Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1882-02-02
TIE EXPORT OF GOLD.

etdteu W weaken the markets., Anu IL 10
significant that this is one of the agencies
which the journalistic cappers for the
gamblers of San Francisco are just now
endeavoring to naturalize upon the Pacific
coast. Wheat gambling tends to obstruct
the free transfer of products. 1t often
causes the locking up of large quantities
of wheat and other produce. 1t unsettles
values, encourages initiation, and in many
ways hastens commercial crises. The folly
| and obstinacy of Congress in regard to the
silver question has been another infuen-
tial factor in the situation. It has been
proved by careful comparison of prices
for several years past that during the last
two years they have been rising in way
which can only be explained by the as
sumption that an initiation of the currency
has taken place. The issue of silver dol
lars and silver certificates fully accounts
for this, for whenever the volume Of cur
rency is in excess of the needs ofsa. country,
it's value begins to decline, and this decline
is marked by rise in prices. But this is
not the sole cause Of the commercial trou-
bles which have been gradually increasing
for some time past.
As usual when the prospects appear good
for trade, there is tendency to discount
them. and at the same time there is dis
position TO overdo production. Now in a
country which has of its own free will
shut itself cut from foreign markets by
system of Protection, over. production
must always be more easily brought about
than in countries which have the whole
world tor their market. Protection, too,
may overreach itself, and this also has
been the case with many of our n,anufact-
urers. Prosperity and the tariff have en-
couraged them to raise their prices so
high that in many instances it has become
possible to foreign manufacturers to i'm
port goods to the United States in spite of
the tariff, and thus to compete successfully
with American makers. And as Ameri-
can manufactures are excluded from for
eign markets they are the less able to
stand competition at home, and thus the
manufacturers find themselves exposed to
losses, not merely despite, but actually
because of, the system which they thought
had secured the home field to them com.
pletely. The increase of imports of late
shows thst this is no fanciful cause of appre-
hension, while the corresponding decrease
of exports shows how much speculation
has done to paralyzs commerce.
It is possible that the French panic may
have a SOLDERING effect even in this country.
Certainly it is to be hoped SO, for the con-
ditions at present are by no means reassur-
ing. Speculation and over production, as
sisted by currency initiation and Protection,
are capable of bringing about very serious
results in comparatively brief period. If
to these agencies is added foreign fnan-
cial stringency SO great as to set up steady
drain of gold to Europe, we shall have a
general condition of things requiring the
most careful treatment. And it must be
confessed that it seems useless to look to
Congress for any help or relief in the prem
Uses. The silver coinage still goes on at
the rate of two million dollars month,
the silver certificates are still issued to
swell the already redundant currency, and
tariff reform seems as far as ever from re-
alization. Now if the drain of gold con-
tinues for any length of time we are liable
to have the silver question brought to the
front with startling emphasis, and we may
be compelled to determine without further
delay whether we are prepared to give up
gold altogether, and fall back upon the
currency of China and Hindostan. For
with the exchanges against us, with the
paralysis of over-production affecting US,
and with an Inferior currency ready to our
hands, it will not require very long con-
tinued pressure to bring us down to the
single silver standard.
The French panic has happened at bad
time for US, though if the warning is seri-
ously accepted it may be the means of
postponing similar misfortune on this
side of the water. But so long as the
present drawbacks to the freedom of COM
merce are permitted to exist we shall al
ways labor under disadvantages. We are
in fact heavily handicapped by the meas
ures which were adopted under the de-
fusion that they would give US special ad-
vantages, and SO long as we continue to pin
our faith upon that delusion we shall of
course suffer from those evils. If the cur
rency were in thoroughly healthy condi-
ton, indeed. slight drain of gold would
do more good than harm, by relieving the
country of the initiation which now upholds
prices, by bringing them down to their
normal level, and by discouraging specula-
ton. But as it is we are continually put
ting in silver where the gold is taken out,
and if this process is maintained long
enough we shall some day have got rid of
all the gold, and retain nothing but silver.
That is the tendency of our financial
policy. While the exchanges and trade
were favorable and everything went swim
mingly, nobody noticed or paid attention
to this state of things but now that re-
verses have set in, and trade is out of gear,
and the exchanges are against US, and gold
is beginning to flow out, it will be impos-
sible to preserve the attitude of indiffer.
ence, and it will become imperatively
necessary that the country should make up
its mind in regard to that currency ques-
ton which Congress appears afraid to
touch, even for the purpose of abatin the
most evident mischief.
how THE GEAR TRAVELS.
Nihilism has compelled the Gar to re-
linquish many of the comforts and con.
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