The sun. [volume] (New York [N.Y.]) 1833-1916, 1893-07-03
THE DOWNFALL OF SILVER.
ws,obine tho eourse o, financial afra,

ultimate recovery from IL Is certain. exhibits
such alterations OF good and bad symptoms
that It keeps the patient and his friends con-
tinuslly uneasy. When. three weeks ago. the
announceme emit was m ade that President Cleve-
land intended to call Congress together In
September, or before, to repeal the Sherman
act IL was hailed as tho promise OF speedy
financial convalescence, and whom, the follow
ing week. the banks decided to issue Clearing
House certificates to enable them to lend more
literally to their customers, tho feeling OF
hopefulness was confirmed. Then came. last
Monday. the news that tho British Govern
ment had suspended tho free coinage OF silver
In India, and q revulsion took place. The
price OF silver fell nearly one-fourth. and that OF
wheat with It. Something like panic began
to prevail on the Stock Exchange, and enor-
nous rates werc paid for money. Prompt
action by the banks in increasing their nc
commo dations averted a crash and turned the
tide. and now tho Presidents proclamation
converting Congress on the 7th OF August has
made every body cheerful except those who
have sold stocks short and will have to buy
them in at a loss
That tho action OF the banks last week in
supplying the panicky demand for money
should have had beneficial effect Is easily
comprehensive, but why the suspension offrce
silver coinage in India should have caused SO
much depression not only In silver. but in
whent and In stocks, Ia something that cannot
be explained on logical grounds. That the
measure will. to some extent. diminish the
demand for silver In India is possible, but 1t
will not totally destroy 1t. The people OF that
country will continue to buy silver and to hoard
1t rs treasure. and tho Indian Government
will continue to coin 1t into rupees.
That fall In its price should make
wheat lower in tho London market Is
i'm possible The total annual consumption
OF the cereal Ia Great Britain is 125OO0, 600
hundred weight, and at no time has India fur
nished more than one-tonth Of that quantity.
This year. indeed. the imports from lnda have
fallen of. so that for the eleven months end
ing June they had amounted to but about
100000 hundred weight. against 100000
hundred weight for tho corresponding eleven
months OF the previous year How little, too,
the exports Of wheat from India are influenced
by the price Of silver appears from tho fact
that, whereas, in 1882. whom silver was 81
pence per ounce in London the exports were
l9.so3.52O hundred weight. they fell in
10000. when silver was 43 pence per ounce,
to 13, 709.224 hundred weight The idea that
the Indian wheat exporter does not get the
highest price he can for his commodity In
London. without reference to cost or profit
cannot be entertained for a moment. and II it
is equally irrational to suppose that the mar
keting Of 1880 600 hundred weight or less
OF 1t can bring 125,00o.OOO hundred weight
down to Its level AS to the fall in stocks. that
can be accounted for to some extent BY the
difficulty OF borrowing money. but the decline
OF silver ought not to have produced 1t.
The debates which will be had in the coming
session OF Congress over the proposition to
repeal the Sherman act will probably cover the
wh0la ounatipn of fha n ofc
The advocates OF free coinage will hardly have
the assurance. in view OF the present price Of
tho metal. to insist upon making silver legal
tender at our old ratio OF 16 to l. and still loss
ut the European ratio OF 15h to l. Already,
indeed. some OF them have limited at willing
ness to compromise ON the ratio OF 20 to l. but
this 10 q practical abandonment OF their claim
that Congress can mako the ratio anything /.
pleases and maintain it without reference to
tho market price of silver bullion. 1t is to be
hoped that the debates will at least put an end
to tho absurd story which, has lately teen re-
vivsd. that the Mint act OF 1873. whereby tho
standard dollar was omitted from the list Of
the national coins. was crime against
silver" procured by bribery at the iustign-
ton Of European capitalist. The fact is that
silver was really demonetized In this country
in 1884. whom We reduced the weight OF our
gold coins so that We required sixteen ounces
OF silver for one OF gold whereas the Continent
OF Europe allowed one ounce Of gold for fifteen
and one-half ounces OF silver. The conse-
queuce was. that as soon as the act Of 1884
took effect. all tho silver coin which under tho
previous law. whereby only fifteen ounces OF
1t were reckoned equal to one OF gold had ex-
clusively constituted our metallic currency
left the country and We had nothing but gold.
with worn and lightweight Mexican fractional
otU In, To-. Ill alb W.,
silver led to tho passing Of the act OF
1853. providing for the coinage OF silver halves.
quarters. dimes. and half dimes Of loss than
their proportional weight to the dollar. SO that
1t would not pay to export them. Thus the
half dollar. instead Of containing 2O64 grains
OF standard silver. or half as much as the dol |
lar. contained only 1872 grains the quarter
only 90 grains. and 40 on. When. therefore. |
the act OF 1873 was passed. We had for thirty |
nine years rejected silver as q standard OF |
value and used 1t only for token money.
The act OF 1873, moreover. instead OF having |
been first concocted In 1873 was prepared In |
1862 and passed the Senate in 1871. 1t failed |
to roach the House OF Representatives In time |
to be passed by that body that year. SO that 1t |
had to come up again and he finally passed In |
1873 The absurdity OF the story. that its |
was procured BY corruption. in pur- |
suance OF q far-seeing conspiracy against sill |
YER. is apparent from the fact that the stand |
ard silver dollar was worth then 3 per cent.
moro than the gold dollar and that both were |
at considerable premium above tho green
backs. which were the only legal tender money
In use Tho act did. indeed. provide for a
token dollar Of 308 grains. or of about the
weight of French 1--WE franc piece, but this
was only for tho sake Of symmetry. to COM
plete the list OF silver coins. and this light
dollar was properly made legal tender to the
amount Of So and no more. the same as its
At that time. too. the resumption
OF specie payments was in the dim future. and
few Of US ever expected to see 1t accom- plished.
For all these reasons the Mint act Of 1873 OK
cited no public interest. and 1t was not until
tho fall In silver a few years later. which no.
body could possibly have foreseen. showed
how IL prevented q scaling down OF debts that
the agitation for the restoration of the stand
ard dollar was commenced.
The fact 10 that the cola pss which has final
.al In, fhA .rfn -