Marx's Capital - Volume 1 - Part 2 - The Transformation of Money into Capital 💸

These chapters are a bit easier to read. It’s only about 20 pages so I’m going to suggest we read this until Friday 18th March (4 pages per day).

Full text Economic Manuscripts: Capital: Volume One

David Harvey lecture on this section Class 04 Reading Marx's Capital Vol I with David Harvey - YouTube

Thread on Part 1 Marx's Capital - Volume 1 - Part 1 - Commodities and Money 💵

Chapter 4 - The General Formula for Capital

He begins by talking about the formation of the world market and the origins of capital in the 16th century.

There are distinctions between financial (usurers) capital, merchant capital and industrial capital.

Key point in this chapter is that money =/= capital. Capital is money used in a particular way. We can make it capital by putting it into the M-C-M circuit:

“The first distinction we notice between money that is money only, and money that is capital, is nothing more than a difference in their form of circulation.”

Marx distinguishes between the ‘spending’ of money and the ‘advancing’ of money. The intention of the capitalist who puts money into circulation is different from e.g. a peasant selling their corn to buy a coat; it’s about surplus value.

“The value originally advanced, therefore, not only remains intact while in circulation, but adds to itself a surplus-value or expands itself. It is this movement that converts it into capital.”

“It brings forth living offspring, or, at the least, lays golden eggs.”

Capital, fundamentally is value that moves in order to create more value. It is inherently processual, not an entity or factor of production (“Value therefore now becomes value in process, money in process, and, as such, capital.”)

It is a form of circulation that always tends towards expansion. Capital must always be driving towards surplus value.

This chapter also includes the following passage that some people regard as antisemitic.


“The capitalist knows that all commodities, however scurvy they may look, or however badly they may smell, are in faith and in truth money, inwardly circumcised Jews, and what is more, a wonderful means whereby out of money to make more money.”

This is from David Harvey:

Remarks of this sort have been grist for a significant debate over Marx’s supposed anti-Semitism. It is indeed perfectly true that these kinds of phrases crop up periodically. The context of the time was one of widespread anti-Semitism (e.g., the portrayal of Fagin in Dickens’s Oliver Twist ). So you can either conclude that Marx, coming from a Jewish family that converted for job-holding reasons, was subconsciously going against his past or unthinkingly echoing the prejudice of his time, or, at least in this case, you can conclude that his intent is to take all the opprobrium that was typically cast on Jews and to say that it really should be assigned to the capitalist as a capitalist. I will leave you to your own conclusions on that.

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Key concept: ‘Verwertung’ (translated as valorisation) which is about capital’s self-expanding drive.

Just announcing my intention (with the hope of making it more likely that it happens) of catching up with this in the summer when I have more time/am unemployed!
will still be reading the threads too in the meantime

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Chapter 5: Contradictions in the General Formula of Capital

The key point here is:

“We have shown that surplus-value cannot be created by circulation, and, therefore, that in its formation, something must take place in the background, which is not apparent in the circulation itself.”

The contradiction is that surplus value is not generated in circulation but also can’t be generated outside the sphere of circulation.

“It is therefore impossible for capital to be produced by circulation, and it is equally impossible for it to originate apart from circulation. It must have its origin both in circulation and yet not in circulation.”

How is this resolved?