Itspreservation——hispreservation——requiresdailyconsumption。HencepaymentforitmustbecontinuouslyrepeatedatrathershortintervalsinorderthathemaybeabletorepeatactsL——M——CorC——M——C，repeatthepurchasesneededforhisself-preservation。Forthisreasonthecapitalistmustalwaysmeetthewage-laborerinthecapacityofamoney-capitalist，andhiscapitalasmoney-capital。Ontheotherhandifthewage-labourers，themassofdirectproducers，aretoperformtheactL——M——C，theymustconstantlybefacedwiththenecessarymeansofsubsistenceinpurchasableform，i。e。，intheformofcommodities。Thisstateofaffairsnecessitatesahighdegreeofdevelopmentofthecirculationofproductsintheformofcommodities，hencealsoofthevolumeofcommoditiesproduced。Whenproductionbymeansofwage-labourbecomesuniversal，commodityproductionisboundtobethegeneralformofproduction。Thismodeofproduction，onceitisassumedtobegeneral，carriesinitswakeaneverincreasingdivisionofsociallabour，thatistosayanevergrowingdifferentiationofthearticleswhichareproducedintheformofcommoditiesbyadefinitecapitalist，evergreaterdivisionofcomplementaryprocessesofproductionintoindependentprocesses。M——MPthereforedevelopstothesameextentasM——Ldoes，thatistosaytheproductionofmeansofproductionisdivorcedtothatextentfromtheproductionofcommoditieswhosemeansofproductiontheyare。Andthelatterthenstandopposedtoeveryproducerofcommoditieswhichhedoesnotproducebutbuysforhisparticularprocessofproduction。Theycomefrombranchesofproductionwhich，operatedindependently，areentirelydivorcedfromhisown，enterintohisownbranchascommodities，andmustthereforebebought。Thematerialconditionsofcommodityproductionfacehimmoreandmoreasproductsofothercommodityproducers，ascommodities。

Andtothesameextentthecapitalistmustassumetheroleofmoney-capitalist，inotherwordsthereisanincreaseinthescaleonwhichhiscapitalmustassumethefunctionsofmoney-capital。

Ontheotherhand，thesameconditionswhichgiverisetothebasicconditionofcapitalistproduction，theexistenceofaclassofwage-workers，facilitatethetransitionofallcommodityproductiontocapitalistcommodityproduction。Ascapitalistproductiondevelops，ithasadisintegrating，resolventeffectonallolderformsofproduction，which，designedmostlytomeetthedirectneedsoftheproducer，transformonlytheexcessproducedintocommodities。Capitalistproductionmakesthesaleofproductsthemaininterest，atfirstapparentlywithoutaffectingthemodeofproductionitself。SuchwasforinstancethefirsteffectofcapitalistworldcommerceonsuchnationsastheChinese，Indians，Arabs，etc。But，secondly，whereverittakesrootcapitalistproductiondestroysallformsofcommodityproductionwhicharebasedeitherontheself-employmentoftheproducers，ormerelyonthesaleoftheexcessproductascommodities。Capitalistproductionfirstmakestheproductionofcommoditiesgeneralandthen，bydegrees，transformsallcommodityproductionintocapitalistcommodityproduction。[3]

Whateverthesocialformofproduction，labourersandmeansofproductionalwaysremainfactorsofit。Butinastateofseparationfromeachothereitherofthesefactorscanbesuchonlypotentially。Forproductiontogoonatalltheymustunite。Thespecificmannerinwhichthisunionisaccomplisheddistinguishesthedifferenteconomicepochsofthestructureofsocietyfromoneanother。Inthepresentcase，theseparationofthefreeworkerfromhismeansofproductionisthestarting-pointgiven，andwehaveseenhowandunderwhatconditionsthesetwoelementsareunitedinthehandsofthecapitalist，namely，astheproductivemodeofexistenceofhiscapital。Theactualprocesswhichthepersonalandmaterialcreatorsofcommoditiesenteruponwhenthusbroughttogether，theprocessofproduction，becomesthereforeitselfafunctionofcapital，thecapitalistprocessofproduction，thenatureofwhichhasbeenfullyanalysedinthefirstbookofthiswork。Everyenterpriseengagedincommodityproductionbecomesatthesametimeanenterpriseexploitinglabour-power。Butonlythecapitalistproductionofcommoditieshasbecomeanepoch-makingmodeofexploitation，which，inthecourseofitshistoricaldevelopment，revolutionises，throughtheorganisationofthelabour-processandtheenormousimprovementoftechnique，theentirestructureofsocietyinamannereclipsingallformerepochs。

Themeansofproductionandlabour-power，insofarastheyareformsofexistenceofadvancedcapital-value，aredistinguishedbythedifferentrolesassumedbythemduringtheprocessofproductioninthecreationofvalue，hencealsoofsurplus-value，intoconstantandvariablecapital。Beingdifferentcomponentsofproductivecapitaltheyarefurthermoredistinguishedbythefactthatthemeansofproductioninthepossessionofthecapitalistremainhiscapitalevenoutsideoftheprocessofproduction，whilelabour-powerbecomestheformofexistenceofanindividualcapitalonlywithinthisprocess。Whereaslabour-powerisacommodityonlyinthehandsofitsseller，thewage-labourer，itbecomescapitalonlyinthehandsofitsbuyer，thecapitalistwhoacquiresthetemporaryuseofit。

Themeansofproductiondonotbecomethematerialformsofproductivecapital，orproductivecapital，untillabour-power，thepersonalformofexistenceofproductivecapital，iscapableofbeingembodiedinthem。

Humanlabour-powerisbynaturenomorecapitalthanbymeansofproduction。

Theyacquirethisspecificsocialcharacteronlyunderdefinite，historicallydevelopedconditions，justasonlyundersuchconditionsthecharacterofmoneyisstampeduponpreciousmetals，orthatofmoney-capitaluponmoney。

Productivecapital，inperformingitsfunctions，consumesitsowncomponentpartsforthepurposeoftransformingthemintoamassofproductsofahighervalue。Sincelabour-poweractsmerelyasoneofitsorgans，theexcessoftheproduct’svalueengenderedbyitssurplus-labouroverandabovethevalueofproductivecapital’sconstituentelementsisalsothefruitofcapital。Thesurplus-labouroflabour-poweristhegratuitouslabourperformedforcapitalandthusformssurplus-valueforthecapitalist，avaluewhichcostshimnoequivalentreturn。Theproductisthereforenotonlyacommodity，butacommoditypregnantwithsurplus-value。ItsvalueisequaltoP+s，thatistosayequaltothevalueoftheproductivecapitalPconsumedintheproductionofthecommodityplusthesurplusvaluescreatedbyit。Letusassumethatthiscommodityconsistsof10，000

lbs。ofyarn，andthatmeansofproductionworth&pound；372andlabourpowerworth&pound；50wereconsumedinthefabricationofthisquantityofyarn。Duringtheprocessofspinning，thespinnerstransmittedtotheyarnthevalueofthemeansofproductionconsumedbytheirlabour，amountingto&pound；372，andatthesametimetheycreated，inproportionwiththelabour-powerexpendedbythem，newvaluetotheamountof，say，&pound；128。

The10，000lbs。ofyarnthereforerepresentavalueof&pound；500。

III。THIRDSTAGE。C’——M’

Commoditiesbecomecommodity-capitalasafunctionalformofexistence——stemmingdirectlyfromtheprocessofproductionitself——

ofcapital-valuewhichhasalreadyproducedsurplus-value。Iftheproductionofcommoditieswerecarriedoncapitalisticallythroughoutsociety，allcommoditieswouldbeelementsofcommodity-capitalfromtheoutset，whethertheywerecrudeiron，Brusselslace，sulphuricacidorcigars。Theproblemofwhatkindsofcommodities，isoneoftheself-createdlovelyillsofscholasticpoliticaleconomy。

Capitalintheformofcommoditieshastoperformthefunctionofcommodities。Thearticlesofwhichcapitaliscomposedareproducedespeciallyforthemarketandmustbesold，transformedintomoney，hencegothroughtheprocessC——M。

