The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1856-1888, 1873-11-15
MONEY THAT WILL STICK.

What is wanted says the Gazette, ARE
gold coins that cannot readily be exported" No
injury has come from having the f~ve-franc piece
circulate at three per cent. above its value, so
zone will come from Over-valuing the sovereign.
In fact, the gold coins must be brought here by
this means, or else we must resort to paper
money. in order to supply the drain of specie re-
s%ulting from the balance of trade being against
us. The gold was driven away by its deprecated
current value, and now it ought to be brought in
by initiating its value. And finally the importer
of sovereigns will not profit by the imitation, for
the cost of importation is about equal to the pro-
posed LIBERALIZATION. The GdzeHe's statement
of the foregoing reasons why gold coin should be
placed above its real par value, does not strike
us as an argument, for an argument pre-supposes
premises which are true in fact, on which a con-
clusion may rest. The most important ingre-
dent of money is its purchasing power, and in
this country which buys so largely abroad, the
value of 4 circulating medium which " cannot
readily be exported, would be lessened in exact
ratio with the diminution of its value for pur-
poses of expectation. When we come down to a
currency which is ~valueless for expectation, we
may as well resort to cobra, the coin of the
South Sea Islanders, BARRIERS checks, bakers
tickets, or any other conventional medium of
domestic barter.
If the balance of trade is against us, and our
credit is so poor that we can only buy for cash,
i is hard to see that this is a reason for import
ing coin at an exaggerated valuation, or for issu-
ing paper money without a specie basis. The
true way would seem rather to be, to import less,
spend less, and earn more, by increasing our pro-
auctions, instead of Gripping our resources still
more by attempting to regulate the value of
money, which of all things is the commodity
which trade itself regulates in the surest and
most natural mode. The Ga@eHe's statement
that business men think we can only supply our
selves with a circulating medium by initiating
gold or else by issuing paper money with or
without n specie basis, does not, as we think, do
Justice to the common-sense of intelligent men.
When Il Hawaiian Legislature votes for paper
money without specie basis, it will be when the
nation shall have sunk to Il lower level of hon
esty and intelligence than they have yet shown.
We have in n previous issue given our views in
favor of placing gold and silver at their intrinsic
value, and of making silver legal tender to q limit
Gu IQOuul I'LL y d6 Il AlOoLo "a NNANoAh OAN YIN ~
be retained here, as far as honestly can be done
after paying our debts and exhausting our borrow
ing power and credit. Until the propriety and ad-
vantage of this course be called in question, we
see no occasion for arguing further against the
proposed imitation. The depreciation of gold
sovereigns to S4.75, as was done in 1859, is no
ground for valuing them at S., but the result
shows merely the Importance of placing them
at their real par value.
The effect on government securities, which we
have said would result from initiating coin, is not
denied by the Gazette. The allegation that we
have suffered no loss by our deprecated silver
currency. is directly against the only object for
which the initiation is desired, which is, to replace
by gold coins this debased silver, with which
the country is flooded.
In regard to the profit which an importer of
sovereigns may make by this inflated valuation,
we do not suppose any one viii be called upon to
import them, for they viii come of their own
accord, and whoever has occasion to accept bills
OF exchange or letters Of credit from abroad, will
his money here which he VIII receive at its
par TO he paid for at its real par. To
illustrate. \ letter of credit in the sum of $500
will be supplied here by one hundred sovereigns,
and valued at s. each, and will be paid
abroad by something more than one hundred and
three sovereigns, at S4.S4 each. But the same
broker, if called on for $500 exchange to be
used abroad. must charge as much more for it as
the value of money paid to him here is less than
is abroad. unless he sees some other way of
making up the loss. Foreign exchange must rise
Is the domestic currency Is lessened in its intrinsic
1t is difficult to see that the great body of
producers and consumers will receive any benefit
this process.
As for increasing tho issue of silver certificates,
which bear no interest and merely represent coin
or which the government will give free storage,