The Columbian. [volume] (Bloomsburg, Pa.) 1866-1910, 1896-04-16

Df exchange. A money of superior con-
venience is greater necessity to com
merce than money of absolute intrin-
sic value.
Primary money or money of intrinsic
value is comparatively little used. The
business of the world is practically done
on paper. Banks are but corporations,
their drafts being based as much upon
the checks of individuals, firms and
manufacturing and mercantile corpora
tions as on currency.
The check of an individual, firm or
corporation passes current not so much
upon general knowledge of the bank ae-
count as upon the knowledge of the
whole wealth Of the issuing party,
which in morals and law is guarantee
Of the payment of the check.
The fat dollars of the government
are not taken unhesitatingly at par be-
cause of knowledge tlrat there is in
the treasury gold, dollar for dollar. Ev-
cry one knows that there Is not 81 in
gold in the treasury for every $40 of the
governments promises to pay. All
know, however, that there is behind ev-
cry fat dollar Of the government the en-
tire wealth of the nation.
The powers of taxation of the govern
ment are unlimited. It cg1 take from
one and all within its territory thoir last
atom of property, if necessary to re-
deem its promises to pay. That fact,
and not the comparative paltry amount
of gold and silver stored in the treasury,
is swhat keeps the governments promises
to pay at par. In this respect it is no
different from an individual. A mans
checks and promissory notes remain at
par so long as it is known that his total
wealth, not his bank account merely,
exceeds them in amount.
As to the actual value of paper money,
it makes no difference whether it is sus-
tanned by individual or governmental
fat The test is the real wealth that is
its guarantee That the government fiat
is the better and more desirable is be-
cause the governments wealth is the
greater and its amount is more accurate
ly and universally known. This latter
is what inspires the necessary confidence
that makes it acceptable.
This matter of confidence is.tbe weak
feature in all fiat money systems. Be-
fore postoffices and post roads, ships and
railways, telegraphs and telephones, the
means of communication were so slow
that dynasties were overturned weeks
before the remote portions of the empire
knew that new emperors ruled. Banks
failed, and it was months afterward be-
fore their bills became worthless in dis
tant provinces. Tardiness in the dis
semination Of intelligence created mis-
trust in the value of all money that did
not carry its real value within itself.
Coin consequently has attained a firm
position in the commercial world as the
only safe money. Its inconvenience,
however. prevents its becoming the only
money. 1t is, in truth, but final money.
1t is not circulating medium in the
large or the popular transactions Of COM
merce. The subsidiary silver, nickel and
copper coins are the only mintings that
freely circulate. Silver dollars are too
large and heavy. Gold coins are too
scarce.
Final settlements between large finan-
cial houses and between governments
are effected in bullion. You deposit in
any of the large banks or with the
treasury of any nation quantity of gold
coin, and you are credited with its
weight value only. This was once true
of silver coin also. 1t would still be true
had not the fiat in silver dollar become
so large portion of its stamped value
that any deficiency in weight is now of
hor ha
deficiency in the weight of paper in
treasury note.
Now, if coin is but final money, and
as such it is treated only as bullion,
what is the sense of coming it? Why not
have the government stamp each brick,
pig or ingot presented with its weight
and purity simply? If the party present.
ing the bullion desires to store it with
the government and wants a circulating
medium or certificate of deposit in ex-
change, give it to him. The government
treasury, as far as gold is concerned, is
but warehouse, for it takes it in and
pays it ont as bullion value.
The governments gold warehouse
certificate would pass as current as the
bullion itself, as the bullion could al
ways be secured when it was desired.
Treat silver the same as gold. Accept
all that is offered, stamp its weight and
fineness upon it. and issue warehouse
certificates against it.
Make one class of these certificates
legal tender. 1t makes no particular
difference which. This would change
the money nomenclature, but names are
only conveniences We would not have
dollars and fractions thereon, but the
unit would be a grain and its multipliers
Hence transactions would be made in
grains of gold, or according to the
metric weight system. An individual
promissory note would read: "Thirty
days from date promise to pay John
Doe 0,O00 grains of gold Tor 800, 900
grains of silver, if silver is made the
standard), with interest at per cent
per annum. Value received. +" Prices of
all articles would be reckoned in grains
instead of cents.
The f1uctuation in the market value