Supposethecommodityofthecapitalisttoconsistof10，000lbs。

ofcottonyarn。If&pound；372representthevalueofthemeansofproductionconsumedinthespinningprocess，andnewvaluetotheamountof&pound；128

hasbeencreated，theyarnhasavalueof&pound；500，whichisexpressedinitspriceofthesameamount。SupposefurtherthatthispriceisrealisedbythesaleC——M。Whatisitthatmakesofthissimpleactofallcommoditycirculationatthesametimeacapital-function？Nochangethattakesplaceinsideofit，neitherintheuse-characterofthecommodity——foritpassesintothehandsofthebuyerasanobjectofuse——norinitsvalue，forthisvaluehasnotexperiencedanychangeofmagnitude，butonlyofform。

Itfirstexistedintheformofyarn，whilenowitexistsintheformofmoney。ThusasubstantialdistinctionisevidentbetweenthefirststageM——CandthelaststageC——M。Theretheadvancedmoneyfunctionsasmoney-capital，becauseitistransformedbymeansofthecirculationintocommoditiesofaspecificuse-value。Herethecommoditiescanserveascapitalonlytotheextentthattheybringthischaracterwiththeminreadyshapefromtheprocessofproductionbeforetheircirculationbegins。Duringthespinningprocess，thespinnerscreateyarnvaluetotheamountof&pound；128。Ofthissum，say&pound；50representtothecapitalistmerelyanequivalentforhisoutlayforlabour-power，while&pound；78——whenthedegreeofexploitationoflabour-poweris156percent——formsurplus-value。Thevalueofthe10，000lbs。ofyarnthereforeembodiesfirstthevalueoftheconsumedproductivecapitalP，theconstantpartofwhichamountsto&pound；372andthevariableto&pound；50，theirsumbeing&pound；422，equalto8，440lbs。ofyarn。NowthevalueoftheproductivecapitalPisequaltoC，thevalueofitsconstituentelements，whichinthestageM——Cconfrontedthecapitalistascommoditiesinthehandsoftheirsellers。

Inthesecondplace，however，thevalueoftheyarncontainsasurplus-valueof&pound；78，equalto1，560lbs。ofyarn。Casanexpressionofthevalueofthe10，000lbs。ofyarnisthereforeequaltoCplusDC，orCplusanincrementofC(equalto&pound；78)，whichweshallcallc，sinceitexistsinthesamecommodity-formasnowtheoriginalvalueC。

Thevalueofthe10，000lbs。ofyarn，equalto&pound；500，isthereforerepresentedbyC+c=C’。WhatturnsC，theexpressionofthevalueof10，000lbs。ofyarn，intoC’isnottheabsolutemagnitudeofitsvalue(&pound；500)，forthatisdetermined，asinthecaseofanyotherCstandingfortheexpressionofthevalueofsomeothersumofcommodities，bythequantityoflabourembodiedinit。Itisitsrelativevalue-magnitude，itsvalue-magnitudeascomparedwiththatofcapitalPconsumedinitsproduction。Thisvalueiscontainedinitplusthesurplus-valuesuppliedbytheproductivecapital。Itsvalueisgreater，exceedsthatofthecapital-valuebythissurplus-valuec。The10，000lbs。ofyarnarethebearersofthecapital-valueexpanded，enrichedbythissurplus-value，andtheyaresobyvirtueofbeingtheproductofthecapitalistprocessofproduction。

C’expressesavalue-relation，therelationofthevalueofthecommoditiesproducedtothatofthecapitalspentontheirproduction，inotherwords，expressesthefactthatitsvalueiscomposedofcapital-valueandsurplus-value。

The10，000lbs。ofyarnrepresentcommoditycapital，C’，onlybecausetheyareaconvertedformoftheproductivecapitalP，henceinaconnectionwhichexistsoriginallyonlyinthecircuitofthisindividualcapital，oronlyforthecapitalistwhoproducedtheyarnwiththehelpofhiscapital。

Itis，sotosay，onlyaninternal，notanexternalrelationthatturnsthatturnsthe10，000lbs。ofyarnintheircapacityofvehiclesofvalueintoacommodity-capital。Theyexhibittheircapitalistbirthmarknotintheabsolutemagnitudeoftheirvaluebutinitsrelativemagnitude，inthemagnitudeoftheirvalueascomparedwiththatpossessedbytheproductivecapitalembodiedinthembeforeitwastransformedintocommodities。If，then，these10，000lbs。ofyarnaresoldattheirvalueof&pound；500，thisactofcirculation，consideredbyitself，isidenticalwithC——M，ameretransformationofanunchangingvaluefromtheformofacommodityintothatofmoney。Butasaspecialstageinthecircuitofanindividualcapital，thesameactisarealisationofthecapital-valueembodiedinthecommoditytotheamountof&pound；422plusthesurplus-value，likewiseembodiedinit，of&pound；78。ThatistosayitrepresentsC’——M’，thetransformationofthecommodity-capitalfromitscommodity-formintothemoneyform。[4]

ThefunctionofC’isnowthatofallcommodities，viz。:totransformitselfintomoney，tobesold，togothroughthecirculationstageC——M。

Solongasthecapital，nowexpanded，remainsintheformofcommodity-capital，liesimmovableinthemarket，theprocessofproductionisatrest。Thecommodity-capitalactsneitherasacreatorofproductsnorasacreatorofvalue。Agivencapital-valuewillserve，inwidelydifferentdegrees，asacreatorofproductsandvalue，andthescaleofreproductionwillbeextendedorreducedcommensuratewiththeparticularspeedwithwhichthatcapitalthrowsoffitscommodity-formandassumesthatofmoney，orwiththerapidityofthesale。ItwasshowninBookIthatthedegreeofefficiencyofanygivencapitalisconditionalonthepotentialitiesoftheproductiveprocess，whichtoacertainextentareindependentofthemagnitudeofitsownvalue。[Englishedition:KarlMarx，Capital，Vol。I，pp。602-08——Ed。]Hereitappearsthattheprocessofcirculationsetsinmotionnewforcesindependentofthecapital’smagnitudeofvalueanddeterminingitsdegreeofefficiency，itsexpansionandcontraction。

ThemassofcommoditiesC’，beingthedepositoryoftheexpandedcapital，mustfurthermorepassinitsentiretythroughthemetamorphosisC’——M’。Thequantitysoldishereamaindeterminant。Theindividualcommodityfiguresonlyasanintegralpartofthetotalmass。The&pound；500worthofvalueexistsinthe10，000lbs。ofyarn。Ifthecapitalistsucceedsinsellingonly7，440lbs。attheirvalueof&pound；372，hehasreplacedonlythevalueofhisconstantcapital，thevalueoftheexpandedmeansofproduction。Ifhesells8，440lbs。herecoversonlythevalueofthetotalcapitaladvanced。Hemustsellmoreinordertorealisesomesurplus-value，andhemustselltheentire10，000lbs。inordertorealisethesurplus-valueof&pound；78(1，560lbs。ofyarn)。In&pound；500inmoneyhereceivesmerelyanequivalentforthecommoditysold。HistransactionwithinthecirculationissimplyC——M。Ifhehadpaidhislabourers&pound；64inwagesinsteadof&pound；50hissurplus-valuewouldonlybe&pound；64insteadof&pound；78，andthedegreeofexploitationwouldhavebeenonly100percentinsteadof156。Butthevalueoftheyarnwouldnotchange；onlytherelationbetweenitscomponentpartswouldbedifferent。ThecirculationactC——Mwouldstillrepresentthesaleof10，000lbs。ofyarnfor&pound；500，theirvalue。

C’isequaltoC+c(or&pound；422at&pound；78)。CequalsthevalueofP，theproductivecapital，andthisequalsthevalueofM，themoneyadvancedinM——C，thepurchaseoftheelementsofproduction，amountingto&pound；422inourexample。Ifthemassofcommoditiesissoldatitsvalue，thenCequals&pound；422andcequals&pound；78，thevalueofthesurplus-productof1，560lbs。ofyarn。Ifwecallc，expressedinmoney，m，thenC’——M’=(C+c)-(M+m)，andthecircuitM——C……P……C’——M’，initsexpandedform，isthereforerepresentedbyM——C<LMP……P……(C+c)-(M+m)。

