Little Falls weekly transcript. (Little Falls, Morrison Co., Minn.) 1894-19??, 1896-09-18
WHY PRICES HAVE SHRUNi<.

1873, population, production and COM
merce have continued to grow and extend
The use for money has increased. That
is, there has been more work for it to DO
and the work has been extended over
greater areas. II both silver and gold had
been fully utilized the production of these
metals would not have supplied q sufh-
cheney of standard money to wholly main-
tain prices. 1t Is safe to say, however,
that with the larger basis for safe credit
which the use of both would have at
forded, the fall in general prices would
have been slight. With silver discarded
as standard money, the basis for credit
has been contracted and prices have had to
shrink to come within the range at which
the exchange could be effected by the
quantity Of standard money available and
the credit which it could safely maintain.
A single illustration Is sufficient. Our
Minnesota wheat crop this year Is estl.
mated at 100000 bushels. At 81 pen
bushel it would take twice as much
money and credit to handle it as at pres
emit prices As there is not enough coin tc
furnish the necessary money and to sus
tain the needed credit available for han.
ding wheat at that figure, prices HAYS
had to shrink to Ming them within the
amount Of money and credit available for
handling It, ut
What is true # wheat is substantially
true of all prot is. Il is this shrinking
process, this necessity for larger amount
Of exchange and products to be expressed
in relatively smaller amount of money
and credit, that causes the continued fall
In prices and is responsible for the fore
closure notices and the failures which i'll
our papers. But, say our opponents, it ia
hot the want Of money, 1t Is the want Ct
confidence that makes the times hard.
grant 1t. But, let me ask, the lack Of con-
fldence in whatf In our money! No, our
money is 90 good that it takes two bush
els of wheat to buy the silver dollar where
it used to take only one. 1t is want of
confidence In business - In production.
You can safely challenge any man to point
out line of industry today that promises
profit unless 1t enjoys monopoly. Fall
ing prices and prosperity cannot exist to-
Rether. It is this condition of affairs that
has silenced the mill, closed the shop, and
turned hundreds of thousands Of efficient
workers into idlers and tramps. Speaking
Of the results of fall in prices, Processes
Marshall Of Cambridge university says: ID
Il "a fall in prices lowers profits and i'm.
poyerishes the manufactures, while it in.
creases the purchasing power Of those who
have fixed incomes. So, again, it en-.
riches the creditors at the expense of the
debtors; for II the money that is owing to
them is repaid, this money gives them
greater purchasing power, and if they
have lent 1t at fixed rate of interest each
PAYMENT is worth more to them than 1t
would be If prices were high. But for the.
same reason that it enriches creditors and
those who receive fixed incomes, 1t i'm
poyerishes those men of business who
have borrowed capital and 1t impoverishes
those who have to make, as most business
men have, considerable fixed money pay
ments for rent, salaries and other mat
ters." 8
The fall in prices since the demonetiza-
ton Of silver Is nearly 80 per cent, as IL
shown by our statistical reports, and no
one can assert, and give valid reason for
his assertion, that we have yet reached the
bottom. Less money and narrower basis
for credit relative to the amount of work
for it to do always has and always will
produce lower prices. Six years ago, on
the floor of the house Of representatives,
stated it as my conviction that If we
ceased to utilize more silver for coinage
wheat would sell for 40 cents bushel In
Minnesota. Not dollar Of new silver
has been added to our coinage in three
years, and 40 cent wheat Is upon us.
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