Dense textual analysis might appear to lend plausibility to Sgambati’s critique of The Nature of Money [Sgambati Reference Sgambati2015]; however, it is replete with misunderstanding and misrepresentation. Given the critique’s complexity, perhaps only the book’s author is able to detect and unravel the extent of the obfuscation. Limitation on space restricts my response to the most fundamental of the myriad errors and confusion, and unfortunately precludes dealing with Sgambati’s alternative analysis of money’s “significance.”

The dismissal is uncompromising: “[Ingham] fails to provide a theoretically consistent alternative to mainstream economics and eventually to grasp the actual significance—or ‘specificity’ [Ingham 2007]—of money” [Sgambati Reference Sgambati2015: 309]. (As we shall see, the conflation of “significance” and “specificity” is an underlying source of Sgambati’s confusion.) Given my aims, his further indictment could not be more damning: “[Ingham’s] sociology reproduces an understanding […] as deficient and contorted as its orthodox counterparts, and equally blameable for a residual ‘economic determinism’”.^{Footnote 1} Despite my methodological relationalism (sic) (I assume that this refers to my sociological analysis of money as being constituted by credit-debt relations denominated in a money of account), I rely on “logical and ‘meta-theoretical’ arguments to justify (sic) the nature, origins, and development of money […] outside social relations […] [in] the ad hoc agency of the state” which, moreover, I am charged with seeing as exclusively “steered by a subtle (sic) market logic” [Sgambati 309].

The challenge to my central proposition is speciously contrived. After agreeing with me that “[money] is uniquely specified as a measure of abstract value (money of account) […] and as a means of storing and transporting this abstract value for means of final payment or settlement of debt” [Ingham Reference Ingham2004: 70], quoted in Sgambati, 311, Sgambati then charges me with self-contradiction: by concurring with Keynes that money of account is the “primary concept” in a theory of money, I am unable to understand money as value in itself [Sgambati 310]. “Despite recognising a fundamental duplicity (sic) in the money phenomenon, Ingham does not really try to make sense of the unity of money as the measure of value and as a value in itself” [309]. Sgambati sees, but does not properly understand, the “Janus-faced nature of money” [Sgambati: 314]. Correctly, he notes that we do not merely measure values with a nominal unit of account, “but we bring them into being” [Sgambati: 313]. However, Sgambati continues by unwittingly stumbling into orthodox economics’ error in asserting that “the nominal value can only come into existence along with real value” [314]. Like most mainstream economists, he does not grasp that monetary value – as opposed to subjective estimations of utility or worth—exists as a result of being measured by a money of account [Ingham Reference Ingham2004; see also Orléan Reference Orléan2011]. Money of account is the abstract representation of a prospective value with which interacting buyers and sellers, creditors and debtors determine the actual monetary value of goods and debts [Ingham Reference Ingham2004: 71]. In other words, monetary value—as opposed to incommensurable subjective estimations—is actualized in social interaction. None the less, Sgambati contends that I cannot explain value from “within social relations” and, consequently, that I have recourse to the “ad hoc metaphysical” agency of the state. In this strong implication that money of account merely measures pre-existing real value [Sgambati 316; 320],^{Footnote 2} it is Sgambati—not me—who reproduces orthodox economics’ arguments.

“Unique specificity” of money [Ingham Reference Ingham2004: 24-25; 69-71] was used precisely to identify, following Keynes, the nature of “money proper which in the full sense of the term can only exist in relation to money of account”, as opposed to a mere a “convenient medium of exchange” [Keynes: 1930: 3].^{Footnote 3} Tradable commodities might perform as media in quasi-barter, as economics’ creation myth maintains, but their unstable exchange ratios, varying by traders’ preferences, would preclude the development of a stable universal (unit) money of account (see note 1 on Konings’s grasp of this quintessential point).^{Footnote 4} These specific definitive unified properties of money—unit of account and means of transmissible abstract value—enable the nomination of price bids/offers, debt contracts and provide the means for their settlement [Ingham Reference Ingham2004: 69-74; et passim; Keynes 1930: 3].