Inthefirststagethecapitalisttakesarticlesofconsumptionoutofthecommodity-marketproperandthelabour-market。Inthethirdstagehethrowscommoditiesback，butonlyintoonemarket，thecommodity-marketproper。Howeverthefactthatheextractsfromthemarket，bymeansofhiscommodities，agreatervaluethanhethrewuponitoriginallyisdueonlytothecircumstancethathethrowsmorecommodity-valuebackuponitthanhefirstdrewoutofit。HethrewvalueMuponitanddrewoutofittheequivalentC；hethrowsC+cbackuponit，anddrawsoutofittheequivalentM+m。

Mwasinourexampleequaltothevalueof8，440lbs。ofyarn。

Buthethrows10，000lbs。ofyarnonthemarket，consequentlyhereturnsagreatervaluethanhetookfromit。Ontheotherhandhethrewthisincreasedvalueonthemarketonlybecausethroughtheexploitationoflabour-powerintheprocessofproductionhehadcreatedsurplus-value(asanaliquotpartoftheproductexpressedinsurplus-product)。Itisonlybyvirtueofbeingtheproductofthisprocessthatthemassofcommoditiesbecomescommodity-capital，thebeareroftheexpandedcapital-value。ByperformingC’——M’theadvancedcapital-valueaswellasthesurplus-valuearerealised。

TherealisationofbothtakesplacesimultaneouslyinaseriesofsalesorinalumpsaleoftheentiremassofcommoditieswhichisexpressedbyC’——M’。ButthesamecirculationactC’——M’isdifferentforcapital-valueandsurplus-value，asitexpressesforeachofthemadifferentstageoftheircirculation，adifferentsectionoftheseriesofmetamorphosesthroughwhichtheymustpassinthesphereofcirculation。Thesurplus-valueccameintotheworldonlyduringtheprocessofproduction。Itappearedforthefirsttimeinthecommodity-market，intheformofcommodities。

Thisisitsfirstformofcirculation，hencetheactc——misitsfirstcirculationact，oritsfirstmetamorphosis，whichremainstobesupplementedbytheantitheticalactofcirculation，orthereversemetamorphosis，m——c。[5]

Itisdifferentwiththecirculationwhichthecapital-valueC

performsinthesamecirculationactC’——M’，andwhichconstitutesforthecirculationactC——M，inwhichCisequaltoP，equaltotheMoriginallyadvanced。Capital-valuehasopeneditsfirstcirculationactintheformofM，money-capital，andreturnsthroughtheactC——Mtothesameform。

Ithasthereforepassedthroughthetwoantitheticalstagesofcirculation，firstM——C，secondC——M，andfindsitselfoncemoreintheforminwhichitcanbeginitscircularmovementanew。Whatforsurplus-valueconstitutesthefirsttransformationofthecommodity-formintothatofmoney，constitutesforcapital-valueinreturn，orretransformation，intoitsoriginalmoney-form。

BymeansofM——C<LMPmoneycapitalistransformedintoanequivalentmassofcommodities，LandMP。Thesecommoditiesnolongerperformthefunctionofcommodities，ofarticlesforsale。Theirvalueisnowinthehandsofthecapitalistwhoboughtthem；theyrepresentthevalueofhisproductivecapitalP。AndinthefunctionofP，productiveconsumption，theyaretransformedintoakindofcommoditydifferingmateriallyfromthemeansofproduction，intoyarn，inwhichtheirvalueisnotonlypreservedbutincreased，from&pound；422to&pound；500。Bymeansofthisrealmetamorphosis，thecommoditiestakenfromthemarketinthefirststage，M——C，arereplacedbycommoditiesofdifferentsubstanceandvalue，whichnowmustperformthefunctionofcommodities，mustbetransformedintomoneyandsold。Theprocessofproductionthereforeappearstobeonlyaninterruptionoftheprocessofcirculationofcapital-value，ofwhichuptothatpointonlythefirstphase，M——C，hasbeenpassedthrough。

Itpassesthroughthesecondandconcludingphase，C——M，afterChasbeenalteredinsubstanceandvalue。Butsofarascapital-value，consideredbyitself，isconcerned，ithasmerelysufferedanalterationofitsuse-formintheprocessofproduction。Itexistedintheformof&pound；422worthofLandMP，whilenowitexistsintheformof&pound；422worthof，or8，440lbs。ofyarn。Ifwethereforeconsidermerelythetwocirculationphasesofcapital-value，apartfromitssurplus-value，wefindthatitpassesthrough1)M——Cand2)C——M，inwhichthesecondChasadifferentuse-formbutthesamevalueasthefirstC。HenceitpassesthroughM——C——M，aformofcirculationwhich，becausethecommodityherechangesplacetwiceandintheoppositedirection——transformationfrommoneyintocommoditiesandfromcommoditiesintomoney——necessitatesthereturnofthevalueadvancedintheformofmoneytoitsmoney-form——itsreconversionintomoney。

ThesamecirculationactC’——M’thatconstitutesthesecondandconcludingmetamorphosis，areturntothemoney-form，forthecapital-valueadvancedinmoney，representsforthesurplus-value——bornealongbythecommodity-capitalandsimultaneouslyrealisedbyitschangeintothemoney-form——itsfirstmetamorphosis，itstransformationfromthecommodity-tothemoney-form，C——M，itsfirstcirculationphase。

Wehave，then，twokindsofobservationstomakehere。First，theultimatereconversionofcapital-valueintoitsoriginalmoney-formisafunctionofcommodity-capital。Secondly，thisfunctionincludesthefirsttransformationofsurplus-valuefromitsoriginalcommodity-formtoitsmoney-form。Themoney-form，then，playsadoublerolehere。Ontheonehanditistheformtowhichavalueoriginallyadvancedinmoneyreturns，henceareturntotheformofvaluewhichopenedtheprocess。Ontheotherhanditisthefirstconvertedformofavaluewhichoriginallyentersthecirculationincommodity-form。Ifthecommoditiescomposingthecommodity-capitalaresoldattheirvalues，asweassume，thenCpluscistransformedintoMplusm，itsequivalent。Therealisedcommodity-capitalnowexistsinthehandsofthecapitalistinthisform:Mplusm(&pound；422plus&pound；78=&pound；500)。

Capital-valueandsurplus-valuearenowpresentintheformofmoney，theformoftheuniversalequivalent。

Attheconclusionoftheprocesscapital-valuehasthereforeresumedtheforminwhichitenteredit，andasmoney-capitalcannowopenandgothroughanewprocess。Justbecausetheinitialandfinalformsofthisprocessarethoseofmoney-capital，M，wecallthisformofthecirculationprocessthecircuitofmoney-capital。Itisnottheformbutmerelythemagnitudeoftheadvancedvaluethatischangedattheclose。

Mplusmisnothingbutasumofmoneyofadefinitemagnitude，inthiscase&pound；500。Butasaresultofthecirculationofcapital，asrealisedcommodity-capital，thissumofmoneycontainsthecapital-valueandthesurplus-value。Andthesevaluesarenownolongerinseparablyunitedastheywereintheyarn；theynowliesidebyside。Theirsalehasgivenbothofthemanindependentmoney-form；211/250ofthismoneyrepresentthecapital-valueof&pound；422and39/250constitutethesurplus-valueof&pound；78。Thisseparation，effectedbytherealisationofthecommodity-capital，hasnotonlytheformalcontenttowhichweshallreferpresently。Itbecomesimportantintheprocessofthereproductionofcapital，dependingonwhethermisentirelyorpartiallyornotatalllumpedtogetherwithM，i。e。，dependingonwhetherornotitcontinuestofunctionasacomponentpartoftheadvancedcapital-value。BothmandMmaypassthroughquitedifferentprocessesofcirculation。

InM’capitalhasreturnedtoitsoriginalformM，toitsmoney-form，aformhoweverinwhichitismaterialisedascapital。

Thereisinthefirstplaceadifferenceofquantity。ItwasM，&pound；422。ItisnowM’，&pound；500，andthisdifferenceisexpressedbyM……M’，thequantitativelydifferentextremesofthecircuit，whosemovementisindicatedonlybythethreedots。M’>M，andM’——M=s，thesurplus-value。ButasaresultofthiscircularmovementM……M’itisonlyM’whichexistsnow；itistheproductinwhichitsprocessofformationhasbecomeextinct。M’nowexistsbyitself，independentlyofthemovementwhichbroughtitintoexistence。Thatmovementisgone；M’isthereinitsplace。

