The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1894-06-24
~
Nw1e1zes
THE BIMETALLIC RATIO.


Henri Cernuschi. in the London Times.
BY an accident which 1 regret, your
challenge TO bimetallists escaped my at
tention until to-day.
Speaking OF the Mansion House confer
ence you said:
More confidence might perhaps be felt
IN the Sd Fa e P p ta ne
what ratio they would fix If they had their
way But it is at this point that
the courage OF bimetalliSts falls them. One
and all they shrink from giving the small
est Indication or what they think the ratio
ought TO be-
beg your leave to reply.
Either it will be stipulated that silver is
10 be universal money and that gold is to
be money in Europe and the United States
at the ratio of to 151z of silver or nothing
will be stipulated.
Why?
Because If, for the 49, ratio. a ratio
more favorable to gold were substituted,
France would either have to melt down
her gold francs in order to create lighter
ones, or 10 melt down her silver francs in
order to create heavier ones. l am about
to demonstrate that France cannot and
should not engage TO melt down either her
gold francs or her silver francs.
Two hundred silver francs (9-10 fine)
weigh one kilogramme GO pieces of 5
francs.) Three thousand one hundred gold
francs C9-10 fne) also weigh one kilo-
gramme Q55 pieces of 20 francs) These
200 francs in silver and these 800 francs
in gold exhibit the old 1 10 1914 ratio. con-
stituted by free bimetallic coinage prior to
1873.
Suppose that, according to what is pro-
posed in several quarters, France agreed
TO ADOPT as interna tional ratio between sii-
and gold, the l 10 . ratio in lieu or
her old 1 TO l0i9 ratio.
by creating gold francs of less weight than
the present franc she would have TO cut up
the kilogramme OF gold no longer into 155
pieces, but in go pieces, each 10 be current
as % francs, although lighter. There would
then be 5000 gold francs confronting 200
silver francs; for 5000 is to 200 as . is TO l.
He who now possesses 800 gold francs
would find himself possessing 5,oO0- He
would melt down the 80 pieces and would
present his ingot 10 the mint, which would
give it back TO him cut up into go pieces
OF 20 francs each 5000 francs) He would
so gain 1900 francs or 81 per cent This is
absurd, ridiculous, inadmissible.
But II, 70 realize the ratio OF 1 to %,
France, instead of altering the gold francs,
sailed in the Sysr fSnds an6 ere9 TS
kilOgranfme of silver would have to be cut
UP. no longer into 200 francs, but only into
Ia francs; for S,lOo francs gold are 10 Ia
francs silver as = 10 ], a loss of Is francs,
or IS per cent. This loss would have TO be
borne. not by the holders, out by the gov,
OF francs Withdrawn from circulation the
French treasury would have 10 deliver a
fresh milliard In silver pieces at the in
creased weight Of IS per cent, or else in
gold francs. a loss OF $50 millions OF francs
on every milliard
IL Is true that the fve-franc pieces. since
1S73 have been metallic aSSignats. just like
ali the silver pieces existing in Europe and
in the United States. and just like rupees
since the free coining OF silver was pro
hfbited in India But the gold francs are
so plentiful that they are not at a premium
bimetallism at 15tz France will have 10
keep the status quo. She viii wait
. The disappearance OF the French BIZ
metallic par I'm 1873 has had two conse-
quences--(D frequent and violent huctua-
lions In the rate or exchange between the
countries coming only gold on the one
hand. and on the other hand the silver
monome tallic countries; CD a heavy fall
In that rate OF exchange.
Fluctuations in the rate OF exchange
would cease OF course, IL any ratio 90, 10,
20 ~. were fixed by the great metallic