The progressive farmer. [volume] (Winston, N.C.) 1886-1904, 1891-01-13
course of trade or in settlement of trads

course of trade or in settlement of trad5
balances.
The present distributive share for the
United States, of the worlds money, is,
say, l,5OO,O 900 OOO-and that is not far
from our true, effective money volume
that is, 81 500, 100000 is now required in
this country to maintain prices of COM
moditie5 internati 1nally dealt in under the
conditions Of trade, including tariffs, now
prevailing, at the worlds level of prices.
This being admitted, it follows that, if
Dur money volume were made less, the
same conditions of trade remaining, prices
would fail IN this country and money
would flow here to restore the equilibrium
On the other hand, if our money volume
were SO increased as to give us more than
our distributive share of the worlds
money, and thereby raise prices of COM
modities subject to international trade,
above the international level of prices of
such commodities, then money would be-
gin to leave US, and would continue to
leave US till the equilibrium was restored;
and the part of our money volume that
would go from US would be that part re-
CURED to settle international balances,
which, for Europe, at any rate, would be
gold.
With these principles in view, it is clear
that, if the free coinage of silver should
result n providing us, in time, with our
full distribugive share Of the worlds
money, without any gold, then gold would
undoubtedly be displaced. But gold
could not go to a premium and 60 out of
use until it had been substantially all dis
placed, for if it did we would be left
without our share of the worlds money.
and gold would come here to fill the void.
That is, if your present effective money
volume consists of $3.50, 900, 900 of gold,
$3.50, 900 600 of silver and $40O, 900, 600
Of paper, and if the opening of our minis
would send gold to a premium at once, as
has been predic ed, and take it out of cir
culation or out of our money volume,
then we would have left but the $3.50,
00O,0 1000 of silver and $500, 600. OC0 of
paper, or, say, $3.50, 600. 900 in all, while
$1,5OuO,O0O is required to maintan the
level OF prices in this country at the inter-
national level. Under such a state Of
things, gold would certainly pour into
this country to fill the void that would be
created by such a change in the money
volume. Therefore, not until silver has
been choined in such quantity as, first, to
take the place of bank )tes retired, and,
second, to supply the needs of money of
our increasing population and expanding
business, can it begin to ex pei gold; and
the parity of the two metals would not
De ~brOken-could not be permanently
broken-until silver had been coined in
sufi 3ient volume to displace gold entirely,
or su1 stantially all of it had been dis
placed.
Now, how much new money is req 1ired
to take the place of cancelled bank notes
and meet tie demands of increased popu-
lation, growing wealth and expanding
business2
There were cancelled, during the last
fiscal year, $22, 500 900 Of bank notes. An
increase of 81 per cent. in our money
volume would probably no more than
keep up with increasing population and
wealth, and maintain the present range
of prices; or, say, $50 500, 900 for this
purpose. To answer these two require
ments, then, would take $75, 600, 900 Of
the new silver money. This is more than
half of the silver product of the world.
The arts take annually about $685. 900 900
of silver. Hence il we should coin the
entire silver product of the world, after
deducting that consumed in the arts, we
would not be adding to our money vol
ume greatly more than needed to supply
business activities on the present rang of
prices, and it would take many years, in
any event, to disturb or expel much of
our gold.
But no one would presume that the
rest of the world-China and India
would take no silver if our minis were
open to free coinage. They would IN
doubtedly continue to taxi large quantities
of silver, and the problem would likely
still be, where to get silver enough to
maintain q money supply on an even ratio
with the increase Of popu'ation and bust
ness.-A. j. Warner, IN MotiOnG! VIeoO.