The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1856-1888, 1873-11-08
THE VALUE OF GOLD COIN.

sovereign a legal tender for I've dollars instead of
its real par value Of S4.S4. The present cur
rency consists mainly Of American silver half and
quarter dollars and dimes, French f~ve-franc
pieces, (Which are taken for one hundred cents
instead Of their par value Of about ninety-seven
centsl and Spanish and Peruvian quarters and
English shillings-all Of which pass for more
than they are worth.
The argument adduced for the proposed change
ia, that we have no mint and import our coin,
and therefore mus, place its current value a little
higher than It's real par, or it disappears from
the country. and constant reimportation of coin
becomes necessary. The example Of the United
States in lowering the intrinsic value Of their sill
yer coin Is cited. That was done in order to
keep sucn coin in circulation, and so, it is ar
gued, we ought TO over-value gold coin in order
to prevent its withdrawal from the country.
1t is true that We can easily bring ard retain
foreign coins here, if we pay more for them than
they can be sold for in those countries with
which we have commercial dealings. But it
seems TO us that this would be giving an un-
necessary advantage 10 those abroad who owe or
remit money here, and causing useless loss to
those here who owe or remit money abroad, be-
sides interposing 4 serious obstacle to the pro-
ductive energies Of the country, and lowering
the credit and value of government securities.
We import our coin, and the majority of civil
lied countries import their gold and silver, which
they coin at government expense. The English
Government returns in coin of nearly full intrinsic
value the gold bullion presented at the mint.
The object is to prevent private coinage, which
would result if any profit were made byit. There
is no apparent reason why coin should be with
drawn from the country because it is imported,
nor do we think that is the cause of its scarcity.
Every commercial country will have in circula-
ton all the money it requires for its exchanges,
unless temporary disturbing causes intervene.
If we owe abroad more than is owing us from
abroad, we must remit the balance in coin or its
equivalent if less, the balance is RENTED here,
unless those to whom it is due prefer to use it
abroad. If the balance is in our favor, some one
gains the benefit of the exchange, which means
the cost of importation, including freight, insur-
ance, and loss of interest. If we give more for
coin than our foreign debtors get for it at home,
money due us is not SO likely to stand to our
credit abroad, as it is TO be sent to its better
market here. The influx of coins received above
their real par will be slow if the GENERALIZATION
be too slight to make it profitable to ship coin,
but it will steadily go on, until only debased coin
will be found in the country. Every ship from
the United States viii come prepared to pay sill
yer coin of the lowered American standard,
which is payable there for small debts only, but
Is taken here for dues of any amount, Mt its fcti-
tious value. French vessels will leave French
f~ive-franc pieces for the same reason, and if we
give for British gold coin three per cent. more than
its intrinsic value, we shall have Il supply of it.
Gold coin must be sent abroad in payment of the
balance Of foreign debts, at its intrinsic value
abroad, and the difference between the nominal
and real values must be paid here. Travellers
may spend a little more ready cash here if they
can be made to think that they really get more
value in goods paid for in over-valued money.
Those who wish to transfer their money from the
country may gain by an initiation of our cur
rency but the country should not he taxed for
the benefit of either of these classes.
If producers and importers make any profits,
their returns must be correspondingly lowered
by paying foreign debts in coin of full value, and
receiving for domestic debts the coin at a Fictitious,
unreal value. This must iniare the agricultural
and commercial interests of the country Gov
eminent revenues, whether taken at the Custom
House or from internal sources, must be lessened
in value in the same ratio in which the coin is
over-rated, and the country is thereby made
poorer.
If gold Is the standard of value, silver becomes
an article of commerce., and rice UerSa. In the
former case, if silver is legal tender for limited
sums only, it may become necessary to debase the
coin, or in other words initiate its current value,
in order to keep it in circulation and prevent its
excessive use in the manufacture of useful and
ornamental articles. The gain resulting from the
rapidity with which small coin changes hands and
SO becomes n more efficient medium of exchange,
is greater than the indirect loss. But gold is not
thus efficient in rapidity of circulation, and it is
the standard of value in the principal commercial
countries of the world. Foreign debts must be
paid in gold, and this country must be the loser if
it gives more than the coin is worth.
y country will suffer most from such n measure
which like this imports its cloth, -four, and so
many other necessaries of life, all of which are
paid for in money of full value by products raised
here to be paid for in deprecated money. By
raising the nominal par above the real par the
purchasing value of the same amount of money is
proportionably lowered.
In taking the American silver half-dollar as our
monetary standard, and making it legal tender
for any amount, We must not expect foreign gold
coin in its place unless the gold currency receive
q corresponding imitation with the silver. But
which is wiser, to make gold our standard and
limit the amount for which silver shall be legal
tender, or to have a fictitious current value of
gold as we'll as silver? If only small debts were
payable in silver, and gold coin were placed at its
real par value, the quantity of gold coin required
for business purposes would be kept here, for
there would be no object in exporting it. ]
We are no richer for increasing our counters or
representatives of value. 1t is safer to regulate
foreign coins in accordance with the adjustments
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