The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1894-10-05

mint of the lifted States 10 ounces OF
pure silver would bring exactly the same
returns as one ounce of pure gold. The
two quantities were
Treated as of Equal Value.
But at the same time in the open mar
ket l ounce of gold would bring more
than Is ounces of silver, running in 1913
up to 1925, and never falling during the
first third of the century except on rare
occasions below 1880 That is. at the mint
the owner of an ounce of gold bullion.
could get for it only the equivalent of Is
ounces of silver, while in the market he
could get for his ounce of gold from Is 1 g
to more than 16 IA ounces of silver.
What would you have done under those
circumstances Why, you would do just
what he did, and so would /; namely, dis
pose of the gold bullion in the market and
not take it to the mint. And an exami
nation of the table ON page 301 of the latest
report of the directors of the United States
mint reveals the fact that from the foun
dation of the mint up to the year 1894,
period of over 40 years, the total coinage
of gold was as follows: Eagles, s., 1926, 800;
half eagles, $10,949,3 15; quarter eagles,
S15O,655; total gold coinage in all the minis
OF the United States for 40 years, S12,4
$50, or an average per year of $40, 647.25l
During the year 1915 the total gold coin
age of the United States was 50, rs, and
during the succeeding two years not
dollar of gold was coined; and during the
succeeding II years practically all the
coinage (and this was considerably more
than half of that coined in the 40 years.
was simply for the purpose of securing the
government certificate (shown by the
stamp of the fineness of the gold, for the
purpose of sale
The following significant statement is
from Laughlin's History of Bimetallism
in the United States: "As early as 1915
the United States began to recognize that
Hamiltons ratio of l to Is differed sc
much from the market ratio between gold
and silver, that if it were designed tC
maintain double standard new adjust
ment of the legal relation of the two met
ais was necessary. While nominally pos.
sessing a double standard, the country
really had only one, and that a silver
standard"
And in Senate Document No. 10, first
session, Twenty first congress, is the fol-
lowing statement: Our gold coins are
withdrawn from circulation soon after
they are issued from the mint"
Thus we see that owing to the fact that
the mint ratio between gold and silver
differed from the market ratio, and tina,
gold was undervalued at the mint we had
during the years from 1892 to 1884, and es-
pecially during the second half of that
period, no gold in circulation, although
the minis were open to free and unlimited
coinage of both gold and silver.
The Act of 1884.
The necessity for change of ratio hav.
ing been apparent for many years, the
coinage ratio was changed in 1884 from IL
to $685. AS silver had been the standard
for 40 years, and the business contracts OF
more than generation had been based
upon the silver dollar as the standard, it
was deemed wise to effect the change in
ratio, not by making the silver dollar
larger, but by making the gold dollar
smaller. The amount of pure gold in the
gold dollar was therefore reduced from
"a 3-4 grains to % 1-5 grains.
: The ratio, as l have said, was fixed at
1898. But for the next 20 years the actual
commercial ratio fnctuated between Is SO
and 1898; that is, gold was now overvalued
at the mint, while silver was undervalued
In other words, gold was worth more at
the mint than in the market, while the op
pOSlte was true of silver. In consequence
OF this fact silver retired from circulation
and gold became the standard, and has re-
manned so from that day to this. The
change was made 60 years ago by the sim
pie device of changing the ratio.
AS you are all aware the middle of this
century was signalized by immense gold
discoveries, occurring almost simulta-
neously in Russia Australia and Califor-
MIA. The total gold production of the
world increased from an average of
S13, 4S4, 900 in the thirties to an average of
about $133, 100000 in the fifties. AS con-
sequence the value of gold in relation to
silver fell to 1888. This emphasized still
further the difficulty of keeping silver in
circulation. When a silver dollar was
actually worth $1.04 man would hardly
pass it out as coin-there was too large
profit in selling it as bullion.
The subsidiary coin (halves, quarters,
dimes etc. was at the same ratio as that
for the dollar. AS a consequence there
was great dearth of small change, so
great as to seriously embarass business, as
is shown by the following statement of
the Hon. G. L. Dunlap, in the Congress
sional Globe of Feb 1, 1853.
There is, then, a constant stimulant to
gather up every silver coin and send it to
market as bullion to be exchanged for
gold, and the result is the country is al
most devoid of small change"
The Act of 1853.
Driven to it by this lack of small change.
congress determined in 1853, in response
to the unanimous demand of the people,
to change the size of the subsidiary coins.
The situation in 1853 was this: The sill
yer dollar and all subsidiary silver coins
had retired from circulation. The annual
production OF gold in the world was about
S133, 100000 year, while the annual pro-
duction of silver in the world was less
than S37 100000 year. The gold coinage
OF the United States alone in 1852 was
about S57.0O0,OO0, while the silver
coinage was less than S1,OOO,OOO,
of which the coinage of silver dol
lars was exactly S1,100 Now, what
would sane men do under those circum-
stances? They knew from experience that
no ratio that they could fix between gold
and silver would give them the joint cir
Culation of both and they had to make
choice between them. Who is there within
the sound of my voice who, had he been a
member of congress at that time, would
have hesitated one moment? The annual
production of gold was immensely greater
than that of silver. so congress naturally