The Abbeville press and banner. [volume] (Abbeville, S.C.) 1869-1924, 1894-12-05
FIGURES FOR FARMERS.
COL. L. w. YOUMANS ON OUR
FINANCIAL HISTORY. ..

| Evidence Offered to Prove That the "Gold
| Standard" fs Disastrous to Producers.
The Effect of the Demonstration of
| Silver.
To the Editor of The State-In my
second article, it was conclusively
proved that the fall in the price of
cotton in 1887 and the twelve years
I succeeding was due to the collapse OF
the paper extension, due to the estab-
lishment, in 1926, of the joint stock
banks in England, and the increased
issues of the State banks in the United
State. The bank failures which took
place in England after the panic OF
1887 attracted the attention OF Parlia-
ment, and resulted in 1874, in the pas
sage of an act known as the Peel
Act" limiting the paper currency OF
Britain to f3O, 900, 900, equally divided
between the Bank of England and the
joint-stock and provincial banks.
This act sealed any further paper ex-
pansion in Great Britain from that
day to this. After the destruction OF
the Second Bank of the United States
the circulation in this country was
confined to the State bank notes and
| gold and silver. The State banks, be-
ing required to redeem their notes in
specie, were conservative in the
amounts they issued. Under these
circumstances, the value of money,
both here and in England, maintained
its reduced proportions after the panic
of 1887, until 1s49, the time Of the
gold discoveries. may note that in
this country the paper circulation In
1887 was one hundred and forty-nine
Millions in 1S49 it was one hundred
and fourteen millions, but as soon af-
ter the gold discoveries as 1854, it had
risen to two hundred and four mil
lions. The production of gold, which :
amounted to twenty-seven millions in
1s49, rose Immediately thereafter to
considerably over one hundred mil
lions annually, and held these figures
| for ten years, rising as high, in 1853,
l-as one hundred and fifty five millions.
Thus we see that from 1887 to 1S49 un-
der shrinking volume of money, the
price of cotton underwent heavy
decline, though there was no material
increase in the volume of production,
whilst from 1649 to 1860, under the
stimulus of an almost quadrupled pro-
duction of gold, the price OF cotton
doubled on twice the volume OF pro-
duction.
| Twill have to pass over the period
from 1861 to 1867, because OF the dis
turbances and irregularities occa-
} stoned by the war. In1S67, however,
war prices were over, and although
. cotton was quoted in this country in
| 1867 at 81. SO cents and in 1872 at N:4S
cents, there appears to be decline.
!. Such was not the case, as these quo
tations were in deprecated incon-
vertible paper currency, which under
the influences of contraction was rap
idly falling to specie basis. To ascer-
tain the specie price we will have to
consult the European markets, where
pavment-was made in gold. Here we
! find that, while the volume Of produc-
ton nearly doubled itself from 1867 to
1872, the price remained about the
same. cotton being worth 1898 pence
| in 1867 and 1918 in 1872. Up to this
period 1S72-the mints OF the civlllz,
ed world with butfew exceptions (and
these exceptions about equally divided
between the two metalS were open to
the free and unlimited coinage OF both
| cold and silver, at a ratio ranging
about Is 1-2to /. Consequently up to
this time the volume. of money was
omen to the addition of both metals as
they were mined.
Now let us bear in mind that from
1909 to 1S49, the annual average out
put from the mines was forty-seven
million or thereabouts, and that prices
declined to less than half OF their Tor
mer value-that after 1849, say from
, 1852 to 1872, the annual volume rose
, with the increase of the gold discover
) les to one hundred and seventy seven
} millions and theaverage price OF com.
T modities on this swelling volume OF
money rose "a per cent. from 1S49 to
, 1872. Such was the invigorating effect
: of an expanding volume OF the pre-.
= cious metals and rise in the price OF
commodities that though this country
had just sustained the greatest drain OF
: blood and treasure ever exacted by
war from any nation, yet she was ona
5 perfect wave of prosperity, every de,
: partment of industry was thriving and
| prosperous, and all the products of la
bor met with profitable sale. The out
| look seemed to justify the prediction
of Alison in 1855, when he said that
during the last half of the century the
!. expanding volume of money and tho
, rise in price of all the products of Ia
bor would proportionately encourage
? enterprise, unity industry and lessen
the burden of debts and taxes; but in
: 1873, the tide of prosperity. began to
r ebb, the purchasing power OF money.to
= increase and the price of commodities
: to decline.
What was it that reversed the
, wheels of progress2 Samuel B. Rug
gles, an active member of the cham
J Der of commerce, of New York, men
toned by John Sherman, the Cataline
, of American finance, and coached by
Michael Chevalier, the minion and
: mouthpiece of the money power OF
Europe, in furtherance of the most g.
T gantic scheme of plunder ever con
; ceived by men were piercing our great
| metallic international conference at
Paris in 1867, alarmed the fundhold-
ers of Western Europe by telling them
that over hele we were piercing our
: great metallic interior with railroads,
!: and were now mining nearly one hun
dred millions worth of the precious