The allegation of self-contradiction—failure to understand the unity of money as measure and value and recourse to the “metaphysical” state that imposes the value of money—also results from misreading and conflating distinct parts of my book and drawing contorted conclusions. In the Introduction to The Nature of Money, I observed that money had dual properties as societal infrastructural power and as despotic power when controlled by particular interests [Ingham Reference Ingham2004: 4]. Sgambati mistakenly reads this as the same duality as money as both measure and transmitter of abstract value, as outlined above [Ingham Reference Ingham2004: 70, quoted in Sgambati: 311]. Confusing the different arguments and taking the contrast of infrastructural and despotic power as a “contradiction” somehow enables Sgambati to accuse me of both contradiction and of “not trying to make sense of the unity” of the measure and the means which transmit value. I am charged with not doing precisely that which I explicitly establish in the very same passage that Sgambati quotes with approval [Ingham Reference Ingham2004: 70, quoted in Sgambati: 311]. In short, the alleged self-contradiction is entirely an artefact of his confusion.

Further loose reading compounds the error. My agreement with Keynes that “money of account is the primary concept of a theory of money” [Keynes 1930: 3; emphasis added] is construed as evidence that, despite my own words, I really think that money is nothing more than money of account—“a measure with no value” [Sgambati: 310]. However, this inference cannot be drawn. Money of account is a primary in two senses: first, price lists and debt contracts written and settled at different time periods cannot exist without it; second, as I have outlined, it cannot arise from the volatility of fluctuating exchange ratios of merely exchangeable commodities. (Presumably, this is what Sgambati considers to be an illegitimate “logical” argument.) I argued that the unity of money of account (measure of abstract value) and that which bears/transmits the value is (socio)logically indivisible in so far as the value of the latter, as money, cannot be established without the former. To repeat: myriad commodity exchanges cannot in themselves produce a money of account; this requires an authority—an association of merchants, a local community, or a state.^{Footnote 5} An authority declares and attempts to enforce what is to be literally counted as valuable, leaving the actual realisation of value to the struggle between the users of the media that bear the measure of prospective value.^{Footnote 6} Of course, states also participate in the economic struggle.^{Footnote 7} In order to sustain his misrepresentation, Sgambati is ludicrously driven to deny the obvious fact that states are powerful economic agents in their own right and that they have a considerable effect on the actual value of money. But this does not mean that they are exclusively “steered by a subtle (sic) market logic” [Sgambati: 309].^{Footnote 8} As my conception of the state is not “metaphysical” and “outside social relations,” Sgambati’s contrived revelation of a further self-contradiction that I cannot coherently advance my central argument—that money is constituted by the social relation of credit-debt—is without foundation. States comprise social relations!

My errors demand that “ontology should overcome logical analysis and embrace phenomenological understanding, moving to a semiotics of money” in which “the Janus-faced nature of money ought to be recast in terms of its emblematic significance as a ‘whole’” [Sgambati: 314]. This “significance” is as a value in itself [Sgambati: 307]; in its purchasing power [Sgambati: 315]; and its consequent liquidity, which the preoccupation with money of account renders “subterranean” in my work [Sgambati: 324].^{Footnote 9}

How is my conception of money as abstract value to be understood if not as a value in itself, as purchasing power and as liquidity? Sgambati actually quotes my frequent use of Simmel to emphasise this very point – “the value of things without the things themselves [Simmel 1978: 121]… “the value of things in pure abstraction” [Simmel 1978: 165]. As far as I can make sense of this part of the critique, Sgambati appears to say that, as I think that money is only nominal money of account, I really do not understand my own arguments.^{Footnote 10}

Introducing the assertion that I present the state as an extra-social metaphysical agency, Sgambati regrets that “unfortunately, this is not the place properly to engage with the content of Ingham’s history of money” [Sgambati: 319-320]. But he cannot resist and, with reference to a single source of “recent scholarship” [Kim Reference Kim2011], proceeds to cast doubt on my widely-accepted analysis of the development of capitalist credit money. He displays flimsy scholarship in accepting that London goldsmith’s receipts for gold deposits were the major prototype for modern bank notes. This “recent scholarship” implicitly reiterates the older tradition which, informed by the moribund metallist theory of money, assumed that bank notes must ultimately be based on an “intrinsic” commodity value. The role of the private mercantile monetary circuits and credit instruments in the early development of modern capitalist money is now well-established in a vast literature with which Sgambati is manifestly unfamiliar.^{Footnote 11}

