The Kinsley graphic. [volume] (Kinsley, Kan.) 1890-1940, 1895-08-23
THE PRICE OF GOLD.
It Il Regulated by the Law Governing {
bank of England

PnbS6 Of ZULU.
It Il Regulated by the Law Governing tho
bank of England
l have seen it stated that there has
been a law in England in force for
many years making it obligatory on
the Bank of England to buy ali the
gold bullion offered it at stipulated
price, and it is said that this statute
has kept gold up to this point of value
ever since the law was passed. Is this
correct? a. C. NJ.
1t is correct. The law of 1874. under
which the last charter of the Bank of
England was granted, provided that
notes may be demanded of the bank
for gold bullion at the rate of e3 It's.
Cd. per ounce of standard gold. The
meaning of the law is, of course, that
the bank is empowered to issue notes
for all gold brought to it. This obi
CATION is great convenience to the
public, and, of course, is OF no injury
to the bank. If the person who brings
the bullion wants coin instead of notes,
he is obliged to pay more for it to save
himself the trou BILE of waiting until it
is coined.-Chicago Inter Ocean.
While there is no dou BIT but that the
price OF gold is regulated by the pro-
visions OF the law governing the Bank
of England, it is apparently true that
the bank has the power, or right, to
vary the price paid from time to time
and within certain limitations. Thus,
for instance, on July &c the bank of
England announced reduction in the
purchasing price of French and Rus
sian gold coin to 76s. 314d. per ounce.
This was done to check gold shipments
from France to London. The price of
American gold is reported to have been
reduced to the same price from 76s. 31zd.
From this it appears that the price
paid in notes, by the Bank of England,
for gold coin of the United States,
Russia and France is 93 los. SID. per
ounce, or Is. 3s4d. less than the price
named in the Peel act or law of 1914.
Commenting upon this state of affairs,
the Kansas City Star says:
A cable from London announces that
the Bank of England has reduced the
price which it pays for gold. the pur-
pose being to check the tendency of
foreign gold to come to its vaults.
There has been an almost uninter-
rupted stream of money (the Star
should have said ''gold'O flowing to-
ward London for several years. The
disposition of the thrifty Englishman
has been to call his chickens home and
count them. Instead of being an in
weston everywhere, he has been hold
ing his earning at home and calling in
the capital he has had in other coun-
tries. This process has gone on until
all the banks of the kingdom are
glutted with idle money and funds are
being loaned for a fraction of 1 per
cent a year. The latest flood of gold
which threatens to flow to the great
financial capital of the world is from
France. The Chinese loan, foated in
Paris under the patronage of Russia,
will result in great transfer of capi-
tai from Paris to london. The Japan
csc, to whom the money obtained
through the loan is to be paid, propose
to spend a considera BILE part of it for
new warships and for supplies of vari-
Gus sorts, and England will furnish a
large part of these supplies The
Japanese want their funds in London
banks TO make these payments and to
take up outstanding bonds of their
own. The London bankers, of course,
do not object to holding these funds,
nor to seeing the money spent in En-
gland But they are perfectly willing
that the transfer should be in the form
of bills of exchange or investment Sc
curities instead of gold, and that is the
reason why the Bank of England has
lowered it's price of gold.
''Undou btedly English bankers would
much prefer to see securities and bills
of exchange coming to them from the
United States to having gold shipped
to them. They have more gold now
than they know what to do with, and
they would welcome, more gladly than
anyone else, a reversal in the currents
of trade which would carry gold from
England instead of to England. The
Englishman is no worshiper of gold.
A thousand dollar bond or block Of
good stock is held in very much higher
esteem by him than bags of gold or
bank notes No Englishman is enough
of a believer in the appreciation of gold
to hide bags of it away and watch it
grow more valuable He wants it
where it will be in active use, produc-
ing new wealth for himself and those
who employ it. When the rising tide
of business the world over reaches that
point where it will float the gold of
England off to other shores-to Amer
lea and Argentine and Aurtralasia and
other progressive countries-no one
will be better pleased to see it go than
John Bull himself"
All of which goes to show how ut
terly useless and worthless gold is, un-
less it can be loaned out at interest. as
money. producing new wealth." as
the Star says
The gold bugs say: ''There is a great
deal of foreign capital (money?) that
would like to come here Do they
mean that foreign nations are anxious
to send over here, as a loan. their la
borers, and their land, iron, coal, wood,
wool, etc? All! no-they mean gold,
when they say capital But gold is
not capital. being unproductive and
almost utterly useless as factor in
producing more wealth, its utility in
that direction being limited to the mar
row sphere of a few useful arts What.
then, do they mean? They mean that
we should borrow of foreign nations
gold upon which to coin, or write our
orders for, or title deeds to real capital,
and henceforth, forever, annually pay
millions of tribute in actual wealth.
wheat, cotton, corn, etc.-for the use
of gold upon which to stamp our token
credit, when paper would answer the
purpose fully as we'll and would cost