The money of a community performs very important functions, and has laws and principles of its own. It is characterized by a degree of mobility or activity to which no other species of capital can approach. There are few commodities which change hands more than once or twice in passing from the producers to the consumers, where they disappear and terminate; but a piece of money or coin may be passing from hand to hand from the time it is struck off at the mint until it is worn out; during which course of circulation, it may have been received and paid away by thousands, and traversed more miles of space than would encircle the globe. In treating of this important agent in all civilized countries, we will successively consider its origin, its functions, and its laws.

1. As to its origin. Though it renders most essential services to society, especially in saving time and labor, it must not be supposed, as has sometimes been done, that a perception of these benefits has led to its adoption. This is no more the case than that the advantages of literature caused the invention of letters. In the progress of society, mankind are gradually led, by their instinctive wants and desires, to the discovery and adoption of what will afford gratification to those wants and desires; and they thus occasionally light on contrivances and expedients which prove to possess a degree of utility that had never been foreseen.

The process by which money, or a common medium of exchange, was first introduced, seems to have been as follows: At first, the diversified wants of individuals would lead them to exchange some article that they possessed for another which was more desirable to them; and by such exchange each party was benefited, or received more value than he parted with. Hence the practice of barter, which we find to exist in the rudest stages of society. But its advantages are, in the nature of things, very circumscribed. One man, wishing to exchange cloth for bread, may not meet with one who possessed bread and wanted cloth; another, owning a horse, might wish to exchange him for several articles which no single individual was likely to possess, and the horse could not be parcelled out among all those who had the articles he wanted. These, and the like difficulties, in the practice of barter, would naturally induce men, when they could not by exchange obtain the precise article they wanted, to seek that commodity which was in most general request, and which could be kept without loss or deterioration. In this way, by degrees, some species of property would become more generally desired, until it became a common medium of exchange, or money. Thus, in pastoral nations - the first in which men began to accumulate property - cattle and sheep became a currency; and money is thought to have borrowed its name,* in some languages, from this circumstance. These animals, being fed by natural pastures, could be kept not only without loss, but with positive gain, arising from their growth and their multiplication, as well as their milk. When Kentucky was first settled, and steam had not yet facilitated the navigation of the Mississippi, cattle, horses, and hogs afforded the only means of traffic with the Atlantic region. They were accordingly received by the country merchant in exchange for his goods; and when he had become possessed of enough to make a drove, they were transported on foot to the Atlantic States with more celerity and at a less expense than any other species of property. Other commodities have in like manner grown up to be the currency in other countries, as the grains of cocoa in Mexico, salt and slaves in Africa, etc.

But no articles whatever have so generally recommended themselves to the adoption of mankind for the purpose of money as silver and gold; and we find evidence in the Bible that thousands of years ago those metals were the common measures of value and the general mediums of exchange.

* As in pecunia, from pecus.

We see the source of this superiority in the qualities they possess. In the first place, it was important that they should have intrinsic value in the eyes of mankind, and this they possess in their brilliancy and beauty - they being by all classes of men, whether rude or civilized, prized as personal ornaments. Their unequalled lustre gives an excitement and gratification to the sense of vision that is given by nothing else except the precious stones, which, for the same reason, have always been highly valued by mankind. Besides this fundamental quality of being desirable for their own sake, their exchangeable value was increased by their scarcity, and the labor of procuring them. Nature has been very profuse in her production of iron, lead, and copper, but very sparing in that of gold and silver; and to their consequent extraordinary value in the market they owe their portability, by which they can be transmitted to a great distance at little comparative cost, and serve to defray the expenses of travel in remote countries.

Another advantage of these metals is their uniformity. One piece of gold, wherever found, has the same specific gravity, the same malleability and ductility, and nearly the same color, as every other piece. So as to silver. They are also capable of being divided into small portions, to suit different degrees of value; and those portions can be at pleasure reunited into a homogeneous mass by melting. Another recommendation of these metals is that they are not liable to change, especially gold; most other metals being more or less acted on by air or water, so as to oxidate or rust. There are numerous coins in the collections of the curious which were struck two thousand years ago, and are apparently unchanged. And lastly, they are capable of receiving an impression, by being moulded or stamped, so that they can be readily identified, and their exchangeable value known by inspection.

The utility of these metals for ornament is greatly augmented by their being malleable into leaves of extreme thinness, so that with a small portion a great surface can be covered over. An ounce of gold, when beaten into leaf, would gild 166 square feet of surface. In like manner, it may be drawn into wire so small as to be scarcely discernible to the naked eye.