ABSTRACT
A right to receive gold serves as well as the gold itself, if all that is required is a medium. In 1797 the Bank of England suspended gold payments, and was forbidden by law to pay its notes in money. The gold standard may be regarded as a device for enabling the authority through which money is issued to solve this problem in a rough and ready way. The classical form of the gold standard is that based on the free coinage of gold. The demand can only be satisfied by bringing gold to the Mint, and the Mint will only issue coin in exchange for the gold at the prescribed price. The essence of the gold standard is that the price of gold, the value of gold in monetary units, is fixed by law, and this determines the value of the monetary unit itself.
