The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1890-11-30
EXPORTS PAY FOR IMPORTS.

Mr.. ScHURz has stated what is essential
in the development of our commerce in this
succipct way: i
THAT we should have something to sell.
2-That we should adapt the goods we wish
to sell to the requirements and tastes of those
to whom we wish to sell them.
3-That we should be able to sell our goods
as cheaply as goods of the same kind and
quality as sold by other people in the same
market.
4-That il we sell to foreign nations we must
be willing to buy from them. one-sided inter
national trade being contradiction in itself.
We suppose the first three of these prop
ositions will not be disputed. There are,
however, persons who question the correct
ness of the fourth
There exists with some a belief that it
would be possible for people of this country
to sell for gold only; that is, to sell to the
people of other nations without in turn
buying anything from them.
This medieval superstition is quite up
set when we remember that no nation has
coin enough to pay in gold or silver coin
for the imports of single year, much less
those of centuries.
Moreover, in this country especially,
there is no profit when gold is imported in
payment for goods. An example will make
this clear Wheat is worth so cents a
bushel both here and abroad. If we sell
bushel of wheat in Liverpool we get 80
cents for it, as we get here. But 80 cents
will purchase twelve pounds of sugar in
| Liverpool and only six pounds here; and a
like proportion holds in the case of numer-
Gus articles. If we bring back the money
it will be worth no more here than the
wheat was worth-there is no profit on the
exchange. And so, barring the tariff, we
should bring the sugar.
| A little study of the workings of interna-
tloual trade removes several false notions
that nearly every person has to begin with.
In the first place, the importation of goods
is not carried on by the same set of men
who carry on the export trade and the
goods imported are not always sent to the
place whence the Importation comes.
The money in use between different
countries consists of bills of exchange or
drafts, which the sender of each cargo
writes out and sells to a broker. If A
sends to London cargo of wheat, he sells
toa broker, B, this bill drawn on C, to whom
the wheat has been sent: b.
NEW YORK, Nov. 90, lS90-Exchange fol
81, o00-Sixty days after sight pay to B one
thousand pounds sterling for value received
charge the same to account of A.
To C, London, England.
The broker B, pays somewhat less
than 81, 900 for the bill, then sends it to his
agent in London to collect the amount from
C.
Now, D, of London sends cargo of hard
ware into this country to e. VINO does no
send cash back to D, but buys bill from a
broker and sends this bill in payment fol-
the cargo of hardware he receives d re
broker in London.
The broker B, by selling this bill to E
which we will suppose is 1000 in value
has collected the LOCO due, him in LONDON
, and he notifies his London agent to pay L
this amount when the latter presents tn
bill of exchange for it.
Thus, the American does not receive hi
pay in English pounds for what he sends t
England, but in American dollars: and tn
English exporter receives his pay il
English pounds, while the brokers VIII
effect the exchange charge certain com
. mission for their labor, and clear the trans
! actions with perhaps slight final excharg
: of gold when the transactions dc not exactl
# balance.
Il Now, a glance at our custom house table
; of exports and imports show that these tw
, items about balance each other. Thus W
have no other conclusion than that export
n are the pay for imports.