Fairhaven herald. [volume] (Fairhaven, Wash.) 1890-????, 1893-03-07
What Would Happen.

| consluerlnS Ine present value OF the
metal gold as compared with the metal
silver. The United States government
has placed its stamp upon a given
amount Of gold and called it dollar.
1t has also placed its stamp upon given
amount of silver and called that dol
lar. Now, if you melt the gold dollar
the metal that is left, minus the alloy,
will still be worth a dollar on the gold
market. But if you melt the silver dol
lar the silver that is in it after the gov
eminent stamp is destroyed will only
sell ON the market for 81 cents or there
abouts.
The above illustrates the difference in
the market price of the two metals, gold
and silver AS compared with gold, the
price of silver has fallen SO steadily that
many predict gold will go to premium,
will therefore go out of circulation, and
we shall come to a silver basis for our
currency In fact, already some heavy
inanciers in New York are buying gold
options for six months ahead at pre-
MUM of II. The options are sold main
ly by foreign banking houses. At that
rate $4,000 would pay for an option ON
81 ZOO, 900. There is an estimated amount
of 5000, 0O0, 900 gold money in this coun-
try at present, counting the United
States treasury reserve and all. Achque
of spectators might, at the rate of II
premium, buy an option on all the gold
in the country for 100000. They
could thus force gold to premium.
Suppose this were done, or that from
any other cause our silver dollar fell to
the level Of the silver bullion market in
London. Assuming this to be 81 cents,
the gold in our gold dollar in that mar
ket would be worth 83 cents more than
the silver in our silver dollar. That is
another way Of saying that gold had
gone to its full premium
Immediately all prices and CONNER
cial transactions in this country would
be forced to adjust themselves to the
new basis Take cotton, worth SO much
in gold in London On our silver basis
it would be worth third more here. In
this country the prices of all other
worlds commodities-that is, all i'm
portant commodities that have a con-
slant quotation in the markets of Eu-
rope, where the gold basis is maintained
would rise in proportion.
Hara 80 oo,,rea 1abta ,rvo,,I1 h. ,.o,-o
BILE on the silver basis, and the debtor
who incurred his liabilities before the
rise in gold would be the gamer 33 per
cent Depositors in savings banks would
be the losers. They would have put their
money into the banks on the gold basis
and would take out the same number Of
dollars in a currency worth third less
Tocounterbalance this, however, borrow
ers from the savings banks would be the
gamers in like proportion, while the
savings banks themselves would neither
gain nor lose materially.
Banks of deposit in New York and
some other large cities have so arranged
their affairs that they would be the gain
ers largely if gold should go to a pre-
MUM. They have set their traps to
"catch the coon a-comin and catch him
s-gwine." Their reserves are held in
gold or gold certificates They have, as
a rule, required notes payable in gold
for discounts. Their deposits, received
on the gold basis, would be payable on
the silver basis Hence they would gain
everything and lose nothing.
The immediate effect upon labor would
be much as if wages were reduced uni
versally 33 per cent Organized labor
would enter upon struggle to advance
wages, and a serious and prolonged con-
f1ict between employers and employees
would probably follow.
Business corporations, especially rail-
road companies, would suffer. Wages
would necessarily advance, so would raw
material and everything else, and en-
ployers would find difficulty in advanc-
ing prices to meet the increased expenses.
In case of railroads the passenger and
freight rates are in many cases fixed by
law. At once railway supplies would
rise in price; next the wages of railway
employees. Until legislation could give
them relief the railroad companies could
not raise their rates to meet the increased
expenses, and they would be in straits.
Great industrial corporations would suf-
fer, too, for the same reason, but they
could adjust themselves to the situation
more easily than the railroads.
Our gold would go out Of the country
to Europe, making the supply there more
plentiful That would tend to depress
its price. Here, on the other hand, the
increased demand for silver would raise
its price. These two influences would
reduce materially the disparity Of value
between the two metals and tend TO re-