Omaha daily bee., 1891-05-17
The REAL NATURE OF MONEY
How It Succeeded the Interchange Of
Products Of Labor.
RELATIVE VALUE OF GOLD AND SILVER.
Amount OF Money Required by
the Business OF the World
and How il is
Regulated.
RELATIVE VALUE OF GOLD AND SILVER.
BelfOrd's Magazine for Ndv.

practical comprehension OF what money Is in
It's essential nature. Let us study 1t in the
past, for the past can in all things teach us.
Since man began TO produce anything by
his skill or industry, he has been in the habit
OF exchanging those products OF his labor
which he did not need for his use for some
portions, more or less great of such things as
other men by their skill and industry were
able to produce beyond their own needs, but
differing in kind from his own. These pro
ducts were originally exchanged for each
other. But 1t came about in the evolution OF
Ideas, manners and customs OF all people suf-
fciently advanced to be called civilized or
semi-civiized, that some one product OF hui
man skill or industry possessed quicker and
moro universal exchangeability than any
other. For it in certain quantities all men
became willing to exchange whatever they
had to exchange, whether the products of
their labor or their labor service.
At different periods and among different
peoples, this one peculiar thing was not con-
stantly and everywhere the same. At one
time or place it had been beaver skin; at
another time or nlace, shells or beads, at an
other, cattle or slaves; at another, iron, cop
per or brass; at another, silver or gold. Now,
by reason Of this peculiar exchangeability,
the price or exchangeable power Of all other
commodities came to be expressed by the
quantity of this one peculiar commodity for
which they could be exchanged. 1t was nat
ural that name should be attached to this
peculiar thing, and that name was money.
The books will give all the reasons which
led to the natural selection of these various
things designated as money. | shall content
myself with one or two. First, and funda.
mentally, they were such things in their re-
spective times and places as woulu univer-
sally minister TO the comfort or pleasure of
those who possessed them Second, they
were in their respective times and places rel
atively the most convenient, not only for the
purposes of universal exchange, but for pres
ervation against further needs. 1t has been
by the FREQ play OF human choice ending in
q concensus of action, that money has thus
been evolved, never by conventional agree
ments made in advance.
In modern times, among civilized ma
tions, gold and silver have super
seded all other commodities as money,
but they do not differ in their essential char
acteristics of desireablencss in themselves
(either for utility or ornamenD from those
other commodities which in ruder times,
among more primitive people were equally
entitled to the appellation money.
1t does not need moments thought to sat
isfy us that 1t was by a true survival of the
nttest that gold and silver finally obtained
universal recognition as money, and super
seded all other forms Of it.
Bear skins were universally desired, both
for comfort and ornament; but too long kept
they are liable to moth and mildew, and their
value was thus diminished or destroyed.
Cattle were liable TO disease or death, and
were expensive to care for. Finally, copper,
iron and brass were too easily produced and
united in themselves the disadvantage of
bulk, as well as weight, with small value.
Silver and gold are not easily destroyed.
They are almost infinitely divisible; their
purity or iincneSs is readily determined AS
society has developed, their desirability for
use and ornament has not diminished. Since
they are practically indestructible, easily
hidden and guarded, they of all things are
the most convenient for their possessor to
keep for such future needs of exchange for
other things as he ay then desire.
With this general statement thus made, 1
will ask and answer a few questions, which
will lead by the shortest route to the end of
my subject.
Question. Would not some other thing
than silver or gold have been Just as useful,
<iust as exchangeable and just as much enti-
tlod to the name of money, If these had not
been selected.
Answer. Yes, perhaps so. But 1t is sufi-
Gent that society has adopted these two, and
In such matter the individual may well go
with the crowd.
Q. Ought there not to be more money in
circulationl Is there now enough for the
wants of tradel
A. The question cannot be answered by
either an absolute YES or no. In the begin
ming, If in such u matter there could be a
definite point Of beginning the quantity
would have been Of no consequence, or, in
the words of Bonamy Price, "any would
have been enough, because the price of things
would have become related to the volume of
money, whether that volume were great or
small; and once established in their fair re-
lation to each other through their common
relation to money. it would make
no difference whether the price was
what we would now call high or
low. But the only ideal money would in
crease in ratio commensurate to the in
crease of things to DO exchanged, minus the
quickness of exchange which time might
bring"
IL is not probable that either gold or silver
or both in use together as the bimetallists
desire, would form the ideal money. In this
sublunary sphere the ideal is seldom
reached.
am not aware of any we'll ascertained
data by which tho question, Is there money
enough! can be definitely answered, There
has been an increase in the volume within
the last fifteen years much greater ratio of
increase in the volume of things to be ex-
changed. There are those who affirm that
tuere Is hot uall enough, tnat tne price OF
things has become related to the existing
stock and that with the economies that have
been secured and will no doubt be further
gained in the use of money, there need be no
present fear Of proper supply. A reason
able amount of good money is better than a
larger supply of an inferior kind, since
sither has TO be bought and paid for by hon
est labor.
Q,-Would silver and gold be now rightly
entitled to the name of money if they were
not coined at the mint, ana the value of the
coin determined by law.
"A. Yes. They would exchange as freely
as now, and would then, as now, be entitled
In every sense but a technical legal one to the
name of money. The coinage does not give
the metal any value that the metal did not
before possess, The law determines the fine
ness and quantity of recognized value which
given coin shall contain; gives a name to
the various coins respectively and therefore
treats of them rs money, not recognizing in
its phraseology gold and silver in the torn of
bullion as money. But rs bullion is as read
lily exchanged, and lin international trade)
more TO be desired than com, and us the value
OF the coin derives its power from the uuan-
tity and tineness of the metal it contains,
and not from tho stamp of tho government
machine ] repeat that, essentially, gold and
silver bullion are as much entitled TO the
name of money before being coined into dol
lars, or sovereigns, or francs, as afterward.
know that here is vital point of dispute:
that because the law in speaking of money
fraatS only of what n had stat,nai as Such