Honestly, *I* don’t understand why you aren’t having more fun with this chapter; Smith’s tactics are right up your alley (or, in some cases, maybe just up Vlad’s), and even his (uh, Smith’s, not Vlad’s) economic perspective is not always as far divorced from your own as you seem to place it. Going through these posts and comments, I sometimes feel it would be much easier to hash the whole money-mess out face-to-face while you’re in town. Then I remember our track record and smack myself smartly upside the head until all I feel is dizzy.

And I’ve been meaning to ask, apropos of absolutely nothing, except maybe Vlad: how many people, including, perhaps, the author, have called Alastair Reynolds’ “Redemption Ark” to your attention since it first came out 7 years ago?

1. Money is not necessarily government issued; it doesn’t have to be to be money, and it often wasn’t in Smith’s day.
2. Most commodities do not change shape once they reach the market.
3. The value of ANY commodity–to the one selling it–is that of the consumable goods it can purchase (to the seller, money is a consumable good in every way, yes? He consumes it by spending it on something else). Like any commodity, it’s usefulness has not been exhausted until it is destroyed; one important reason for going to precious metals for money is that they do not destroy easily or quickly, hence they maintain their use-value.
4. Money can, indeed, return a value: by being loaned. If instead of money, I wished to loan out a machine (say a loom to a weaver) for a given time, I would expect recompense in the same way that a banker expects recompense for the use of his money. When economists speak of interest rates, they speak of the “cost of money” and they do so for very good reason.

Yahtzee(tm)! Money changes hands but it never changes shape. It never becomes edible or wearable or in any way more, less, or other than a production-facilitating official medium of exchange. Its entire value, from the moment it leaves the mint, lies in the consumable goods–i.e., the true results of production–it can command. When we get cash “income” from wages, rent, or profit, those coins are simply a standardized representation of our individual share in “the whole annual produce of land and labor.” Nor, for that matter, are coins fresh-minted for every hour of labor we put in to earn them. Unlike the real produce it represents, the same stock of money keeps cycling round and round through the ecomonic system. Earn & spend. Produce & consume. It’s a new loaf of bread with each sale, but the village baker might take in–and then shell out again to replace his materials or pay his labor–the exact same coin dozens of times in the course of his career. That’s why we would never think of “buying” money, and why we shouldn’t ever think of it as produce or direct revenue.

Should we consider the buying and selling of money–with money? (”Wot’ll it be, then, ser?” “Three shillin’ an’ tuppence, an’ yer ‘appen ter ‘ave sich in stock.” Roight-o, ser; that’ll be–just let me tot it up ‘ere–yep, be three shillin’ an’ tuppence. Nor wull ye be foindin’ a foiner proice anywhurs else.”) Not going to happen. What about buying money with some other commodity or service? Well, Smith’s model already covers that. As selling goods for cash. Selling money for some other commodity or service? Smith has that down as buying goods. For cash. Buying coins on credit? That would be taking out a loan. Or the ever-popular discount on bills of exchange. (And wasn’t that a day-at-the-beach bunch of paragraphs to wade through?) In the market to buy doubloons with your coins? That’s regulated as foreign currency exchange. Or possibly an investment strategy, though I doubt it had much going for it in an age where most countries had their own stashes of gold & silver coins. There just isn’t any way to make money work for us, except as the specific tool it’s been made into. Unless we melt it down and start over, but then it isn’t an official medium of exchange anymore.

All of which gets at what I tried to sneak past you with my blanket statement about overriding normal considerations of use and value. And now maybe I can distract you by taking up your initial question about what message Smith is trying to send in the part of Ch. II.2 that got me into this mess in the first place: he’s priming us (okay, our 18th century counterparts) to look with favor on his proposals for reducing the reliance on precious metals as the official medium of exchange.

If worth is what we’re measuring, yes, we want to add together all goods, cash, and any other assets that might be hiding under the mattress or in Swiss bank accounts (unless I get my hands on them first, in which case, dude, they are *so* gone). But Smith doesn’t want to exclude money from calculations of worth; what he says it “makes itself no part of” is revenue. And revenue, by any definition, concerns itself only with income, return, or yield over a specified period of time. For Smith’s purposes (p. 234, para. 5):

Gross Revenue of Society = the Whole Annual Produce of Land and Labor

Also per Smith (p. 234, para. 2):

The Price, or Exchangeable Value, of Society’s Whole Annual Produce of Land and Labor = Wages of Labor + Profits of Stock + Rent of Land

If we accept those two statements, it logically follows that we can measure Gross Revenue in terms of either actual units of Produce OR the Exchange Value thereof, but never as the sum of both together. And Smith makes it plain that he prefers the goods to the cash.

If I’ve still got my head up my foot, I’m just going to go stand in the wastebasket over there until I’ve learned not to sass my betters.