St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1885-03-02
does not to them seem to be sustained by
facts or sound reasoning. The total volume
of currency in the United States outside Of
gold is less than $3.50, 900, 1000. It

facts or sound reasoning. The total volume
of currency in the United States outside Of
gold is less than s750,O00,000. It
is believed to be a princi-
pie of economy perfectly well
settled that if the volume of $750,000, 900 is
not sufficient in itself to maintain the prices
in this country at a level at International
prices,then gold will come here and stay here in
sufficient amount to make, with the volume
already in circulation, what will constitute
our distributive share of the worlds money
as determined by our international trade
that $3.50, 600, 900 is not sufficient volume
to maintain prices
AT THE WORLDS LEVEL
of prices, as evinced by the fact that $780,
100000 of gold, considerable part of which,
at least, is in circulation either ia the form
of coin or certificates, now stays here, and it
will 60 away only when the prices become
lower elsewhere than they are here. 1t is
believed, therefore, that no such crisis as has
been foreboded can ever take
place in the United States under the
existing conditions. 1t is not
| believed to be in the power of all the banks
| in the country, even if they were so disposed,
to take gold out of circulation and hold it for
| any length of time at a premium. They
must first lock up the worlds money and
arrest the worlds commerce. Nor can paper
or silver or silver certificates now in circu-
lation side by side with gold expel gold. The
gold can be expelled by forcing into circu-
ation, in addition to $3.50, 900, 900, either sill
yer or paper equal to the entire volume of
gold now in circulation. In that manner,
under Gresham's law, gold might be ex-
PEELED, and probably would be.
1t is doubtless true too that if the popula-
ton and wealth of this country were at Il
standstill then the continued coinage of
silver in sufficient volume would in time
expel gold from circulation, but as long as
the population and wealth go en- increasing
then the conditions of the problem are
changed. In fact in order to preserve
STABLE RATIO
between the money volume and population
and wealth an annual income not less
than forty millions of currency of a
sole kind is required. In other words
the increase of population and wealth
calls for the addition to our circulation of at
least $40, 900, 900 year. If while these con-
ditions continue silver is coined at the rate
only of S2S, 900, 600 year there is left still
considerable void to be filed with gold. This
is reason why gold has increased in the
country steadily since the act of 1878 was
passed and why gold has increased by nearly
S14, 1000, 900 during the last year, and is now
increasing at rate of nearly s1,000,000 a
! month Notwithstanding the depres-
sion of business in the country, and
as matter of fact there is
to-day more gold in the country than there
ever was before in its whole history. An
other fact is that $50, 900, 600 of gold in the
treasury was put there in exchange for
SILVER CERTIFICATES.
The immediate effect of stopping the coinage
of silver must necessarily be to lower the
price of silver bullion and gradually to APP
preciatc the value of gold the world over.
The difficulties in the way of establishing an
intern ational ratio so much desired, or Of q
readiustment of the relative value to gold
here, would thereby be increased. How
it is possible for such things to
take place as was predicted in the last para =
graph of the letter tbs difficult to see. Gold
is to be withdrawn to its boarding places
followed by an unprecedented contraction in
the actual volume of our currency. Such a
contraction it has been shown must be fol-
lowed by
GREAT FALL OF PRICES.
What, would not gold flow here as tides
fowl Surely it would come as fast as the
ships could bring it. What would those who
have been boarding gold do with it then
Labor, the letter says, which is already greatly
depressed, would suffer still further depres-
sion by the scaling down of the purchasing
i,,. ID Inl1 ut he
hand of toll. Here, in one sentence, we
have gold boarded, unprecedented contrac-
ton, fall of prices, and the scaling down of
the purchasing power of the dollar; that Is,
when these impending calamities come,
prices are to fall. Everything becomes
cheaper aud money becomes less valuable at
the same time-that is, both sides Of the
balance go down together. Usually one side
goes up as the other goes down. Usually as
commodities become cheaper, money be-
comes relatively dearer, and vice versa.
Usually contraction of the money volume
RESULTS IN A RISE
in the value of money and not in a fall. The
contradictions involved in this paragraph of
the letter are hardly calculated to carry con-
viction to those, who have ever studied
money questions at all, or TO awaken in them
any sense of alarm at our approaching ca
lamities from such causes. In one thing all
will agree, and that is in the Importance to
the whole country, and especially TO the
laboring classes now struggling with want
of the revival of business and the reaction
OF prosperity. The one condition essential
to this is to stop contraction of currency. No
country ever did thrive and never can
while its money is undergoing con-
traction. Business cannot be secured,
when its foundation is constantly giving
way. Stability in favor of money is the one
esse initial requisite to safe and prosperous
business. What is the monetary condition
Of the world to-dayi Are We not brought
face to face with the startling fact that the
gold production of the world has fallen be-
low its consumption in arts, and that there
is no probability of any new gold for money
supply for centuries to come. With this
condition of things as to gold, shut of silver,
as is nov proposed, and where is
THE MONEY SUPPLY,
even for keeping up the stock Of coin now in
the hands of the world to come froml As
aggrayating this state of affairs in this country
paper currency is undergoing contraction
by the surrender of bank notes. Ii this state
OF things is to last, upon what is there to
build the hope of returning prosperity
In the last three years, according TO Lon
don economist, prices have fallen more than
80 per cent. That is, money has appre-
ciated in that ratio. In quarter of a cen-
fury following the gold discoveries the Cali
fornia aud Australia stock OF precious metals
in use as money was increased by nearly 40
per cent The trade and commerce of Great
Britain and the United States during the
same period increased more than four fold
and the wealth proportionally.
Reverse these conditions. Shut off all the
money supply and what room for hope is
there for mankind except for those whose in