People's voice. [volume] (Wellington, Sumner County, Kansas) 1890-1917, 1893-06-09
SENSELESS TWADDLE.
The Fiat of the People, Expressed in Coin
age Laws, Gives to Gold and Silver an
Artificial Value

morning communication from friend
in Missouri on free coinage and legal
tender We think, too, that all of US,
that is, almost all of us, want an "hon-
est dollar" a dollar of full value at all
times. That much admitted, we have
only to determine how we can secure
such dollar. There is not much diff
ference of opinion between the Courier
Journal and this correspondent, In
deed, it is confined to one point. He
contends that gold dollar is a gold
dollar because congress has said
so, and that when congress says
1925 grains of silver constitute a silver
dollar it will be worth 100 cents.
We think not. The fat of congress
does not make 25.S grains of gold worth
81. The market price determines the
value of both metals. The markets,
and not congress, control. Congress
can no more fix by its fiat the price of
silver than it can the price of wheat or
Of cOtton.-LOuisville Courier-Journal.
Compare the above senseless twaddle
with the following extract from the
speech of Senator Jones, of Nevada, be-
fore the international monetary COM
mission:
IF we are to rely upon gold alone for
money the world must be prepared for
a period of long enduring distress and
disturbance. But why should we rely
on gold? Its prestige comes from the
general belief that its value as money
is derived from its value as a commodity
in the market. The fact that the Bank
of England, under the requirement of
its charter, always gives e3 lis Cd for
an ounce of the metal, and that it can
nowhere else be got for less, is taken
to be demonstration that the demand
for gold as a commodity determines the
value of the metal as money.
"The annual yield from the mines be-
ing about S1OO,OOO,O 900. and the demand
for the metal in the arts about sos, 0OO,-
600, while for coinage there is a supply
of but S35,OOO,OOO, it is argued that the
commodity use is greater than the
money use, and therefOrs fixes the
value of the metal.
81 maintain that this theory is flnda-
mentally wrong. Instead of the COM
modify demand establishing the value
of gold as money, it is the demand for
the metal as money that fixes its price
as commodity. This should be plain
from a consideration of the factors en-
tering into the question of supply and
demand.
THE demand for gold, as for other
things must mean the aggregate de-
mand for that metal for all purposes
whatever. 1t must, therefore, include
the demand for gold for purposes of
money as well as use in the arts.
Against this, what is the aggregate
supply? Manifestly not the trifing
production of one year. The metals
being practically indestructible, the ag-
gregate supply available each day is
the entire stock in eXistence-the stock
that has been accumulated through the
slow process of time, reinforced each
year by the current product from the
mines. In other words, the aggregate
supply is the supply from all sources;
the aggregate demand, the demand for
all purposes.
The total amount of gold in exist
ence, estimated in money of the United
States, appears to be, in round num-
bers, about $4,000, 100000 Such por-
ton of this as exists in the form of
bullion is not the only portion on which
the art demand is made. When a
jeweler, dentist or glider wants gold
for the purposes of his trade he does
not seek the seller of bullion. He
takes the gold coins and melts them up.
As have said, therefore, the supply
available for commodity purposes and
against which that demand presses is
the entire stock of gold in existence.
This means a commodity demand of
65,OOO,OOO operating against a supply
of $4,000, 900, 900, or in the proportion
that 65 bears to 1000.
What, on the other hand, is the de-
mand for gold as money? To measure
this demand by the coinage of each
year would be in the last degree alb
surd. We know that all the labor and
all the salable property in Europe and
America are constantly offered in eX-
change for gold. 1t would not be too
much to assume that each dollar of the
$4,000, 100000 in existence is earned
that is to say, an effective demand is
created for it-twice in each week, or
1O4 times year. This constitutes
total annual demand of S416, 900, OOO, 900.
The proportion, therefore, which the
commodity use of gold bears to the de-
mand for its use as money is the pro-
portion that IS bears to 100000.
ut is this colossal demand, and not
the insignificant art demand, that fixes
and determines the value of gold. The
statement that the precious metals are
dependent for their value or price upon
the coinage demand is supported even
by the very name bullion, which
originally meant the mint where the
alloy for coinage was prepared and the
coin impressed with the stamp of the
government. From the frequency with
which in France the government au-
thorities debased coinage, the word
bullion ('mint0 came to signify the
base mixture issued from the place of
coinage.
mot only is the money demand infn-
itely the larger of the two, but it is in
creasing in an accelerated ratio.
Take away from gold the demand
for it as money-limit the demand for
~ rrbol1,-