The times. [volume] (Richmond, Va.) 1890-1903, 1895-04-17
Fal ity OF the BImetallIc Argument.

UNFINISHED the supply VI
thereby produced the great decline In
prices Of the last twenty years, and the
recent commercial depression, we nave
made reiterated reply O) that there has
been no permanent decentralization prop
er of silver within the period Indicated,
(0 that, for the whole world, the in
crease i'm silver money has been main
| tanned at about its ratio up TO lSiO' 90
| that. If there had been any contraction OF
| silver money, the resources I'm the various
| forms OF credit currency would be more
| than sufficient TO compensate for IL; and
| GD that radical revolutions I'm the worlds
| Industrial system have amply suiilced
| TO account for the fall in prices apd
| the depression Of business. SO far we
have found no one ready TO question
| these positions; and should any coinpe-
| tent disputant desire 10 answer our rea-
soning, i'm fair argument, based upon the
| pertinent facts OF the last twenty-five
years. he may find his way to the public
through our columns.
| Meantime. we ask attention TO the
views on these questions CT Henry DUN
ming '.cLeod expressed in the following
| quotation from mis- recent work, entitled
| "Bimetallism" 1t is needless TO say
that Mr.. Mcleod stands among living
| economists as the most eminent exponent
| Of the principles governing currencies.
and the ablest of authorities on banking.
We quote.
'''The rock upon which the bimetallists
| and most other persons who chatter
about the currency. founder, Is that they
| consider gold and silver only to be the
| currency, or circulating medium, and the
measure of prices. But the currency, or
| circulating medium, consists not only OF
specie-gold, silver, and coppcr-but also
of credit in all its forms, both written
and unWritten
"The bimctaIlsts persistently assert that
the commercial malaise, which prevails
throughout the world at the present time
Is due to the scarcity and appreciation
as they are pleased TO term il, by which
they mean the rise iii the value-of gold.
They attribute this to the demonetiza-
ton of silver. and they allege that this
fall in the value of a certain number OF
commodities is due to the fact that gold
has to do double duty. They allege that
If gold and silver were coined In unlimit-
cd quantities at a fixed legal ratio IL
would increase the quantity of currency
or circulating medium of the world
"Now In the first place. no country
whatever has demonetized silver; all they
have done is to restrict its quantity. In
the second place, the history of the coin
age in different countries proves that In
no country whatever did gold and silver
ever circulate together at fixed legal
ratio. But they alternately drove each
other out OF circulation. as one or the
other was overrated, or underrated, by
| the fixed legal ratio. And II is pure
delusion to suppose that coming gold and
silver in unlimited quantities would aug
ment the currency of the world.
"All the assertions are the coinage
of the vain Imagination of the bimetal-
lists. arising from their neglecting TO
study the history of the coinage in va
rious countries. and their Ignorance OF
the rudimentary laws of economies.
I'm the next place. they totally omit
the consideration of what they might see
| in any treatise on economies. that rights
of action, credits, or debts, have exactly
the same effects on production and prices
as an equal quantity of gold
1.-THE fact is that we have long passed
through the ages of gold and s'lve~. We
are now In the age OF credit. or paper
Gold and silver arc now only used IN
small daily and retail transactions TO
secve as pocket money. All operations
in commerce and trade are low carried
on BY rights OF action, credits, or debts,
and the only use of gold now in com
merce is for banks 10 keep such strong
reserves OF gold as to inspire the public
with confidence that they can pay their
credits, or debts, on demand l have
shcWn that credits or circulating debts,
now constitute about 90 per cent. Of the
currency. or circulating medium, in this
and other great mercantile countries.
"ro treat OF the question OF the cur
rency. OF circulating medium, or the
measure of prices, at the present day,
: ard to include only gold and silver under
that title, and 20 leave out all cohsidtfa-
tior of the colossal system OF credit, is
lust as irrational as It would be to write
| a general treatise on mathematics and to
leave out all mention Of the diiierential
; calculus ard its developments or TO write
! a treatise on the con .eyances of the
; present day and to include only pack
horses. stage wagons and stage coaches,
and TO omit all mention OF canals rail-
: roads and steamers, or to write trea-
z ! tise on mechanics and TO leave out all
me alton Of the steam engine.
"In fact banking credits, which are
goods and chattels.' 'vendible commodi-
ties and an inferior form of money
are now for all practical purposes the
current coin of the realm. And to show
, what a mass o. banking credits may b.
built up on a very slender basis OF
specie we may take the example OF dear
Z old Scotland, because II has the Desl
s organized system of banking in the world
| Ii appears by the last official accounts
| that with a reserve of gold OF f4,S66,5ll
the Scottish banks are able TO support
banking credits to the amount OF tS2,
l 2N,S5G These % millions of banking
e credits have exactly the same effects in
every respect as an equal quantity OF
gold. And wien, by well-organized
system of banking. IL is found possible
for all practical purposes TO multiply
less than 1--WE Millions of gold into more
than 90 millors. what becomes of the
baseless cry of the scarcity and appre-
citation of gold''
We would strongly commend to oui
readers the perisal of Mr.. McLeod's Sec
ond edition of this work, issued i'm ex-
tended form as days after his first edi'
= ton. Though dealing principally with
q, the European aspects of the bimetallit
issue. yet the principles he lays dowr
with so much dearness and logical force
apply equally q the question as 1t pre-
sents itself in this country. The STYLE
r of treatment is well adapted TO the aver
age reader. and the book should have a
wide circulation in the United States as
the best extant antidote to the eros of bi
$ metallism. Longnans. Green q Co. cas-
Fifteenth street are the New York pub
lishers.-New York Journal of Commerce
A REPLY 10 CLEVELAND-