The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1893-05-21

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can now see this was business foresight and an
understanding of economic laws; but in the
mountain region little heed was given to the
i question until the price of silver threatened to
| cripple mining, and then 1t was taken up with
out any careful examination into the causes OF
the trouble, and hence there was misappre-
/ hension as 10 remedies. We have heard
1t was only conspiracy OF bankers
and money lenders; that there could not
be any such thing as an overproduction of
silver; that the law made the Value of money
and only free coinage was needed; that the
price of commodities had fallen with. and be-
cause of the fail of the price OF silver: that
really silver had not fallen in purchasing
power, but gold had appreciated 40 per cent;
| that the act of 1873 was the greatest crime of
the world and could not be atoned in ten gener
atoms, and that it had cut in two the money of
i the people and doubled their debts and as q
result of this crime and the price OF silver peo-
pie had become poor and their farms were
mortgaged and that with free coinage pros
perily would return, labor be employed, and all
/ the evils with which we are afflicted removed.
| There is neither space nor need to answer all
these things in detail That supply and demand
control prices is conceded by all as
to commodities, but it is denied as to tom
modify that is coined and made legal tender.
/ If we go back to our hunter who had spare
bear skin to exchange we can see he had an
opportunity TO learn much about prices. he
found 1--WE VIII Suppose) that his tribe had all
the bear skins they wanted and he could only
! year he took fiue spare bear skins and the rest
of the tribe had failed to take any, but many
wanted one. and they had taken a large num-
Der of small skins OF which our hunter could
get several for each bear skin. He therefore
found that one skin was an over supply of the
market one year. and five an under supply the
next year. and that when he had the larger
supply he got the larger price. AS result he
found he could not tell what was supply I'M
less he knew the demand; that the two were
co-relatives, could not be considered separately
Il 2 rIad hat II
learned is true OF all time and OF
all things, whether it be of wheat, silver
coined or uncoined, gold or diamonds. vi
the qualities required of metal
for the purposes OF money, rarity is
one named by all writer's This necessarily re-
fers to quantity, and if law fixes the value of
money, the quantity Of the metal would be of
no Importance, for the quantity and nominal
value of the coins would contro, and the cheap
metal would be as good as the dearer, and the
silver question could be settled by stamping
4i2I2 grains of silver 90 per cent. fine with the
stamp of the double eagle and making 1t legal
tender for 40. If We imagine time when
gold and silver were not coined, one who had
go d dust would need scales, or nave TO go TO
some one who had them to find out what weight
he was giving or getting, and this was done in
California not many years ago. The miners
knew the general range OF hneness and the
scales did the rest of the work of coinage-they
gave the weight Before government coin
age we assume some silverSmilh melted
the bullion into pieces of definite
certify the weight and as name is only de-
scriptive he might as well call 4l2l2 grains a
dollar as by any other name and the word
dollar would then II san ARIA grains of sill
yer 80 per cent fine. This was imperfect coin
/ age and would not be credited beyond where
the silversmth was known, anG governments
took up the coinage to give greater faith to the
stamp and by more elaborate stamp prevent
mutilaton and counterfeiting. Our govern
1nent stamp certiffes the weight and tinenesS
, and this is credited anywhere in the United
States. and our word dollar meaus a certain
weight so certified. Before IL is coined we call
/ the metal silver, and after coming we call it
/ dollar and this word is only descriptive of
the weight and fneness of the metal the piece
| contains, and the law making it a legal tender
merely says that when one has contracted to
pay dollar without saying what kind OF dol
lar, he may pay this.
That the law of supply and demand controls
! the price OF commodities, including silver bull
lion is readily conceded; and In saying the law,
! by its own force can ada valne TO a coin made
of commodity think there is more confusion
in stating the question $50 as tosee its limits
than in reasoning about it. Prof Bonamy
Price. whose opinions are respected, though
his belief in the single standard is not liked by
advocates of the double one. says
"a strange delusion is widely prevalent on
/ this matter. II is the stamp impressed on the
/ coin, men say, which gives its value as money.
| II the stamp gives its value in purchasing
/ power TO the sovereign, then why not the SOW
/ ereign be made of copper and be pronounced n
pound and be declared TO be- enttled to pur-
chase the same quantity OF goods in the shops
as the golden one"'
! have mentioned that rarity is one of the
qualities required of a metal for coinage and
may add that all agree the average ratio of
weight of gold and silver of to l5Is was fixed
/ because that was the average of production for
! 200 years, and thus we see relative quantity or
supply OF the metal is the basis of the concep-
ton OF the relative value of the coin. TO con-
slider whether there can be any such thing as
fat money we have 10 separate the question
! from every element OF supply and demand and
OF force or contract. So longas we let any of
/ those things in as causes we cannot consider
our measure the force of a law 10 effect value.
( II Europe should make silver a standard to-
morrow and thereby create aslarger demand for
silver. the demand would INCREASE the price if
the supply remained constant but 1.-THE sup
ply increased more than the demand silver
would still go down. If it advanced in price the
law of supply and demand would Still be the
proximate cause, the demand being effected
through the law. Here at first Sight one might
say the law affects the. value of the coin; but
that is just what | say, because 1t affects the
demand Tor all sitcer and through the silver
affects the coin, ana we all Fnow that if silver
should 60 to coinage value we would not want
any law of legal tender to fix the value of the
coin. This was shown in the case OF our trade
dollars which were not legal tender, nor in
tended for circulation as money; but as they
contained 400 grains they were worth a dollar
on the standard OF one 10 sixteen for about
year after the standard dollar was worth less
I and about E, 900 UU0 of them got into circulation,
though, If I remember rightly, post offices and
government offices would not take them and
]
standard countries gold circulateS as coin for
| its value without the aid OF any law. So far we
have not the question of fiat money at all, but
only the case that all silver, including the coin.
will 60 up with increase of demand. II Europe
was using silver as a standard and in large
amounts, and should demonetize it and use
/ less the price OF silver would go down unless
! the supply decreased or the demand elsewhere
| increased; and thus brings US nearer the Ques-
ton of fiat noney-it brings the inquiry whether
legal tender silver coin can hold its value by
/ force of the law, separated from the price Of
silver and from the question of supply and de-
mand, which affects the price OF silver? But
we can more efectualiy get rid OF the idea of
supply and demand by putting the question
whether the government can today buy "a
cents worth of silver, coin it immedi-
ately anu by law make it worth
dollar without any change in any
/ circumstances or conditions affecting the case
except the mere coinage. The proposition is
somewhat startling, for it points out ways to
make money SO plenty that it would not be
money at ALL and it abolishes bankruptcy of
nations. and reduces money to mere dictum
and form of words. | do not see taat anything
can be said to prove such a proposition is true,
and perhaps very little can be said to proveiJ
untrue. We may. however cite the judgment
aud opinion OF the world against it. have
mentioned that the standard OF l TO 15ls was
fixed on the ration of production, but if the law
makes value no such inquiry was necessary.
Senator Jones, q strong advocate for silver, has
collected statistics OF the rations of use of the