Capital, Volume Three: The Process of Capitalist Production as a Whole by Karl Marx

Prices.

The turnover of industrial capital is a combination of its period of production and time of circulation, and therefore embraces the entire process of production. The turnover of merchant's capital, on the other hand, being in reality nothing but an alienated movement of commodity- capital, represents only the first phase in the metamorphosis of a commodity, C – M, as the refluent movement of a specific capital; M – C, C – M, is, from the mercantile point of view, the turnover of merchant's capital. The merchant buys, converting his money into commodities, then sells, converting the latter back into money, and so forth in constant repetition. Within circulation, the metamorphosis of industrial capital always presents itself in the form of C1 – M – C2; the money realised by the sale of the produced commodity C1 is used to purchase new means of production, C2. This amounts to a practical exchange of C1 for C2, and the same money thus changes hands twice. Its movement mediates the exchange of two different kinds of commodities, C1 and C2. But in the case of the merchant, it is, conversely, the same commodity which changes hands twice in M – C – M'. It merely promotes the reflux of his money.