The advocate., 1892-06-22
MONETARY COMMISSION.
(CMttnued from first pags)

value az being controlled, or even much
influenced, by their annual supply, Is
absurd. That supply, which is one Of
tho controlling elements Of their value,
"a their entire stock, old and new, just as
Il really is with wheat, the only distinc-
tlon Icing that the annual supply is the
principle part of the stock Of wheat,
while It ls hardly an appreciable part Of
the stock Of the precious metals The
value OF the precious metals will be af-
fected not by the entire current produc-
ton, but by the surplus which enters the
circulation after consumption in the arts
and all losses by abrasion and accident
have been made good, and after supply
ing that new demand for money which
results from the growth Of population
and from the enlarged uses always fol-
lowing an increase of money. No cur
rent supply was ever yet sufficiently
great to affect the value Of the precious
metals except slowly and almost lmper-
ceptlbly. The signs for thefuture are
that the annual production will be de-
Acient rather than excessive.
Tooke (Hlstory Of Prices, volume 6,
page 239) says Of the influx Of the metals
after the discovery of America in 1902;
No rise OF prices can be discovered until 1870,
atty years latter the entry Of the SpaniardS into
mexico, and almost thirty years after the dis
COyery OF the POtod silver mine. The ultimate
range Of prices was not reached until 1910.
This will appear the more remarkable
when It Is considered that the worlds
stock Of gold and silver was exceedingly
small when America was discovered.
Chevalier estimates the stock In Europe
at that time at only Sl93OO0,OOO. 1t was
greater in Asia, where some Ruthori-
ties conjecture that IL may have been ST.,
500,OO0,0OO, But manlfestly the whole
stock was only q small fraction Of what
now exists, and consequently had far less
power than the present stock to resist the
disturbing influences Of extraordinary
additions. This steadiness OF value, re-
sulting from magnitude of stocks, will OF
course become still greater as stocks are
hereafter enlarged.
The processes by which supply affects
the value Of money and commodities are
essentially different An oversupply of
. commodity manlfests itself In a surplus
for which there is no effective demand,
and which must be carried as dead
weight, with the losses OF interest, stor-
ageD and insurance, and, in the case of
most commodities, Of waste and deterlor-
alton. The depressing effect on the mar
ket Of an oversupply Of commodities 10
out Of proportion to the actual percent
age Of the oversupply. But in the case
OF the metals used as money, whatever
the supply may be there 10 no part of 1t
which Is q surplus or dead weight. 1t is
all wanted and all wanted alike. There
ls an instant and ready use for the whole
Oft because 1t can be speedily coined
and put into the circulation on an equal
footing with the money already in eireu-
latiOn. Undoubtedly, IL the demand re-
mains the same, an increased supply Of
the metals will finally affect their value,
not Immediately, however, because not
visibly manifested by surplus, and at
last only In the same proportion as the
entire stock has been increased by the
increased supply. But the demand never
does and never can remain the same
when the production OF the metals Used
As money is so increased as to raise the