, how much money do we need? How many dollars do we need in this society? In other words, what is the demand for money in this society? Demand for coins, demand for dollars? Well, let's write it down. We have the value of an apple over the value of gold times the amount of apples plus the value of, what is it, shirts over the value of gold times the number of shirts. So in this case, we have, let's see, we have four dollars, just one apple, plus two dollars, one shirt. So the demand for money is six dollars. So to finance the transactions of the society, the state has to supply six dollars of currency. So we have a new condition of existence of this capitalist economy, which is that the mint, I assume, controlled by the state, has to supply six dollars of gold coins in order to carry forward the transactions in this very simple economy of one apple and one shirt. Marx calls this money as a medium of exchange. So in other words, to carry forward the exchange in the society, the commodities are sold for money, and that money is used to purchase other commodities. Notice that there are different use values. These are not the same. CMC refers to you start out with a use value, whatever it is, you sell it for money, you alienate it, then you use the money to buy some other commodity, and you acquire its use value. So you're not selling apples to buy apples, you're selling your apple to acquire money, and then you're taking the money to purchase a different kind of commodity, a shirt. So the use value is different here. So that's called CMC. So money is here, you can see, is a medium of exchange.