Louis Proyect wrote:
... you can't have generalized capitalist property relations without money. The enormous inflow of silver and gold into Europe in the 16th and 17th century was a foundation for future capitalist development. You can't develop industry without banking and banking relied relied on silver and gold.
We currently have capitalism without gold or silver money. Even in a system without fiat (government-declared) money, capitalism can leverage a small amount of gold or silver -- so that there's a much larger amount of money in circulation -- by having specie-backed paper money. Specie-backed paper money (of the sort that prevailed in the US during most periods before the 1930s) works best when the state has asserted sovereign power over the country. (This is also true of convertible bank-notes, because the state's regulation of banks is needed.) Even if we ignore such paper money, the need for sufficient circulating medium can be served by attaching a higher price to any ounce of gold. The problem is technical: gold coins can get too small to be useful. The enormous flow of gold into Europe after 1492 solved that problem, but created a new one: serious inflation (the "price revolution"). Even those who got the gold first (the conquistadores, etc.) sometimes ended up as losers because those holding on to scarce goods (like weapons) could jack up their prices. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante.
