The Iowa plain dealer. [volume] (New Oregon, Howard County, Iowa) 1867-1895, 1885-05-28
Redemption Of Gold and Silver
Money.

A correspondent says: "in recent
issue Of The american / find q para
graph in which you say:
"Thele is reason to believe that
before the end Of the war, which TO
all appearances Russia is Bbout to
be engaged in, she will be obliged to
issue paper money. Not notes re-
deemable in gold and silver
money, but paper money, re-
deemable only, as money made OF
gold or silver is redeemed, by being
made receivable in payments Of all
debts and dues"
please state what you mean by
gold and silver being redeemed. /
have always been taught and believ-
ed that no redemption Of gold or
eilver money ever takes place. or Is
In any way necessary. Please ex-
plain your position In regard to re-
demption Of money"
The ANSWER: Money made OF gold
and silver, being an unlimited legal
tender by law, Is thus clothed with
all the power and capability Of use,
as money, that law can confer; In
other words it is perfect fat money,
while money or notes not possessed
of legal tender power, but made re-
deemable or exchangeable for fiat
money, on demand, is mainly depend
ent for its value upon the faith Of
those who use it, that it will be SO
redeemed whenever.they desire that
it shall be.
. The value Of full (legal tender (fiat
money as compared with other
things, regardless Of the intrinsic
worth OF the material OF which it is
made, is dependent upon the demand
there is for it, and the supply
OF it as compared with the demand.
This fact is fully illustrated in the
case of the demand notes." Nhe first
greenbacks issueD which, from the
time they were made full legal ten
der money. were always worth their
face in money made Of gold, except
when they were worth premium in
it, and yet from 1862 until 1879 Gov
ernment refused to give either gold
or silver in exchange Tor them. Being
O full legal tender, and there being
les of them than the needs of the
country required, they were not ouly
receivable but were gladly received
in payment OF all debts and dues.
and were thus redeemed, just as
money made from gold or silver must
be redeemed In order to be Of any
value as money.
The history Of the demand notes
from the time they were made full
legal tender, was substantially re-
pcated in the case Of the later issue
OF greenbacks, which from the time
that Secretary Sherman issued his
decree, in violation Of law, directing
that they should be received at par
for all dues to the government, have
constantly been worth at least their
face in gold.
This was not because Of the so
called specie resumption, for even il
redemption In gold were provided
for by law, which is not the case, re-
demptiop in New York alone, as now
provided for, would be practically
worthless to the man in Kansas, or
any other place hundreds Of miles
away, but because they are every
where, within the United States,
made redeenahle at par, In use, by
being receivable In payment Of oil
dehta and inee s.--t
money Is and must be in order to be
worth par. The history OF the Trade
Dollar emphatioally illustrates this
point.
What even at the best. would gold
redemption OF greenbacks be worth
to q hungry man, provided that
when he had got the gold he could
not induce any one to redeem 1t by
taking it In exchange for the needed
dinner.
It is by being taken in exchange
for things needed that money is
truly redeemed, and any money that
will not command this kind OF re-
demption is irredeemable in the
highest sense of the term, and verify
worthless, while any kind Of money
that will command such redemption
ut par has no need OF redemption in
any other kind Of money.
That law can, by its provisions and
requirements, make one kind OF
money more valuacle than another,
is clearly proved hy the history of
the greenhacks known Us demand
notes." which, from the time they
were made full legal tender were
ut or above par in gold, while the
later issue Of greenbacks with the
"except" printed on them were al
ways below par, until John Sher-
mans edict nullifled the except"
when they ut once rose to par in
, gold and other full fiat money.
In illustration OF this principle
Suppose Congress should do as 1t
ought, by depriving gold money Of
all fiat value, leaving it to rest spe-
clllcaliy and wholly upon Its COM
modify worth, and provide that
from tho tirst day Of January. 1886
greenbacks only should be u legal
tender, and thar all payments to the
government must thereafter be
i made In greebacks, Is there any one
green enough to believe than under
such conditions gold money would
for even u week remain ut par in the
despised greenbacks, unless thee
was d monstrOus increase in the
amount of the latter issued! Does
any one beliye that the advocates q
intrinsic money dare subject thei
theories to such an ordeal?
Our nations experience with fnl
legal tender gleenhacks proves. b.
yond ali question, that such nnn".
wisely limited III amount issneh. ha
!. permanent. certain and ahun'ian
redemption basis III tho use praviir'
for II by law, that rrn!ar- il S;,sti
basis for it Il useless superiority, AZ
makes 1t superior 10 4e.a q, si's'
7 as we'll as any paper money 's''i"4a.
emf for its value. llpon Il .p..cr it