ButM’，beingMplusm，&pound；500，composedof&pound；422advancedcapitalplusanincrementofthesameamountingto&pound；78，representsatthesametimeaqualitativerelation，althoughthisqualitativerelationitselfexistsonlyasarelationbetweenthepartsofoneandthesamesum，henceasaquantitativerelation。M，theadvancedcapital，whichisnowoncemorepresentinitsoriginalform(&pound；422)，existsasrealisedcapital。Ithasnotonlypreserveditselfbutalsorealiseditselfascapitalbybeingdistinguishedassuchfromm(&pound；78)，towhichitstandsinthesamerelationastoanincreaseofitsown，toafruitofitsown，toanincrementtowhichithasgivenbirthitself。Ithasbeenrealisedascapitalbecauseithasbeenrealisedasavaluewhichhascreatedvalue。M’existsasacapital-relation。Mnolongerappearsasmeremoney，butexpresslyplaysthepartofmoney-capital，expressedasaself-expandedvalue，hencepossessingthepropertyofself-expansion，ofhatchingahighervaluethanititselfhas。MbecamecapitalbyvirtueofitsrelationtotheotherpartofM’，whichithasbroughtabout，whichhasbeeneffectedbyitasthecause，whichistheconsequenceofitastheground。ThusM’appearsasthesumofvaluesdifferentiatedwithinitself，functionally(conceptually)distinguishedwithinitself，expressingthecapital-relation。

Butthisisexpressedonlyasaresult，withouttheinterventionoftheprocessofwhichitistheresult。

Partsofvalueassucharenotqualitativelydifferentfromoneanother，exceptinsofarastheyappearasvaluesofdifferentarticles，ofconcretethings，henceinvarioususe-formsandthereforeasvaluesofdifferentcommodities——adifferencewhichdoesnotoriginatewiththemthemselvesasmerepartsofvalue。Inmoneyalldifferencesbetweencommoditiesareextinguished，becauseitistheequivalentformcommontoallofthem。Asumofmoneyintheamountof&pound；500consistssolelyofuniformelementsof&pound；1each。Sincetheintermediatelinksofitsoriginareobliteratedinthesimpleexistenceofthissumofmoneyandeverytracehasbeenlostofthespecificdifferencebetweenthedifferentcomponentpartsofcapitalintheprocessofproduction，thereexistsnowonlythedistinctionbetweentheconceptualformofaprincipalequalto&pound；422，thecapitaladvanced，andanexcessvalueof&pound；78。LetM’beequalto，say，&pound；110，ofwhich&pound；100maybeequaltoM，theprincipal，and10equaltos，thesurplus-value。Thereisanabsolutehomogeneity，anabsenceofconceptualdistinctions，betweenthetwoconstituentpartsofthesumof&pound；110。Any&pound；10ofthissumalwaysconstitute1/11ofthetotalsumof&pound；1/10，whethertheyare1/10oftheadvancedprincipalof&pound；100ortheexcessof&pound；10aboveit。Principalandexcesssum，capitalandsurplus-sum，maythereforebeexpressedasfractionalpartsofthetotalsum。Inourillustration，10/11formtheprincipal，orthecapital，and1/11thesurplussum。Initsmoney-expressionrealisedcapitalappearsthereforeattheendofitsprocessasanirrationalexpressionofthecapital-relation。

True，thisappliesalsotoC’(Cplusc)。Butthereisthisdifference:

thatC’，ofwhichCandcareonlyproportionalvalue-partsofthesamehomogeneousmassofcommodities，indicatesitsoriginP，whoseimmediateproductitis，whileinM’，aformderiveddirectlyfromcirculation，thedirectrelationtoPisobliterated。

Theirrationaldistinctionbetweentheprincipalandtheincrementalsum，whichiscontainedinM’，sofarasthatexpressestheresultofthemovementM……M’，disappearsassoonasitoncemorefunctionsactivelyasmoney-capitalandisthereforenotfixedasamoney-expressionofexpandedindustrialcapital。ThecircuitofcapitalcanneverbeginwithM’(althoughM’nowperformsthefunctionofM)。ItcanbeginonlywithM，thatistosayitcanneverbeginasanexpressionofthecapital-relation，butonlyasaformofadvanceofcapital-value。Assoonasthe&pound；500areoncemoreadvancedascapital，inorderagaintoproduces，theyconstituteapointofdeparture，notoneofreturn。Insteadofacapitalof&pound；422，acapitalof&pound；500isnowadvanced。Itismoremoneythanbefore，morecapital-value，buttherelationbetweenitstwoconstituentpartshasdisappeared。Infactasumof&pound；500insteadofthe&pound；422

mightoriginallyhaveservedascapital。

Itisnotanactivefunctionofmoney-capitaltoappearasM’；

toappearasM’isratherafunctionofC’。Eveninthesimplecirculationofcommodities，firstinC1——M，secondlyinM——C2，moneyMdoesnotfigureactivelyuntilthesecondact，M——C2。

ItsappearanceintheformofMisonlytheresultofthefirstact，byvirtueofwhichitonlythenappearsasaconvertedformofC1。

True，thecapital-relationcontainedinM’，therelationofoneofitspartsasthecapital-valuetotheotherasitsvalueincrement，acquiresfunctionalimportanceinsofaras，withtheconstantlyrepeatedcircuitM……M’，M’splitsintotwocirculations，oneofthemacirculationofcapital，theotherofsurplus-value。Consequentlythesetwopartsperformnotonlyquantitativelybutalsoqualitativelydifferentfunctions，Mothersthanm。Butconsideredbyitself，theformM……M’doesnotincludewhatthecapitalistconsumes，butexplicitlyonlytheself-expansionandaccumulation，sofarasthelatterexpressesitselfaboveallasaperiodicalaugmentationofeverrenewedadvancesofmoney-capital。

AlthoughM’，equaltoMplusm，istheirrationalformofcapital，itisatthesametimeonlymoney-capitalinitsrealisedform，intheformofmoneywhichhasgeneratedmoney。Butthisisdifferentfromthefunctionofmoney-capitalinthefirststage，M——C<LMP。Inthefirststage，Mcirculatesasmoney。Itassumesthefunctionsofmoney-capitalbecauseonlyinitsmoneystatecanitperformamoney-function，canittransformitselfintotheelementsofP，intoLandMP，whichstandopposedtoitascommodities。Inthiscirculationactitfunctionsonlyasmoney，。Butasthisactisthefirststageofcapital-valueinprocess，itissimultaneouslyafunctionofmoney-capital，byvirtueofthespecificuse-formofthecommoditiesLandMPwhicharebought。M’ontheotherhand，composedofM，thecapital-value，andm，thesurplus-valuebegottenofM，standsforself-expandedcapital-value——thepurposeandtheoutcome，thefunctionofthetotalcircuitofcapital。Thefactthatitexpressesthisoutcomeintheformofmoney，asrealisedmoney-capital，doesnotderivefromitsbeingthemoney-formofcapital，money-capital，butonthecontraryfromitsbeingmoney-capital，capitalintheformofmoney，fromcapitalhavingopenedtheprocessinthisform，fromitshavingbeenadvancedinthemoney-form。Itsreconversionintothemoney-formis，aswehaveseen，afunctionofcommodity-capitalC’，notofmoney-capital。

AsforthedifferencebetweenMandM’，it(m)issimplythemoney-formofc，theincrementofC。M’iscomposedofMplusmonlybecauseC’wascomposedofCplusc。InC’thereforethisdifferenceandtherelationofthecapital-valuetothesurplus-valuegeneratedbyitispresentandexpressedbeforebothofthemaretransformedintoM’，intoasumofmoneyinwhichbothpartsofthevaluecomefacetofacewitheachotherindependentlyandmay，therefore，beemployedinseparateanddistinctfunctions。

