The representative. [volume] (St. Paul, Minn.) 1893-1901, 1895-06-12
CAUSE OF FALLING PRICES.
REPORT OF A COMTITTEE OF
SEVEN APPOINTED TO IN
VESTIGATE 1T.
Action of the Grocers' and Import.
ers' Exchange of Philadelphia
A Representative Body of
Active Business Men.
IN FAVOR OF BIMETALLIS NJ.

IN FAVOR OF BIMETALLIS NJ.
A special meeting Of the Grocers'
and Importers Exchange of the city,
held last week, adopted the following
report, presented by committee of
seven, composed of David McMena-
min, Chairman; Joseph Thompson,
Joseph F. Haegele, N. J. Schmucker,
Arthur L. Terry, Horace Krause and
Henry A. Fry, Secretary.
TO the resident and Members of the Gro
GERS and Importers Exchange.
GENTLEMEN:-You committee ap-
pointed to ascertain how far and in
what way this bod y can aid in abating
the evils resulting from the continual
shrinkage Of prices, and whether any
thing can be done to stop this conttn-
ual shrinkage, and to report at a
| meeting to be called when they are
ready"
Respectfully report as follows:
This committee could see no way of
abating the evils alluded to but by re-
moving the cause. The question then
arises, What is the cause? We are
aware that prices rise and fall in ac-
cordance with the law of demand and
supply, but also saw that there was
| something abnormal in a decline in
| values which had continued for over
twenty years, more or less, steadily,
| and they knew that unless some new
power was at work the law Of demand
and supply would work remedy for
either high or low prices in less time
than that. The testimony brought
| before this committee proves fact
that the people in general are apt to
overlook, i. e. that money also obeys
the laws of demand and supply. IN
til we turned our attention to this
! fact we could find no cause adequate
| to the calamitous fall in prices.
Our attention being called to the
axioms of political economy, we began
to see the light on this sAbject:
"Double the volume of money and
you double the value of products"
"Divide the volume of money and
you divide the value of products.
"Divide the volume of money and
you double the debt"
Double the volume of money and
you divide the debt"
These maxims in political economy
are not now disputable. They are as
we'll proven as the rules that guide us
in arithmetic. Let us apply these
axioms and see if they explain the
situation. To use round figures the
metallic money of the world is esti-
mated at near eight billions, or, as
others express it, eight thousand mil
lions Is. ,0OO, ,O00) of dollars, half gold
and half silver. In 1873 the United
States and Germany closed their
mints against silver and struck it
from the list Of moneys. That is, sill
yer was no longer money of final re-
demption. True, Great Britain had
| demOnetiZed silver in 1916. but until
the leading nations in 1873 joined
them the effect of their action was
scarcely perceptible. 1873 then is in
time the vital point when the effect
of dividing the volume Of money be-
gan to be effective.
"Divide the volume of money and
you divide the value OF products
Every nation that demonetized sill
yer added to the division Of the value
of products until the produce OF the
! land was reduced to half it's former
price, and as produce is what pays
debt another scientific axiom is seen:
"Divide the volume Of money and
you double the debit
If anyone is curious as to the where
fore of this, here it is: Gold obeys the
law of demand and supply as Loyalty
and as promptly as any other COM
modify whatever. Now place the
function Of money Of ultimate re-
demption on gold alone and you
double the demand for it, and as you
cannot double the supply you double
it's value. You have to give as much
produce for s. as you fOrmely gave for
$40.
The members Of the Grocers' and
Importers Exchange need not be in
formed as to the movement in prices
during the past twenty-five years.
They know it to their cost. Many per-
sons assert that it is not gold that nas
risen, but silver that has fallen. Pro-
fessor Sauerbecks tables dispose OF
that assertion. We here quote them:
Index numbers of forty-fve princi-
pal commodities and silver by Pro-