New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-06-24
NO CAUSE FOR ALARM ABOCT GOLD


have not repeatedly suffered before. The call
ing in of United States bonds for redemption
brings no new principle into operation. The
trouble, such as il is. arises from attempting
to carry on an extensive commercial IN
tercourse with the rest of the world with
an inadequate supply of the worlds money.
The nation collectively pays its debts abroad
in the same manner as individuals pay theirs
at home If an individual has to pay at a
certain time thousand dollars and has his
choice either to discount a note, part with IL
United States bond, sell some merchandise, or
pay cash which he has in bank, he will choose
that mode of payment which gives him most
profit or least loss. The same principle pre-
walls in the settlement of debts between ma
tons. Sometimes it happens to individuals
TO become insOlvent and have nothing 10 pay
with and frequently debts to foreigners come
INTO the same class. In that ease the debts
are not paid and the creditor Submits to his
loss, more or less cheerlully according to his
temperament In well regulated communities
however, the debts which are not paid when
due, or otherwise satisfactorily arranged, are
but small part of the whole. We assume, Ill
spite of the numerous defaults OF railroad cor
porations that we do not get any considerable
proportion of our imports for nothing.
During the last twelve months our liabilities
TO foreigners for produce and merchandise.
both Struggled and regularly imported, United
States bonds redeemed. interest on various
stocks bonds, and debts, frcight-mOney paid
to foreign ship-Owners, and the travelling cx-
Denses and subsistence of our citizens Ill
foreign parts, may perhaps have cached an
aggregate of $500. 00O, 600 in gold. The real
total can never be asccrtaincd. and i: il not
necessary that we should he able to state it..
1t is sufficient to know that our exports OF
produce and merchandise, salts al United
States bonds and other securities, our debts
PAYABLE at short notice, the interest Oh the
debts which foreigners owe us, and the
expenditures of foreign tourists in the United
States, added to shipments OF eighty or ninety
million dollars in gold and silver have not
more than suiced TO balance the account. III
we suppose that for the twelve months to
come all the other elements in the problem
remain the same as now, except those which
might be changed Dy the quantity Of gold cx-
ported being diminished Ono-hllf it will be an
interesting inquiry to consider how the cqua =
ton nay be preserved: One-iaf the gold ex-
ported in the fiscal year which en- 5 with this
month sill be about thirty million dollars.
which is nearly equal to q whole years pro-
duction of our gold mines.
There are "a score of influences besides the
premium on gold which might operate to in
crease the gold value of our exports and
diminish the gold value of the imports. Dull
ness in the markets of the world for English
has no
gold value Of our exports OF raw cotton about
fifteen iailliOn dollars as compared with last
wear. An excellent harvest in Europe has
made our exports of whoNt and flour worth
thirty million dollars less than they were last
wear. Finally the redemption of thirty million
dollars in United States bonds has added
twenty or twenty five million dollars to the
pavments we have been Obliged to make TO
foreigners. But let us suppose that next year
brings no better demand for or cotton and
wheat, and that another REDEMPTION of thirty
millions is made for the Sinking Fund in 1876.
What then!
IL il plain enough that another sixty million
dollars in gold cannot he had for expectation
the coming year without cmptying the Treas
ury. We shall therefore be obliged to settle
some other way. Let us suppose as a conse-
quencc of demand for gold 10 export COM
bined with scarcity of it ia the market. the
premium on gold ranges five per cent higher
than it has done this year. The effect
of the advance would be, other things
remaining the same, that five per cent
would be added to the currency cost Of
5000, 900, 600 Of Imports, while corresponding
addition would be made to the selling price
of 5000, 100000 OF exports. This would nat
urally cause an increase Of exports and de-
crease of imports sufficient in all probability
to restore the equilibrium and make up for
the deficiency in the exports of gold. The adj
vance in the gold premium would also dis
courage in the same degree the importation of
bonds and other securities and stimulate their
expectation.
The case supposed above is, Of course, en-
tirely hypothetical. 1t is impossible to tell
what will be the demand in foreign countries
six months hence for orr cotton, grain, and
provisions, bonds, securities and other cx-
ports and equally impossible to foresco what
quantities of foreign productions the United
States may import. We at thi, time a
strong demand for gold fer expectation and
very little gold accessible for that purpose
Hence we are compelled to infer that the
gold premium for the present has an
upward tendency, as We have from
time to time advised our readers since
last November. Gold has now advanced
six per cent above its price year ago. while