M’isonlytheresultoftherealisationofC’。BothM’andC’

aremerelydifferentformsofself-expandedcapital-value，oneofthemthecommodity-form，theotherthemoney-form。Bothofthemhavethisincommon:thattheyareself-expandedcapital-value。Bothofthemarematerialisedcapital，becausecapital-valueassuchexistsheretogetherwiththesurplus-value，thefruitobtainedthroughitanddifferingfromit，althoughthisrelationisexpressedonlyintheirrationalformoftherelationbetweentwopartsofasumofmoneyorofacommodity-value。Butasexpressionsofcapitalinrelationandcontradistinctiontothesurplus-valueproducedbyit，henceasexpressionsofself-expandedvalue，M’andC’arethesameandexpressthesamething，onlyindifferentforms。Theydonotdifferasmoney-capitalandcommodity-capitalbutasmoneyandcommodities。Insofarastheyrepresentself-expandedvalue，capitalactingascapital，theyonlyexpresstheresultofthefunctioningofproductivecapital，theonlyfunctioninwhichcapital-valuegeneratesvalue。Whattheyhaveincommonisthatbothofthem，money-capitalaswellascommodity-capital，aremodesofexistenceofcapital。Theoneiscapitalinmoney-form，theotherincommodity-form。Thespecificfunctionsthatdistinguishthemcannotthereforebeanythingelsebutdifferencesbetweenthefunctionsofmoneyandofcommodities。Commodity-capital，thedirectproductofthecapitalistprocessofproduction，isreminiscentofitsoriginandisthereforemorerationalandlessincomprehensibleinformthanmoney-capital，inwhicheverytraceofthisprocesshasvanished，asingeneralallspecialuse-formsofcommoditiesdisappearinmoney。ItisthereforeonlywhenM’itselffunctionsascommodity-capital，whenitisthedirectproductofaproductiveprocessinsteadofbeingtheconvertedformofthisproduct，thatitlosesitsbizarreform，thatistosay，intheproductionofthemoneymaterialitself。IntheproductionofgoldforinstancetheformulawouldbeM——C<LMP……P……M’(Mplusm)，whereM’wouldfigureasacommodityproduct，becausePfurnishesmoregoldthanwasadvancedfortheelementsofproductionofthegoldinthefirstM，themoney-capital。InthiscasetheirrationalnatureoftheexpressionM……M’(Mplusm)disappears。Hereapartofasumofmoneyappearsasthemotherofanotherpartofthesamesumofmoney。

IV。THECIRCUITASAWHOLE

Wehaveseenthattheprocessofcirculationisinterruptedattheendofitsfirstphase，M——C<LMP，byP，inwhichthecommoditiesLandMPboughtinthemarketareconsumedasthematerialandvaluecomponentsofproductivecapital。Theproductofthisconsumptionisanewcommodity，C’，alteredinrespectofsubstanceandvalue。Theinterruptedprocessofcirculation，M——C，mustbecompletedbyC——M。

ButthebearerofthissecondandconcludingphaseofcirculationisC’，acommoditydifferentinsubstanceandvaluefromtheoriginalC。Thecirculationseriesthereforeappearsas1)M——C1；2)C’2——M’，whereinthesecondphaseofthefirstcommodity，C1，anothercommodityofgreatervalueanddifferentuse-form，C’2，issubstitutedduringtheinterruptioncausedbythefunctioningofP，theproductionofC’fromtheelementsofC，theformsofexistenceofproductivecapitalP。However，thefirstformofappearanceinwhichcapitalfacedus(Buch。I，Kap。IV，1)，[Englishedition:Ch。IV——Ed。]viz。，M——C——M’(extended:1)M——C1；2)C1——M’)showsthesamecommoditytwice。Bothtimesitisthesamecommodityintowhichmoneyistransformedinthefirstphaseandreconvertedintomoremoneyinthesecondphase。Inspiteofthisessentialdifference，bothcirculationssharethismuch:thatintheirfirstphasemoneyistransformedintocommodities，andinthesecondcommoditiesintomoney，thatthemoneyspentinthefirstphasereturnsinthesecond。Ontheonehandbothhaveincommonthisrefluxofthemoneytoitsstarting-point，ontheotherhandalsotheexcessofthereturningmoneyoverthemoneyadvanced。TothatextenttheformulaM——C……C’——M’iscontainedinthegeneralformulaM——C——M’。

ItfollowsfurthermorethateachtimeequallygreatquantitiesofsimultaneouslyexistingvaluesfaceandreplaceeachotherinthetwometamorphosesM——CandC’——M’belongingincirculation。ThechangeinvaluepertainsexclusivelytothemetamorphosisP，theprocessofproduction，whichthusappearsasarealmetamorphosisofcapital，ascomparedwiththemerelymetamorphosisofcirculation。

Letusnowconsiderthetotalmovement，M——C……P……C’——M’，or，M——C<LMP……P……C’(C+c)——M(M+m)，itsmoreexpandedform。Capitalhereappearsasavaluewhichgoesthroughaseriesofinterconnected，interdependenttransformations，aseriesofmetamorphoseswhichformjustasmanyphases，orstages，oftheprocessasawhole。Twoofthesephasesbelonginthesphereofcirculation，oneoftheminthatofproduction。Ineachoneofthesephasescapital-valuehasadifferentformforwhichthereisacorrespondinglydifferent，specialfunction。Withinthismovementtheadvancedvaluedoesnotonlypreserveitselfbutgrows，increasesinmagnitude。Finally，intheconcludingstage，itreturnstothesameformwhichithadatthebeginningoftheprocessasawhole。Thisprocessasawholeconstitutesthereforetheprocessofmovingincircuits。

Thetwoformsassumedbycapital-valueatthevariousstagesofitscirculationarethoseofmoney-capitalandcommodity-capital。

Theformpertainingtothestageofproductionisthatofproductivecapital。Thecapitalwhichassumesthisformsinthecourseofitstotalcircuitandthendiscardsthemandineachofthemperformsthefunctioncorrespondingtotheparticularform，isindustrialcapital，industrialhereinthesenseitcompriseseverybranchofindustryrunonacapitalistbasis。

Money-capital，commodity-capitalandproductivecapital，donotthereforedesignateindependentkindsofcapitalwhosefunctionsformthecontentoflikewiseindependentbranchesofindustryseparatedfromoneanother。Theydenotehereonlyspecialfunctionalformsofindustrialcapital，whichassumesallthreeofthemoneaftertheother。

Capitaldescribesitscircuitnormallyonlysolongasitsvariousphasespassuninterruptedlyintooneanother。IfcapitalstopsshortinthefirstphaseM——C，money-capitalassumestherigidformofahoard；

ifitstopsinthephaseofproduction，themeansofproductionliewithoutfunctioningontheoneside，whilelabour-powerremainsunemployedontheother；andifcapitalstopsshortinthelastphaseC’——M’，pilesofunsoldcommoditiesaccumulateandclogtheflowofcirculation。

However，itisinthenatureofthingsthatthecircuititselfnecessitatesthefixationofcapitalforcertainlengthsoftimeinitsvariousphases。Ineachofitsphasesindustrialcapitalistiedupwithadefiniteform:money-capital，productivecapital，commodity-capital。

Itdoesnotacquiretheforminwhichitmayenteranewtransformationphaseuntilithasperformedthefunctioncorrespondingtoeachparticularform。Tomakethisplain，wehaveassumedinourillustrationthatthecapital-valueofthequantityofcommoditiescreatedatthestageofproductionisequaltothetotalsumofthevalueoriginallyadvancedintheformofmoney；or，inotherwords，thattheentirecapital-valueadvancedintheformofmoneypassesoninbulkfromstagetothenext。Butwehaveseen(BuchI，Kap。VI)[Englishedition:Ch。VIII——Ed。]thatapartofconstantcapital，thelabourinstrumentsproper(e。g。，machinery)，continuallyserveanew，withmoreorlessnumerousrepetitionsofthesameprocessofproduction，hencetransfertheirvaluespiecemealtotheproducts。

