New-York tribune., 1876-07-25
COIN AS LEGAL TENDER.
SILVER INITIATION.


rvFITs 1T TEMPORARILY AT LEAST FOR USE AS
,toSEY-CAUsEs OF THE DECLINE IN SILVER.
,vnov THE REGULAR CORRESPONDENT OF THE TRBUNEl
W,sHINGToN, July 24-Prof. Jevons one of the
oblest English writers on currency, enumerates the
tIloyinp as the essential qualities of the material
Cor GOOD money: l. Utility of value 2. Portability;
Q Indestructbility; 4. Homogeneity; .. Diyisi-
b;,;t,,. q. Stability of value; z. Cognizabilty.
These he saws. are arranged in the order of their
;n,nortance. but adds: "When money, however,
zines IN serve as it will at future time, almost
I,s;velv os n measure and standard of value, the
sto,n of exchange, being one of perfected barter,
~ nronarties become a matter of Indifference, and
stobility Of value joined perhaps to portability, Is
,bo most important quality" The force OF these
rer,arks will not suppose, be denied by anybody
A currency that fuctuates IN value from day 10 ddy
r from, month TO month"; while 1t may perform I'M
rfctlv some of the functions of money-that Is, III
may he a medium of eXchange-fails, IN proportion
~ its fluctuations are great or sudden, to fulhL that
other and more important office OF money wlloh Is
serving as a measure standard of value. NO peo-
nle would submit for a moment to the use ol huc-
tuating yard-stlck or quart measure OF pouhu
weight. which serve respectively as measures oI
space volume and weight, and the VeAatloh anu
CONSTANT iniustice arising from the use of an unstable
measure of value is equally great, besides s'l'"-
lating and encouraging gambling and speculation
the g ins of which are taken from the productive
industry of the country
From the organization Of society to the present
time the precious metals have furnished the very
hest substances out of which to make money be-
cause they have possessed in higher degree than any
other known substances the seven properties which
Prof Jevons has enumerated. But if from any
cause one of the precious metals should lose the
properties of good money, or even one ot the most
important of them, it would to that extent ana so
long as an essential property was wanting, be uhh
for use as money. For instance gold and silver are
valuable because of their utility in the artisan as
money! If they were to lose that utility their value
would Immediately disappear. Ev@ if u part OF
their utility only should be destroyed If the demand
for their use in the arts should be reduced, then
part of their value would also be destroyed, and
they would be worth less than they now are for use
rs money, As stability of value is the most i'm
portant property of good material for money, tine
destruction of it in either OF the precious metals
makes that metal for the time at least, unfit for
use as money, and any attempt to Introduce or
maintain il i'm circulation must be attended with all
the evils which result from the of any other kind
Of an unstable currency.
For 100 years prior to 1873 and 1874 the i!uctua-
tions the relative values of gold and silver were
nos very great The discovery of gold iii California
aud Australia caused depreciation in It's value,
which, measured by the value If silver at the same
time, was greatest about 1S50-1S54 but was never
very sudden OF violent. When the first gold was
taken out of the California mines the market ratio
Of the value of gold to that OF silver was not as high
as sixteen to one, aud when the increased product
had had its full effect the ratio had not fallen to
fifteen TO one. During all this time therefore, from
-. Z IL. - hill
gold and silver both uotuetod in vouo, Tho o""svo
were less violent and were confined within smaller
limits than those of any other commodity. They
rossessed in greater degree than any other available
substances that stability of value when Is essential
for good money.
Since 1874, as every one knows, there has been
most remarkable decline in the value OF silver
when compared with that of gold, as well as with
other standard commodities, and instead OF now
being stable in value it is still uctudtinS from day
TO day and from week to week with continued
downward tendency BY these sudden and enoi-
nous changes in its value, silver has lost Tor the
time at least, of the most essential qualities OF
material for good money, and the result has been
great financial disasters in those countries Whi'h
have large silver circulation, unless they have
taken measures to protect themselves. Inda iid,
suffered most because it has an exclusively silver
cuIrencv and on account Of its remotoncsS from the
money centers of Europe it was not able to cast an
anchor TO windward when the storm approached.
In the Netherlands which also have the single s'l-
yer standard the force Of the shock was broken by
the suspension of silver coinage in 1870, when the
decline in the value of silver began to gain great
momentum and by the coinage of gold pieces 20 be
used in foreign trade. The Latin Union, which
maintains nominally the double standard, limits
every year the amount of silver to be coined in each
State of the Union and in the most important Of
them-Francc-the suspension Of specie payments
has prevented the effect Of the depreciation Of silver
from being fully felt.
Just at this time, when almost every other nation
in the world which has silver currency, either cX-
elusive or in connection with gold is seeking means
10 escape the disastrous effects of the decline IN the
value of silver and is either limiting the silver COIN
age or preparing to abandon it altogether, it is
prayely proposed in the Congress Of the United
States to begin the unlimited issue Of silver dollars
and because it is feared that they cannot be coined
fast enough in Mints it is also proposed TO pro-
vide for silver cOncerticaes which shall be legal
tender on the basis of the old silver dollar. The
House of Representatives recently, by an over
whelming majority, voted in favor OF the csse'l-
tal part of the proposition. In future letter may
point out some Of the inevitable results OF such c-
gislaton.
In view of the violent fluctuations in the value
of silver which make it at present unit material
for money, it becomes very important to know
whether this instability is to be permanent OF
only temporary The two causes generally assigned
for the decline in silver are its demOnetizatOn in
Germany and increased production in the United
States; but there is no doubt that there others
nearly or quite as important which are cooperating