The false assertion that I really believe that all value emanates from a “metaphysical state” enables Sgambati to contend that I am unaware of further “enormous contradictions” in my argument that modern capitalist money originated in the hybridisation of state currency and mercantile credit instruments [Sgambati: 325]. Again, it is a matter of properly understanding the role of money of account in the history of the relations of production of money. Embedded in and dependent upon uninterrupted flows of trade, mercantile credit circuits, often based on their own moneys of account, were chronically unstable [Boyer-Xambeu: 1994]. As is well-established, England’s more secure currency and money of account was eventually hybridised with and gave stability to private credit-money production in the Bank of England (1694), based on the monarch’s promise to repay his debt to the merchants. According to Braudel, after the fixing of the pound’s money of account by Elizabeth I in 1560-1561, it was “little short of a miracle” that the standard of value endured for over 300 years and without which there “was no easy credit, no security for those lending to the sovereign, no confidence in any contract” [Braudel Reference Braudel1984: 356].^{Footnote 12}

Repetition of the unjustified assertion that I adopt an extreme state theory in which money is entirely and exclusively produced by the state enables the spuriously contrived revelation of yet another self-contradiction: “we learn from Ingham that this is not really the case” [Sgambati: 326].^{Footnote 13} However, Sgambati then proceeds to employ my description of the hierarchy of assignable debt [Ingham Reference Ingham2004: 135] to support his argument that money as liquidity emanates not from the state but “from within debt relations (endogenously) via discounting, precisely as in a market for the commodity money” [Sgambati: 326-327, original emphasis].^{Footnote 14} The introduction of the term “endogenous” is significant. Sgambati’s almost impenetrable formulation is again unwittingly framed by orthodox economics—in this instance, in terms of the false antinomy of the old “exogenous-endogenous” debate. Despite all contrary evidence [see Ingham Reference Ingham2004: Chapters 1 and 2], he baselessly asserts that I really belong to the “exogenous” school (state “high-powered” money is paramount), but contradict myself by realising that money is produced “endogenously” in the banking system. However, my enterprise was to show that this is not a contradiction: following the hybridisation in the sixteenth and seventeenth centuries, the production of modern capitalist money has been shared by the state and private agencies.^{Footnote 15} Regardless of Sgambati’s contorted attempt to question its existence, there is a hierarchy of liquidity of monetary and financial assets that is structured in relation to state guarantee and support. As events since 2008 have shown yet again, the liquidity markets are ultimately dependent for their very survival on state liquidity.

Having exposed my “methodological fallacies and contradictions”, Sgambati sets out to establish “a novel sense of what money is about”—its “significance” in explicit contrast to its “nature” [Sgambati: 331]. This involves a further rebuttal: “while Ingham holds that “[m]oney cannot be said to exist without the simultaneous existence of a debt that it can discharge” [Ingham Reference Ingham2004: 12], I argue on the contrary that money cannot exist without the simultaneous existence of a debt that it will never discharge [Sgambati: 331]… that it will never redeem” [Sgambati: 334]. Space prevents contesting the details of the charge that I have consequently “failed to grasp the specificity of modern money”; but I cannot see how the basic elements of Sgambati’s analysis are so incompatible with my own. As my work is so frequently quoted with approval, this is perhaps not surprising. However, there is fundamental sociological error lurking in the sophistry employed to establish the distinctiveness of his analysis. It is not a matter of the existence of any actual debt that money will never discharge. Rather, as debts are cancelled by payment, a monetary system would cease to exist if new debts, denominated in money of account, were not continuously contracted [Ingham Reference Ingham2004; 2013; Reference Ingham2015].

Of course, it is perfectly legitimate for Sgambati to prefer to see money “conceptualised as a value (a metaphor, a gestalt) that institutes a certain way of experiencing and finalising the quid pro quo of exchange” [Sgambati: 314]. However, the attempted dismissal of my entire project and its understanding of ontology as the analysis of social phenomena’s historically located conditions of existence should not be considered to be a necessary precondition of this exercise. A phenomenological grasp of money as value, purchasing power and liquidity cannot supersede and replace an explanation of how these attributes are historically and sociologically constructed and maintained.