The Operation of Capital

Abstract

When idle money becomes “funds” or universal money, it already implies the operation of capital. For funds do not always remain idle by simply renouncing the purchase of commodities for consumption. While being idle, they are ready to purchase commodities for resale with a pecuniary gain, as soon as an opportunity for it arises. And when funds are spent, the operation of capital has already begun. Therefore, funds are potentially capital. By capital we here mean the “chrematistic” operation of advancing a sum of money, M, for the purpose of acquiring a greater sum of money, M’. Since capital is nothing other than the chrematistic use of funds, only the owner of funds can become a capitalist by using them as capital. The word “chrematistic” originally meant “money-making” or “acquisitive of wealth”. Here, it is used in the sense of “pursuing mercantile (or abstract-general) wealth”.