The daily morning Astorian. [volume] (Astoria, Oregon) 1883-1899, 1895-06-16
THE VALUE OF MONEY.
(Prof. Laughltn.)

Prof. Laughltn)
The idea residing in the words value
OF money" seems to be particularly open
to misunderstanding. OF course, value
Is a relative thing. One article can have
exchange value only in comparison with
something else. Its exchange value is
the quarIbjty of other goods for which It
win exchange. Gold, for instance, may
be compared against corn. The value Of
23.22 grains of gold, expressed in corn,
10 the number of bushels OF corn It will
exchange for. The value of that gold "a
dollar) In general Us the quantity of goods
In general for which 1t will exchange.
Now, what follows7 1t must be as clear
as n whistle THAT value, since 1t is re.
latlon between two commodities, or
between one commodity, like gold. ana
all other commodities, Is affected by
any thing which touches both OF the
things compared. II the conditions
affecting corn change but IL nothing
whatever has changed the conditions
affecting gold then the relation between
gold and corn has been changed. That
Is, the value of gold relatively to corn has
been modified, even though nothing
whatever has affected the gold term. In
other words, gold can go up in value rela-
lively to corn, whenever. corn Is cheap
ened In cost, even though there Is as
much gold In existence os before.
II this explanation of value be kept
clearly In mind, 1t will be easy to see
why government stamp on money can
not fix its value. The stamp, certifying
that a gold coin contains 1922 grains OF
pure gold, Is not all that is needed ito give
10 the gold am exchange value; nor is 1t
even as essential Gold would have
.raI, oh
The stamp is only a convenience to save
Weighing and asSaying at every use of
gold The important thing, however is
the quantity OF things for which gold
will exchange. How does the mlnting OF
gold change the value Of gold In the
world. The value OF gold can be modi-
fed not merely by causes affecting the
supply and demand OF gold, but also
by causes affecting the cheapness and
delrnsss of all goods exchanged for
god. II goods are generally cheapened
IN cost, that means that gold buys more
goods, or prices fall; but 1t does not
imply that goid has been limited in
quantity For the cause changing the
value OF gold did NOT concern gold at all.
Then. II THE value of gold, which Is Its
relation to other goods, may be changed
by fluctuations In the cost of these other
goods, how can q government regulate
the value of gold? 1t is impossible for a
government to govern the varying costs
of commodities In general; 1t cannot say
that goods shall be made this year at
higher cost OF production, and next year
at lower cost of production. Hence It
cannot possibly control THE value OF
gold.
The difficulty in trying to control the
value of gold and silver becomes more
apparent, then, the moment we consider
what value Is. Since Ii Is a ratio to other
goods, the value of gold can be controlled
only by governing all the conditions of
supply of and demand for gold, and all |
the conditions touching cheapness or
dearness In cost of producing goods. To |
to control all the conditions
the processes Of production Is
absurd, And to suppose that merely !
gold does this Is still more alb
surd. But to attempt to control all the
OF supply and demand for gold
Itself Is quite as impossible for any gov
For instance, how could any |
government foresee and control the pro-
duotlon and supply of gold which sud
denly came into knowledge with the dis |
cover.es In California and Australia about |
1850? How, also could we foresee the |
Increase OF the gold product !
now going on In the African minesg This |
product has recently increased the total |
product of the world until II has reached |
\ greater amount annually than ever be-
tore in the history OF the precious metals.
Il Is evident, at once, that, even on the |
gold side OF the comparison, there are 7
,onditions OF tremendous importance TO
he value OF gold wholly outside the con-
.roi OF any governmental legislation.