Marx seeks to explain how the circulation of commodities and money leads to capital. To explain the start of the process, he writes out the formula showing money buying commodities in order to sell for more money (M-C-M) (247-48). Even more simply, for Marx, this process represents an exchange of money for more money. Marx describes this process, of money returning to the seller of the commodity, as a “reflux of money” (250). An example of this is if someone buys cotton for 100 pounds and resells it for 110 pounds (248, 251). It is the person who engages in the M-C-M form of exchange that Marx describes as a “capitalist” (254). This treatment of money is described by Marx as “self-valorization” (255). It is because money becomes more valuable basically independently of its relationship to any other commodity. Marx summarizes this process as “[b]uying in order to sell, or, more accurately, buying in order to sell dearer” (256).

Marx opens this chapter by stating, “The form of circulation within which money is transformed into capital contradicts all the previously developed laws bearing on the nature of