St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1895-07-10
THE CHEAPNEss OF MONEY

Within less than six months the
prices of all the great staple COM
modities Of this country have ad-
Nanced from to % per cent, and
In some cases even more. Within
the same period the wages OF not
less than 100000 employees have been
increased from 10 per cent upward.
This rise in the value of commodi-
ties and of labor has been welI-nigh
universal. 1t has given employment
to the unemployed, and has in
creased the remuneration of the en-
ployed by substantial amount. In
considering the condition of the
eountry and the signs of the times.
there is no fact so well established
and so significant. If we are to
argue anything at all from the de-
eline of prices since 1873, we must
argue the exact contrary from the
rise in prices in 1895.
Now a great many people have
come to believe that a part of the
fall in prices of commodities was
due to the appreciation of money.
They say that the real change was
produced by currency legislation,
Which has caused money to appreci-
lite in value. If this is true, the re-
cent general rise of the prices of
,ther things ought to have been ac-
eompanied by a still more pro-
bounced rise in the value of money.
i it was money scarcity and money
aearness that made and kept prices
30 low before, then they could have
advanced only because money be-
eame more plentiful and cheaper.
The fact is that the supply of money
has not changed practically at all.
Yet money today is abundant and
cheap to an extent seldom, if ever.
before known. The Pennsylvania
Railroad company has just conclud-
ed loan for $5,0OO,000. These bonds
are to bear 80 per cent interest, and
to run for fifty years. The road
does not borrow this money on ac-
count of any necessity, but simply
vorable to borrowers that it cam re-
place outstanding securities with
new ones issued at a lower rate of
interest. An official of the company
states that the reason for making the
loan is the abnormal ease of the
money market.
All the commercial reports say the
same. The three bond issues of the
United States government have alb
sorbed $165, O0O, 600 of idle capital. Yet
the last New York bank statement
shows the average cash to
be $176,OOO,0OO, and the excess
reserve over the legal re-
quirement $36,OOO,OOO. The same
condition prevails in all the money
centers of the world. The British
treasury recently offered a million
pounds in treasury bills, and sixty
million pounds were offered, the low
est rate being less than 1 per cent.
All the financial journals treat, at
more or less length, upon this condi-
ton of the market. They agree that
the great reverses met by capital
In Australia and South America, and
the fright that it received by pro-
posed silver coinage in the United
States, have caused it to be kept in
the safes of its owners until it has
accumulated to an almost unprece-
denied extent. Money is everywhere
seeking for safe investment at the
lowest remuneration.
We have thus actually in existence
today, without one dollar of recent
additions to currency by any of the
principal countries of the world, the
conditions which the fiat money peo-
pie tell us can be reached only by
currency imitation. We have super
abundant capital seeking occupa-
ton, interest rates the lowest even
known, and the prices of labor and OF
commodities in general steadily or
the rise. Can anybody suggest any
situation more favorable to our great