The morning call., 1893-12-09
PLEHN ON MONEY.
Values and Prices Are
Defined.
EXCHANGE IN ECONOMICS.
Monometallism and Bimetallism
Discussed.
THREE CENTURIES OF SILVER.
An International Double Standard
Tentatively Advocated by the Cali
ifOrnia University Professor.

IIoiesSOr ". y. IIenn QellVereQ the
eighth lecture in the university course on
political economy last evening before an
audience which filled the Art building to
Its utmost capacity. Exchange and money
were the topics considered, value and
price being included under the first head.
and barter, early forms of money, modern
currency, monometalism and bmetallism
and the history of silver from 1545 up to
the present time under the second.
The necessity and advantages of ex-
change were clearly shown, and the fact
was demonstrated that in any fair exchange
both parties are gamers. as each desires the
article in the possession Of the other indi-
vidual more than he does the article which
he himself holds.
Exchange In itself soon becomes an i'm
portant branch of business and gives rise
to special class of merchants or trades
men, who arrange exchanges between diff
ferent producers, also to bankers, brokers,
etc., whose sole trade it is 10 handle money.
The part which railroads have played in
broadening the advantages and means of
exchange was spoken of briefly. the fact
being stated that before 1880 the present
factory system did not exist, and markets
were fewer and less accessible. Now
facilities for transportation being i'm
pAONcus oCiCio un0 diC
nearer together. and the machinery of ex-
change, though more complicated than of
old. works easily and smoothly.
Value, which is the psychological esti-
mate OF the Importance of the want to be
satisfied, based on the final utility of the
article IN question, was next considered,
1t was especially impressed upon the audi
ence that value is simply a relative term.
and that absolute value" which is often
spoken of. cannot exist, as we esti-
mate value only by comparing one
article or class OF articles with another.
To be valuable IN exchange an article must
be susceptible OF exchange az well as use
ful, aud each case requires two parties and
two fOurfod estimatrs. Final value is de-
termined by tile man who Is least willing
to buy and the man who is least anxious to
sell, and price is the value of an article ex-
pressed in money. Where competition be-
tween buyers and sellers is perfect the
price will tend to conform to the absolute
cost of production; but perfect rompeti-
ti0n involves thorough information as re-
CARDS markets, equality Of advantages be-
tween buyer aud seller and mobility of
labor aud capital.
Money was next taken up, and the old
cumbersome and inconvenient system of
barter was explained. as also the earlier
forms OF money, including cattle-from
which our modern word penny comes
skins, tobacco, corn, etc.
Gold and silver came into use as cur
repcy thi ough being universally priced for
personal adornment. Their principal ad-
vantages were their large value in small
bulk, their divisibility, durability and
steadiDess in value due to regularity OF
demand and uniformity Of cost OF produc-
ton.
The difference between base and sub.
sidiary coins was next explained. and the
speaker passed on to mopometallism and
bimetalllsm.
When one metal is adopted BY nation
and that alone made unlimited legal ten
der. with free coinage, that is monometal-
lism; when two metals are so adopie ed that
is bimetalism; but this involves fixing the
ratio between the two. and the colts must
be OF fixed value, remaining the same for
at least series of years.
Paper money, which originated among
the jewellers on the shores of the Mediter-
ranean. was explained as being merely
certificates OF deposit or promises to pay.
Bank money and Government money were
passed over quickly. The functions of
money were stated to be universally ac-
cepted medium of exchange, measure of
value. aDdard for different payments, and
store of value. The value of each piece
of money is fixed by the relation between
the amount of money work aud the amount
Of money availabl to do that work, much
money making high prices, little money
making low prices.
The subject OF silver was then treated al
length, its history being carefully traced
from 1545. when the mines of Potosi were
opened and silver freely sent to Europe,
up TO the present time.
The present attitude of certain nations.
including our own, on the question of sill
yer to-day the professor declared was due
In great gart to the action of Germany in
1876. when. despite the protests of many of
her best scholars and ablest men. she
demonetized silver and precipitated an
avalanche which affected other countries
as we'll as herself.
For bimetallism:its advocates claim that
II is possible 10y this system to obtain more
money to circulate 10 this country. as there
is not enough gold to do the business
properly. They also claim that this sys-
tenn would obtain greater steadness for
the whole currency.
In conclusion Professor Plehp expressed
himself as believing that an international
bimetallism would be in many ways benefi-
cial, and that IL was not unlikely some ar
rangsment of this nature would entualIy
ba a0e