New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1876-04-03
SITTER SMALL COINS.

SITTER SMALL COINS.
The House has done a good thing, but
not in the best way. By vote OF l2Z
to 1OO it has passed the bill to substi-
tute silver coin for fractional currency, but
has also provided that trade dollars now worth
90 cents in gold, shall be equally with smaller
silver CONS, now worth about S4llO cents III
gold so far as they have any measurable value
and paper notes now worth $3.50 cents III
gold, legal tender for payment of sums not
exceeding $25. To have four legal tenders at
once, each differing and changing daily i'll rcla-
tive value, might be very instructive, but would
not be profitable or pleasant. Even while the
House, upon motion of Mr. Reagan, was
making this slip, Senator Jones, the chef
champion of silver, was urging i'll the Senate
the repeal of the existing act by which the
trade dollar Is now a legal tender for sums
not exceeding So, and explaining the trouble
which that act now causes i'll States where
silver small coins are used Apparently
the House majority did not know that the
only "dollar" now coined is the trade dollar,
at 81 IA 2sIoo to the standard ounce, the
coming rate of smaller silver coins being
81 "a 410sloooo to the standard ounce. and that
as long as people can pay debts with paper
worth only 81 cents on the dollar they are
not likely to pay coin worth 80 cents.
II is to be hoped that the Senate will ex-
punge these papabe errors from bill other
wise worthy of approval. The best thing to
be done would be to provide at once for the
retirement of all notes of smaller denomna-
ton than So, but as we now have In use, IN
Guiding fractional currency, $l02, 291,92l in
a. 10 hLely to tak
| step 30 brave and sensible. OF the Importance
of retiring the fractional currency, new and
conclusive proof is afforded III an elab-
crate article in The London Economist of March
| IS. The article aims to fortify the claims OF
the one-metal system of England, which
| Germany is trying to reach by decentralization
of silver, against the twO-meta system OF
| France, Italy, Switzerland, am GUM. In
cidentally it establishes fact great inter
est to Americans, namely, that the process OF
RESUMPTION in France will inevitably tend to
raise the price of silver. The argument Is that,
under the two-metal system, the Bank OF
| France has to meet singular difficulty 1t
holds about $3.50, 100000 in gold and 800,
| 600, 900 in silver coin, and if, attempting re-
sumption, it pays out gold coin, run upon
| the bank may at once be caused, for every
body will be tempted to realize the profit
obtainable by drawing out gold, and then
| selling il in open market for greater
nominal amount in silver This difficulty,
| The Economist thinks, can be met by
the Bank only by selling a large amount of
gold for silver, which would produce "a very
"material rise of silver as compared with
"gold.r That paper does not seem to perceive
Ton oil in, lnr0 ttnn MI
would have just tho same effect, whether the
gold should he sold by the Bank or by indi-
yiduals. But 1t is obviously right in main
tanning that return to specie payments III
France must cause such sales Of gold and pur-
chases of silver, either by tho Bank or by in
| diyiduals as to restore the relative value OF
| tho two metals There is no escape from the
| conclusion France cannot attempt demOne-
| tization OF silver until 1880 without consent
of other nations forming the Latin Union"
Moreover even The Economist comedies that the
change to one-metal system, which Ger
many is now attempting, is ian operation
Gin which many great nations should not en-
"gage cotemp0raneOusly.n As matter of
| fact, if Germany succeeds, it will thereby be
rendered the more difficult and apparently
impossible, for France to succeed in like
attempt for some years thereafter.
The United States, therefore, has rare
opportunity to anticipate great change,
inevitably to result from the operations of
| France, and to reap the profit for itself BY
bringing silver into use as far as possible
instead of paper, we buy when silver is
cheaper than ever before, and with certainty
that the enormous demand from France must
soon cooperate with our Use of the metal to
lift it to its normal standard of value. Con-
sidered merely as an investment, large pur-
chase of silver is good transaction if that
metal is certain soon to rise in value. But the
effect of the substitution Of silver for paper
upon retail prices is much more important
consideration. If while silver is cheap we
bring it into general use in retail dealings, and
abolish fractional currency, prices will gradu-
ally adjust themselves to any increase in the
demand for that metal. Silver goes to tho
meltng-pot only whom the melting-pot can