The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-07-31

70 THE EDITOR OF THE HERALD

To THE EDITOR OF THE HERALD
have tried 80 often, through your columns ana
elsewhere to call the attention Of my countrymeR
to facts connected with the rate OF exchange and
the consequent price Of exportable produce, include
ing gold, without meeting With proper response.
that have become discouraged and have said and
written very little Of late the subject am re-
minded Of the anecdote related by the celebrated
Humboldt of a conversation with an intelligent
Indian In Mexico, who, being told that the earth
turned round and the sun was stationary, "Hughp'
said he, "do not see the sun rise and SET and
would not fall or II the earth turns overf" Here
were facts potent and unalsWerable to me uns
tutored mind Of the Indian, and he would make no
further investigation, but continues to this day to
assert that the rises and and that the earth
does not turn round.
The same persistent declaration Is made in the
newspapers daily and by orators and politicians In
relation to currency.
have asserted and proved over and over again
that 1t Ia the balance of debt due to Europe which
causes the high prices ofexporable articles and that
as gold is an exportable product OF our country
1t rises and falls in price with the demand for ship
ment like every other article Of export hold that
whatever may be the 'appearance' to the minds OF
casual or unscientiic persons there Is no other
cause that can produce the effects witnessing
every day in market; and here Will again group
few facts that should be kept In mind by all writer's
on subjects OF currency
During the time that our country was increasing
the issue of greenbacks and bank notes-and the In
crease was steady up to the present voumethe price
has varied and sunk from 2S0 to $780, The premium
on gold has in no been governed by the guam.
y OF our currency or the credit want OF credit OF
our government. No facts have been produced to
show that gold has been Influenced by currency but
all the facts show that the foreign demand takes
from US all the gold that Is produced In our country.
And this flow OF our gold at the high premium would
not take place and could not take place If there was
not u demand at this high price.
Suppose Congress should pass an an act prohibit.
| Ing the export of gold what would be the effect 2
Gold would accumulate and become drug in all our
centres OF rade no one would want it. 1t would be
| convenience prefer the greenback and bank note.
| But what would be further efiect9 BY stopping
the export OF gold the price OF all exporable articles
would Immediately rise in value and exchange would
advance from its present price OF lao tOpr0baby ITO
or 1870. Thus you would bring down the. price OF gold
TO the par of greenbacks and you would advance the
price IN the same proportion OF all farm produce that
| Is now expOrtable
| Gold has varied in price with all exportable pro-
duce and since 1852 the price of exchange and gold
| has been invariably the same. And, again, suppose
our foreign debt was paid and no foreign demand
| exchange fall to par or belowY The great law Of
supply and demand must not be ignored by inteli-
gent men, they Will be inclined to agree with the
| Indian that the sun, not the earth, moves
Prices are governed by demand and supply II
the demand for nour is greater than the supply nour
Will increase in price, and if the supply III excess
of the demand the price will fall. This rule is In
variable.
| AS long as a foreign demand shall continue the
price of exchange VIII remain high, and matter
Of course all the products Of the farm and the mine
| that command q market abroad VIII remain high.
In this connection we may remark that the constant
| complaints made by thoughtess persons about the
| evil effects OF dealings In the gold room Is not
founded upon public interest. Instead OF being In
furious to trade 1t must be advantageous TO all who
are dealers III exchange, for they can see from hour
| to hour the demand ana supply. Why not complain
of PUBLIC tea sales or of the monthly coal sales, or.
| market overt prices has always been held to be
| favorable to consumers or purchasers The price OF
exchange should always be tested in this way by the
great law OF supply ana demand. The variations by
these open sales win be much less than If left to tho
| monopolzing action OF large capitalists
| All attempts TO bring the rate Of exchange, the
high price OF farm produce and gold to the standard
| they were at before the war, will prove of avail
| until our great debt to Europe Is paid. The demand
from abroad is great and pressing that rything
that VIII sell In Europe Will be exported. No Secre-
tary Of the Treasury can reard or advance the pay
| ment Of great foreign debt, no local means by
legislation can influence IT, unless Congress shall en-
ACT prohibltory tariff upon all foreign products,
wealthy people from travelling or -reslgddapfaIeu
h}ilf20fsr per aiinui.
These Objectionable measures are the only ones
that government. can do to bring about the par OF
exchange and gold But, we may ask, why this ignor
ant wicked cry for ''specie paymentsr, Wnat
Speedy return to the par OF exchange or specie
Who IL injured by the exchange with Eur0peY Is
the farmer njuredS no. his produce brings iory per
cent more by IL. Is the manufacturers no or
mechanicy no. his interests are promoted. VINO,
then Is inuredS No one but the foreign manuiac-
turer and shall country be c0nvulsed In all Us
material interests to benefit the foreign manufacturer
OF silks and winesp The true interest OF our naton
IL to believe that the sun Ii stationary anu tnat al
though the earth moves 1t does not throw US on; and
that If look to the great laws OF our creation ana
being we shall see that we are controlled by equlva-
tents and that any attempt cOuneract their force
can only add to pain and perplexlty without any
| resulting advantage.
Peace, economy, industry and intelligence, without
| legislation will bring about for us III due time the
great advantages Of par of exchange
JONATHAN OLDBUCK.