Capital III, Chapter 19 - Part 8

The creation of money hoards such as the gold and foreign currency reserves, as well as things such as Special Drawing Rights, held at the IMF, fulfil the same function, at an international level, as such money hoards fulfil at the national level. That is they are,

“...necessary precipitates of the circulation process.” (p 321)

The role of money-dealing capital is important because as part of of the circulation of commodity-capital what is being circulated is not just money, and not just commodities, but capital. The money-dealing capital has an important role to play, therefore, in the circulation of capital, and as was seen in Capital II, anything that speeds up the circulation of capital, thereby raises the annual rate of profit, and releases capital for additional accumulation.

Marx says,

“If the entire circulation of money is in volume, form and movement purely a result of commodity-circulation, which, in its turn, from the capitalist point of view, is only the circulation process of capital (also embracing the exchange of capital for revenue, and of revenue for revenue, so far as outlay of revenue is effected through retail trade), it is self-evident that dealing in money does not merely promote the circulation of money, a mere result and phenomenon of commodity-circulation. This circulation of money itself, a phase in commodity-circulation, is taken for granted in money-dealing. What the latter promotes is merely the technical operations of money circulation which it concentrates, shortens, and simplifies. Dealing in money does not form the hoards. It provides the technical means by which the formation of hoards may, so far as it is voluntary (hence, not an expression of unemployed capital or of disturbances in the reproduction process), be reduced to its economic minimum because, if managed for the capitalist class as a whole, the reserve funds of means of purchase and payment need not be as large as they would have to be if each capitalist were to manage his own.” (p 321)

However, it should not be taken from this that the circuit of money is the same as the circuit of commodities or capital. In so far as commodities produced capitalistically, form commodity-capital, their sale is an intrinsic element of the circuit of capital. But, once sold for final consumption, they leave the circuit of capital, as demonstrated in Capital II.

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