The Hawaiian gazette., 1884-06-04

A GOLD law is regarded as a foregone
conclusion. 1t is apparently agreed. that
the Government Will supply the required
volume of United States gold, to replace
silver coin. The only point of difference
seems to be in regard to the amount Of
gold coin required for gold currency.
In the opinion of some. it will suffice to
redeem in gold, say 100000 of the Mex
can dollars, five franc pieces and trade
dollars, the latter being worth about 50
cents to the dollar, the Mexican dollar be-
| ing worth about SO cents and the five frame
pieces "a cents each. The same persons
propose that gold certificates for $780,
600, be made payable in silver coin, on de
mand, or at the holders option PAYABLE in
five years IN United States gold. The ex-
pense of now replacing the foreign silver
with United States gold, to this extent.
they estimate at about $4,000. They think
that there is in private hands some $780,
600 United States gold at present, and that
this with an importation by the Govern
ment of 100000 more would answer all
the purposes of a gold circulating medium,
and that the $4,000 of Hawaiian silver,
outside of the gold certificates, would be
absorbed and required as counters" in
retail business and small payments. Such
is the proposition as we understand it. 1t
is based on the assumption that there is
now in circulation, or boarded. about ST.
100000 in gold and silver coin.
We do not think that such plan would
be successful, and our reasons for this
view are these: The amount of silver coin
now deposited in the treasury against sill
yer certificates, is about SS50,00O. The
holders of these certificates would do the
same retail and small business with 1885,
900 in $40 United States gold pieces, as
they now DO with using certificates, none
OF which are less than for $40. The $780,
900 of gold which is boarded, or on deposit
by private individuals at the treasury is
further amount which is not used or re-
quired for counters The sum of those
amounts aof medal and not used for any trs,,s-
action uadcr $40, is S1,150,000 If the en-
tire amount of coin in the country be
regarded as Sl,S00,00O, the portion which.
is now in use for transactions under SO
under the requirements of the present
silver law las it is practically cannot be
over $650,O00 But, with a law reouir-
ing gold coin for all payments over 81.
it would be impossible to absorb this $3.50
V0O IN payments and transactions under
$500.
The only reasonably safe estimate of
the quantity Of silver coin which can be
used and kept for subsidiary purposes fun
der So is $350,000.
We should say then, that the amount of
United States gold which the proposed
gold law viii require to be introduced by
the Government for actual, present use.
and not depending ON gold certificates
payable in five years, would benot less
than SS5O,OOO, or enough to redeem all the
silver certificates now out. This, with the
100000 gold supposed to be already in
the country, would furnish circulation
Of 8, 10000 gold, leaving $3.50 coo in sill
yer
We see no necessity or safety in issuing
gold certificates payable in the futlre. The
danger would be great, that they would
result in causing premium to be placed
on gold. II this country is to be delivered
from its present incubus OF high exchange
by introducing gold law, the work must
be done once for all, and thoroughly. or
it might be better not to touch it.
The outlay Of 100000 for putting the
finances of the nation on a sound and per
manent gold basis is not to be considered
in comparison with the danger impending
from the present condition Of things.
Since writing the above, the Committee
on Currency are reported to have agreed
to recommend a SO gold law, and that the
Mexican and trade dollars and five franc
pieces be redeemed with United States
gold. This cannot accomplish the purpose.
We shall then have q rigid gold law. with
zoo much silver and not enough gold. The
silver viii certainly be kept in use and the