Itwillbeseenlatertowhatextentthiscircumstancemodifiesthecircularmovementofcapital。Forthepresentthefollowingsuffices:Inourillustrationthevalueofproductivecapitalamountingto&pound；422containedonlytheaveragewearandtearoffactorybuildings，machinery，etc。，thatistosayonlythatpartofvaluewhichtheytransferredtotheyarninthetransformationof10，600lbs。ofcottoninto10，000lbs。ofyarn，whichrepresentedtheproductofoneweek’sspinningof60hours。Inthemeansofproduction，intowhichtheadvancedconstantcapitalof&pound；372wastransformed，theinstrumentsoflabour，buildings，machinery，etc。，figuredasiftheyhadonlybeenrentedinthemarketataweeklyrate。Butthisdoesnotchangethegistofthematterinanyway。Wehavebuttomultiplythequantityofyarnproducedinoneweek，i。e。，10，000lbs。ofyarn，bythenumberofweekscontainedinacertainnumberofyears，inordertotransfertotheyarntheentirevalueoftheinstrumentsoflabourboughtandconsumedduringthisperiod。Itisthenplainthattheadvancedmoney-capitalmustfirstbetransformedintotheseinstruments，hencemusthavegonethroughthefirstphaseM——CbeforeitcanfunctionasproductivecapitalP。Anditislikewiseplaininourillustrationthatthecapitalvalueof&pound；422，embodiedintheyarnduringtheprocessofproduction，cannotbepartofthevalueofthe10，000lbs。ofyarnandenterthecirculationphaseC’——M’untilitisready。Itcannotbesolduntilithasbeenspun。

InthegeneralformulatheproductPisregardedasamaterialthingdifferentfromtheelementsoftheproductivecapital，asanobjectexistingapartfromtheprocessofproductionandhavingause-formdifferentfromthatoftheelementsofproduction。Thisisalwaysthecasewhentheresultoftheproductiveprocessassumestheformofathing，evenwhenapartoftheproductre-enterstheresumedproductionasoneofitselements。

Grainforinstanceservesasseedforitsownproduction，buttheproductconsistsonlyofgrainandhencehasashapedifferentfromthoseofrelatedelementssuchaslabour-power，implements，fertiliser。Buttherearecertainindependentbranchesofindustryinwhichtheproductoftheproductiveprocessisnotanewmaterialproduct，isnotacommodity。Amongtheseonlythecommunicationsindustry，whetherengagedintransportationproper，ofgoodsandpassengers，orinthemeretransmissionofcommunications，letters，telegrams，etc。，iseconomicallyimportant。

A。Chuprov[6]saysonthisscore:”Themanufacturermayfirstproducearticlesandthenlookforconsumers”[hisproduct，thrustoutoftheprocessofproductionwhenfinished，passesintocirculationasacommodityseparatedfromit]。”Productionandconsumptionthusappearastwoactsseparatedinspaceandtime。Inthetransportationindustry，whichdoesnotcreateanynewproductsbutmerelytransfermenandthings，thesetwoactscoincide；itsservices”[changeofplace]”areconsumedthemomenttheyareproduced。Forthisreasontheareawithinwhichrailwayscanselltheirservicesextendsatbest50versts(53kilometres)oneithersideoftheirtracks。”

Theresult，whethermenorgoodsaretransported，isachangeintheirwhereabouts。Yarn，forinstance，maynowbeinIndiainsteadofinEngland，whereitwasproduced。

However，whatthetransportationindustrysellsischangeoflocation。

Theusefuleffectisinseparablyconnectedwiththeprocessoftransportation，i。e。，theproductiveprocessofthetransportindustry。Menandgoodstraveltogetherwiththemeansoftransportation，andtheirtraveling，thislocomotion，constitutestheprocessofproductioneffectedbythesemeans。Theusefuleffectcanbeconsumedonlyduringthisprocessofproduction。Itdoesnotexistasautilitydifferentfromthisprocess，ause-thingwhichdoesnotfunctionasanarticleofcommerce，doesnotcirculateasacommodity，untilafterithasbeenproduced。Buttheexchange-valueofthisusefuleffectisdetermined，likethatofanyothercommodity，bythevalueoftheelementsofproduction(labour-powerandmeansofproduction)consumedinitplusthesurplus-valuecreatedbythesurplus-labourofthelabourersemployedintransportation。Thisusefuleffectalsoentertainstheverysamerelationstoconsumptionthatothercommoditiesdo。Ifitisconsumedindividuallyitsvaluedisappearsduringitsconsumption；ifitisconsumedproductivelysoastoconstitutebyitselfastageintheproductionofthecommoditiesbeingtransported，itsvalueistransferredasanadditionalvaluetothecommodityitself。TheformulaforthetransportindustrywouldthereforebeM——C<LMP……P——M’，sinceitistheprocessofproductionitselfthatispaidforandconsumed，notaproductseparateanddistinctfromit。Hencethisformulahasalmostthesameformasthatoftheproductionofpreciousmetals，theonlydifferencebeingthatinthiscaseM’representstheconvertedformoftheusefuleffectcreatedduringtheprocessofproduction，andnotthebodilyformofthegoldorsilverproducedinthisprocessandextrudedfromit。

Industrialcapitalistheonlymodeofexistenceofcapitalinwhichnotonlytheappropriationofsurplus-value，orsurplus-product，butsimultaneouslyitscreationisafunctionofcapital。Thereforewithitthecapitalistcharacterofproductionisanecessity。Itsexistenceimpliestheclassantagonismbetweencapitalistsandwage-labourers。Totheextentthatitseizescontrolofsocialproduction，thetechniqueandsocialorganisationofthelabour-processarerevolutionisedandwiththemtheeconomico-historicaltypeofsociety。Theotherkindsofcapital，whichappearedbeforeindustrialcapitalamidconditionsofsocialproductionthathaverecededintothepastorarenowsuccumbing，arenotonlysubordinatedtoitandthemechanismoftheirfunctionsalteredinconformitywithit，butmovesolelywithitastheirbasis，henceliveanddie，standandfallwiththisbasis。Money-capitalandcommodity-capital，sofarastheyfunctionasvehiclesofparticularbranchesofbusiness，sidebysidewithindustrialcapital，arenothingbutmodesofexistenceofthedifferentfunctionalformsnowassumed，nowdiscardedbyindustrialcapitalinthesphereofcirculation——modeswhich，duetosocialdivisionoflabour，haveattainedindependentexistenceandbeendevelopedone-sidedly。

ThecircuitM……M’ontheonehandintermingleswiththegeneralcirculationofcommodities，proceedsfromitandflowsbackintoit，isapartofit。Ontheotherhanditformsanindependentmovementofthecapital-valuefortheindividualcapitalist，amovementofitsownwhichtakesplacepartlywithinthegeneralcirculationofcommodities，partlyoutsideofit，butwhichalwayspreservesitsindependentcharacter。First，becauseitstwophasesthattakeplaceinthesphereofcirculation，M——C

andC’——M’，beingphasesofthemovementofcapital，havefunctionallydefinitecharacters。InM——C，Cismateriallydeterminedaslabour-powerandmeansofproduction；inC’——M’thecapital-valueisrealisedplusthesurplus-value。Secondly，becauseP，theprocessofproduction，embracesproductiveconsumption。Thirdly，becausethereturnofthemoneytoitsstarting-pointmakesofthemovementM……M’acircuitcompleteinitself。

Everyindividualcapitalistherefore，ontheonehand，initstwocirculation-halvesM——CandC’——M’，anagentofthegeneralcirculationofcommodities，inwhichiteitherfunctionsorliesconcatenatedasmoneyorasacommodity，thusformingalinkinthegeneralchainofmetamorphosestakingplaceintheworldofcommodities。Ontheotherhanditdescribeswithinthegeneralcirculationitsownindependentcircuitinwhichthesphereofproductionformsatransitionalstageandinwhichthiscapitalreturnstoitsstarting-pointinthesameforminwhichitleftthatpoint。

Withinitsowncircuit，whichincludesitsrealmetamorphosisintheprocessofproduction，itchangesatthesametimethemagnitudeofitsvalue。

Itreturnsnotsimplyasmoney-value，butasaugmented，increasedmoney-value。

LetusfinallyconsiderM——C……P……C’——M’asaspecialformofthecircularcourseofcapital，alongsidetheotherformswhichweshallanalyselater。Weshallfindthatitisdistinguishedbythefollowingfeatures:

1。Itappearsasthecircuitofmoney-capital，becauseindustrialcapitalinitsmoney-form，asmoney-capital，formsthestarting-pointandthepointofreturnofitstotalprocess。Theformulaitselfexpressesthefactthatthemoneyisnotexpendedhereasmoneybutismerelyadvanced，henceismerelythemoney-formofcapital，money-capital。

Itexpressesfurthermorethatexchange-value，notuse-value，isthedeterminingaimofthismovement。Justbecausethemoney-formofvalueistheindependent，tangibleforminwhichvalueappears，theformofcirculationM……M’，theinitialandterminalpointsofwhicharerealmoney，expressesmostgraphicallythecompellingmotiveofcapitalistproduction——money-making。

Theprocessofproductionappearsmerelyasanunavoidableintermediatelink，asanecessaryevilforthesakeofmoney-making。Allnationswithacapitalistmodeofproductionarethereforeseizedperiodicallybyafeverishattempttomakemoneywithouttheinterventionoftheprocessofproduction。

2。Thestageofproduction，thefunctionofP，representsinthiscircuitaninterruptionbetweenthetwophasesofcirculationM——C……

C’——M’，whichinitsturnrepresentsonlytheintermediatelinkinthesimplecirculationM——C——M’。Theprocessofproductionappearsintheformofacircuit-describingprocess，formallyandexplicitlyasthatwhichitisinthecapitalistmodeofproduction，asameremeansofexpandingtheadvancedvalue，henceenrichmentassuchasthepurposeofproduction。

3。SincetheseriesofphasesisopenedbyM——C，thesecondlinkofthecirculationisC’——M’。Inotherwords，thestarting-pointisM，themoney-capitalthatistobeself-expanded；theterminalpointisM’，theself-expandedmoney-capitalMplusm，inwhichMfiguresasrealisedcapitalalongwithitsoffspringm。ThisdistinguishesthecircuitofM

fromthatofthetwoothercircuitsPandC’，anddoessointwoways。

Ontheonehandbythemoney-formofthetwoextremes。Andmoneyistheindependent，tangibleformofexistenceofvalue，thevalueoftheproductinitsindependentvalue-form，inwhicheverytraceoftheuse-valueofthecommoditieshasbeenextinguished。OntheotherhandtheformP……

PdoesnotnecessarilybecomeP……P’(Pplusp)，andintheformC……

C’nodifferencewhateverinvalueisvisiblebetweenthetwoextremes。

ItisthereforecharacteristicoftheformulaM——M’thatforonethingcapital-valueisitsstarting-pointandexpandedcapital-valueitspointofreturn，sothattheadvanceofcapital-valueappearsasthemeansandexpandedcapital-valueastheendoftheentireoperation；andthatforanotherthingthisrelationisexpressedinmoney-form，intheindependentvalue-form，hencemoney-capitalasmoneybegettingmoney。Thegenerationofsurplus-valuebyvalueisnotonlyexpressedastheAlphaandOmegaoftheprocess，butexplicitlyintheformofglitteringmoney。

4。SinceM’，themoney-capitalrealisedasaresultofC’——M’，thecomplementaryandconcludingphaseofM——C，hasabsolutelythesameformasthatinwhichitbeganitsfirstcircuit，itcan，assoonasitemergesfromthelatter，beginthesamecircuitoveragainasanincreased(accumulated)money-capital；M’=M+m。AndatleastitisnotexpressedintheformM……M’that，intherepetitionofthecircuit，thecirculationofmseparatesfromthatofM。Consideredinitsone-timeform，formally，thecircuitofmoney-capitalexpressesthereforesimplytheprocessofself-expansionandofaccumulation。Consumptionisexpressedinitonlyasproductiveconsumption，byM——C<LMP，anditisonlythisconsumptionthatisincludedinthiscircuitofindividualcapital。M——LisL——MorC——Monthepartofthelabourer。Itisthereforethefirstphaseofcirculationwhichbringsabouthisindividualconsumption，thus:L——M——C(meansofsubsistence)。ThesecondphaseM——C，nolongerfallswithinthecircuitofindividualcapital，butisinitiatedandpremisedbyit，sincethelabourermustabovealllive，hencemaintainhimselfbyindividualconsumption，inordertoalwaysbeinthemarketasmaterialthatthecapitalistcanexploit。Butthisconsumptionitselfishereonlyassumedasaconditionfortheproductiveconsumptionoflabour-powerbycapital，henceonlytotheextentthattheworkermaintainsandreproduceshimselfaslabour-powerbymeansofhisindividualconsumption。HowevertheMP，thecommoditiesproperwhichenterintothecircuitofcapital，arenutrimentfortheproductiveconsumptiononly。TheactL——Mpromotestheindividualconsumptionofthelabourer，thetransformationofthemeansofsubsistenceintohisfleshandblood。True，thecapitalistmustalsobethere，mustalsoliveandconsumetobeabletoperformthefunctionofacapitalist。Tothisend，hehas，indeed，toconsumeonlyasmuchasthelabourer，andthatisallthisformofthecirculationprocesspresupposes。

Buteventhisisnotformallyexpressed，sincetheformulaconcludeswithM’，i。e。，aresultwhichcanatonceresumeitsfunctionasmoney-capital，nowaugmented。

C’——M’directlycontainsthesaleofC’；butC’——M’，asaleontheonepart，isM——C，apurchase，ontheotherpart，andinthelastanalysisacommodityisboughtonlyforitsuse-value，inordertoenter(leavingintermediatesalesoutofconsideration)theprocessofconsumption，whetherthisisindividualorproductive，accordingtothenatureofthearticlebought。Butthisconsumptiondoesnotenterthecircuitofindividualcapital，theproductofwhichisC’。Thisproductiseliminatedfromthecircuitpreciselybecauseitisacommodityforsale。C’isexpresslydesignedforconsumptionbyothersthantheproducer。Thuswefindthatcertainexponentsofthemercantilesystem(whichisbasedontheformulaM——C……P……C’——M’)deliverlengthysermonstotheeffectthattheindividualcapitalistshouldconsumeonlyasmuchasthelabourer，thatthenationofcapitalistsshouldleavetheconsumptionoftheirowncommodities，andtheconsumptionprocessingeneral，totheother，lessintelligentnationsbutthattheythemselvesshouldmakeproductiveconsumptiontheirlife’stask。Thesesermonsfrequentlyremindoneinformandcontentofanalogousasceticexpostulationsofthefathersofthechurch。

Capital’smovementincircuitsisthereforetheunityofcirculationandproduction；itincludesboth。SincethetwophasesM——CandC’——M’

areactsofcirculation，thecirculationofcapitalisapartofthegeneralcirculationofcommodities。Butasfunctionallytheyaredefinitesections，stagesincapital’scircuit，whichpertainsnotonlytothesphereofcirculationbutalsotothatofproduction，capitalgoesthroughitsowncircuitinthegeneralcirculationofcommodities。Thegeneralcirculationofcommoditiesservescapitalinthefirststageasameansofassumingthatshapeinwhichitcanperformthefunctionofproductivecapital；inthesecondstageitservestostripoffthecommodity-functioninwhichcapitalcannotrenewitscircuit；atthesametimeitopensuptocapitalthepossibilityofseparatingitsowncircuitfromthecirculationofthesurplus-valuethataccruedtoit。

Thecircuitmadebymoney-capitalisthereforethemostone-sided，andthusthemoststrikingandtypicalforminwhichthecircuitofindustrialcapitalappears，thecapitalwhoseaimandcompellingmotive——theself-expansionofvalue，themakingofmoney，andaccumulation——isthusconspicuouslyrevealed(buyingtoselldearer)。OwingtothefactthatthefirstphaseisM——Citisalsorevealedthattheconstituentsofproductivecapitaloriginateinthecommodity-market，andingeneralthatthecapitalistprocessofproductiondependsoncirculation，oncommerce。Thecircuitofmoney-capitalisnotmerelytheproductionofcommodities；itisitselfpossibleonlythroughcirculationandpresupposesit。Thisisplain，ifonlyfromthefactthattheformMbelongingincirculationappearsasthefirstandpureformofadvancedcapital-value，whichisnotthecaseintheothertwocircuitforms。

