The times. [volume] (Richmond, Va.) 1890-1903, 1895-06-01
FINANCIAL QUESTIONS ASKED AND
ANSWERED..
Harrsonburg. Va. May %, 1895.

Harrsonburg Va. May p, 1895.
To the Editor OF The Times:
Sir.I have received much pleasure and
instruction from reading your articles on
the monetary question. but there are one
or two points on which ! wish you would
enlighten me.
!. Did not the decentralization of silver
in 1913 cause the drop in the price Of that
article. inasmuch as there IS now more
gold in the world in proportion to the
silver than there was at that time?
2 What was the sum of the legal-ten-
ger money-redempton money-in the
United States I'm 1873. and what IS it now
3. Does not the lessening of the primary
money i'm existence cause drop In prices
and make it harder to pay debts?
We would say IN answer TO our cor
respondents first question that all that
is to be said is TO give what we con-
slider the best opinion upon the subject,
and that is that the decentralization Of
silver In 1879 by the United states 0here
was really no demonotization), had very
little. if anything, to do with the fall in
the value Of silver Silver began to fall
in value in 1866. The fall was IN our opin-
ion. due to two causes. The improvements
in methods of transportation and con-
veyng intelligence had gone to such
point that the need for actual money in
the transactions of the civilized world
had enormously fallen Off
Business had come to be done almost
exclusively by transfers Of credits on the
books of banks and merchants Men
had no need for both gold and silver
as money metals Except that silver was
wanscd for change), and being given
their choice they took gold This enor-
mously diminished the demand for silver.
But by one Of those curious freaks in
human affairs that can never be antici-
pated. Just as the diminished need for
silver began to display itself, methods
for mining 1t and extracting ii from the
ores were very greatly improved, so that
il became possible TO produce silver at
greatly decreased cost. The demand.
therefore fell off while the supply in
creased and this caused the fail Of sill
yer. in our opinion.
In answer TO our correspondents second
question we would say that in 1873 We
were on a paper basis. and all the legal
tender money in use at that time was the
Governments "grcenbacks" legal-tender
Treasury notes. We have no reference
at hand for the amount of these then
outstanding. but Il is no more than $780,
100000. In 1876 1t was ss67,525, 7ie.
We have now SSie.oOooo Of greenbacks-
legal-tcnder notcs-about $625 10000 OF
gold coin. and about Seoooo,ooo of silver,
coined and uncoined, making over $1,000
10000 of legal tender money. as against
less than SioO.W0O00 in 1873.
As for our correspondents third ques-
ton we have this TO say: There must be
enough money 1--WE are not speaking OF
paper currency TO answer the needs OF
a countrys business or prices viii not
he at their normal level. In highly civil
lied countries the amount Of this money
required is comparatively small. II there
is any more after this amount is seeureF
prices will be apparently higher. but 1t
will he apparent only. The real thing
accomplished will be a depreciation in the
value OF money which will be expressed
In higher prices for commodities. But
those nominal higher prices will not make
a bushcl of wheat exchange for any more
corn and 80 of all other commodities.
But we have recently discussed this
subject so fully in our articles reviewing
Coins Financial school, that we cannot
go Il over again.