Themoney-capitalcircuitalwaysremainsthegeneralexpressionofindustrialcapital，becauseitalwaysincludestheself-expansionoftheadvancedvalue。InP……P，themoney-expressionofcapitalappearsonlyasthepriceoftheelementsofproduction，henceonlyasavalueexpressedinmoneyofaccountandisfixedinthisforminbook-keeping。

M……M’becomesaspecialformoftheindustrialcapitalcircuitwhennewlyactivecapitalisfirstadvancedintheformofmoneyandthenwithdrawninthesameform，eitherinpassingfromonebranchofindustrytoanotherorinretiringindustrialcapitalfromabusiness。Thisincludesthefunctioningascapitalofthesurplus-valuefirstadvancedintheformofmoney，andbecomesmostevidentwhensurplus-valuefunctionsinsomeotherbusinessthantheoneinwhichitoriginated。M……M’maybethefirstcircuitofacertaincapital；itmaybethelast；itmayberegardedastheformofthetotalsocialcapital；itistheformofcapitalthatisnewlyinvested，eitherascapitalrecentlyaccumulatedintheformofmoney，orassomeoldcapitalwhichisentirelytransformedintomoneyforthepurposeoftransferfromonebranchofindustrytoanother。

Beingaformalwayscontainedinallcircuits，money-capitalperformsthiscircuitpreciselyforthatpartofcapitalwhichproducessurplus-value，viz。，variablecapital。Thenormalformofadvancingwagesispaymentinmoney；thisprocessmustberenewedincomparativelyshortintervals，becausethelabourerlivesfromhandtomouth。Thecapitalistmustthereforealwaysconfrontthelabourerasmoney-capitalist，andhiscapitalasmoney-capital。

Therecanbenodirectorindirectbalancingofaccountsinthiscasesuchaswefindinthepurchaseofmeansofproductionandinthesaleofproducedcommodities(sothatthegreaterpartofthemoney-capitalactuallyfiguresonlyintheformofcommodities，moneyonlyintheformofmoneyofaccountandfinallyincashonlyinthebalancingofaccounts)。Ontheotherhand，apartofthesurplus-valuearisingoutofvariablecapitalisspentbythecapitalistforhisindividualconsumption，whichpertainstotheretailtradeand，howevercircuitoustheroutemaybe，thispartisalwaysspentincash，inthemoney-formofsurplus-value。Variablecapitalalwaysappearsanewasmoney-capitalinvestedinwages(M——L)andmassurplus-valuetodefraythecostofindividualconsumptionofthecapitalist。HenceM，advancedvariablecapital-value，andm，itsincrement，arenecessarilyheldintheformofmoneytobespentinthisform。

TheformulaM——C……P……C’——M’，withitsresultM’=M+

m，isdeceptiveinform，isillusoryincharacter，owingtotheexistenceoftheadvancedandself-expandedvalueinitsequivalentform，money。

Theemphasisisnotontheself-expansionofvaluebutonthemoney-formofthisprocess，onthefactthatmorevalueinmoney-formisfinallydrawnoutofthecirculationthanwasoriginallyadvancedtoit；henceonthemultiplicationofthemassofgoldandsilverbelongingtothecapitalist。

Theso-calledmonetarysystemismerelyanexpressionoftheirrationalformM——C——M’，amovementwhichtakesplaceexclusivelyincirculationandthereforecanexplainthetwoactsM——CandC——M’innootherwaythanasasaleofCaboveitsvalueinthesecondactandthereforeasCdrawingmoremoneyoutofthecirculationthanwasputintoitbyitspurchase。OntheotherhandM——C……P……C’——M’，fixedastheexclusiveform，constitutesthebasisofthemorehighlydevelopedmercantilesystem，inwhichnotonlythecirculationofcommoditiesbutalsotheirproductionappearsasanecessaryelement。

TheillusorycharacterofM——C……P……C’——M’andthecorrespondinglyillusoryinterpretationexistswheneverthisformisfixedasoccurringonce，notasfluentandeverrenewed；hencewheneverthisformisconsiderednotasoneoftheformsofthecircuitbutasitsexclusiveform。Butititselfpointstowardotherforms。

Inthefirstplacethisentirecircuitispremisedonthecapitalistcharacteroftheprocessofproduction，andthereforeconsidersthisprocesstogetherwiththespecificsocialconditionsbroughtaboutbyitasthebasis。M——C=M——C<LMP；butM——Lassumestheexistenceofthewage-labourer，andhencethemeansofproductionaspartofproductivecapital。Itassumesthereforethattheprocessoflabourandself-expansion，theprocessofproduction，isafunctionofcapital。

Inthesecondplace，ifM……M’isrepeated，thereturntothemoney-formappearsjustasevanescentasthemoney-forminthefirststage。

M——CdisappearstomakeroomforP。Theconstantlyrecurrentadvanceintheformofmoneyanditsconstantreturnintheformofmoneyappearmerelyasfleetingmomentsinthecircuit。

Inthethirdplace_______________^_________________/

\M——C……P……C’——M。M——C……P……C’——M’。M——C……P……

etc。\_________________v________________/\__________v________/Beginningwiththesecondrepetitionofthecircuit，thecircuitP……

C’——M’。M——C……PappearsbeforethesecondcircuitofMiscompleted，andallsubsequentcircuitsmaythusbeconsideredundertheformofP……C’——M——C……P，sothatM——C，beingthefirstphaseofthefirstcircuit，ismerelythepassingpreparationfortheconstantlyrepeatedcircuitoftheproductivecapital。Andthisindeedissointhecaseofindustrialcapitalinvestedforthefirsttimeintheformofmoney-capital。

OntheotherhandbeforethesecondcircuitofPiscompleted，thefirstcircuit，thatofcommodity-capital，C’——M’。M——C……P……C’

(abridgedC’……C’)hasalreadybeenmade。Thusthefirstformalreadycontainstheothertwo，andthemoney-formthusdisappears，sofarasitisnotmerelyanexpressionofvaluebutanexpressionofvalueintheequivalentform，inmoney。

Finally，ifweconsidersomenewlyinvestedindividualcapitaldescribingforthefirsttimethecircuitM——C……P……C’——M’，thenM——Cisthepreparatoryphase，theforerunnerofthefirstprocessofproductiongonethroughbythisindividualcapital。ThisphaseM——Cisconsequentlynotpresupposedbutrathercalledforornecessitatedbytheprocessofproduction。Butthisappliesonlytothisindividualcapital。

Thegeneralformofthecircuitofindustrialcapitalisthecircuitofmoney-capital，wheneverthecapitalistmodeofproductionistakenforgranted，henceinsocialconditionsdeterminedbycapitalistproduction。

Thereforethecapitalistprocessofproductionisassumedasapre-condition，ifnotinthefirstcircuitofthemoney-capitalofanewlyinvestedindustrialcapital，thenoutsideofit。ThecontinuousexistenceofthisprocessofproductionpresupposestheconstantlyrenewedcircuitP……P。Eveninthefirststage，M——C<LMP，thispremiseplaysapart，forthisassumesontheonehandtheexistenceoftheclassofwage-labourers；andthen，ontheother，thatwhichisM——C，thefirststage，forthebuyerofmeansofproduction，isC’——M’fortheirseller；

henceC’presupposescommodity-capital，andthusthecommoditiesthemselvesasaresultofcapitalistproduction，andtherebythefunctionofproductivecapital。

NOTES

[1]FromManuscriptII——F。E。

[2]？？？？？？

[3]EndofManuscriptVII。BeginningofManuscriptVI——F。E。

[4]EndofManuscriptVI。BeginningofManuscriptV——F。E。

[5]Thisistruenomatterhowweseparatecapital-valueandsurplus-value。10，000lbs。ofyarncontain1，560lbs。，or&pound；78worthofsurplus-value；likewise，onelb。，oroneshilling’sworthofyarn，contains2。496ounces，or1。872penceworth，ofsurplus-value。

[6]A。Chuprov，Railroading，Moscow，1875，pp。69and70。

1885:CapitalII——Chapter2

partI

THEMETAMORPHOSESOFCAPITALANDTHEIRCIRCUITS

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