The Goodland republic. [volume] (Goodland, Kan.) 1891-1907, 1896-07-17
A QUESTION ANSWERED.

coined without limitation, and that
paper replies that the underlying
though with those who ask this ques-
ton seems to be that inasmuch as
there is a large amount of money lying
idle now there is no occasion to pro-
vide for any more. That idea carried
to its logical conclusion would also re-
quire the minis to be closed to gold,
for it is a well-known fact that but
very small portion of the gold now
in the country is in actual circulation.
Hence, we might inquire, "why coin
any more?" Nevertheless, a PROPOSE
ton to stop coming it would bring a
storm of protest at once.
The fact is that whether a country
has much money or little there is al
ways some of it lying idle. In India
and China where the money in actual
use is very scarce there are vast sums
boarded away. And, strange as it may
appear at first glance, it is neverthe-
less true, that where tbs supply of
money is insufficient to keep pace with
the wants of trade the amount of IN
employed will be larger in proportion
than where the supply is ample,
A very little intelligent thought will
disclose the reason. When the money
supply is diminishing either actually
or relatively, it means lower prices
for products. Lower prices mean
smaller profits, no profits at all, OF &C
tual loss. Hence people having money
will not invest in productive enter
prises, They will buy gilt edged Sc
curities, employ it in purely speeula-
tive ventures in stock exchanges and
boards of trade, or if conditions be-
come too bad they will lock it up for
safe keeping.
These are the conditions which now
exist in the United States. For many
years, ever since the decentralization
of silver in 1873, business has been
done on a falling market and more
and more money has been withdrawn
from actual employment.
Now for the effect of free coinage
upon the circulation. The first effect
of opening the Americant mint would
be to raise the gold price of silver to
s1,29 per ounce. Leaving ont of con-
sideratiOn the question of whether
parity could be permanently main
tanned it is perfectly plain that in the
first instance silver would go up to
the mint rate in gold for the simple
reason that no man in his sane mind
would take any less for it. The sec
Ondary, almost coincident effect, would
be to raise the price of all those
products, such as wheat cotton and
petroleum that are sold in the Euro
pean market at silver prices. This
means a corresponding rise in the
American market, to be closely fol-
lowed, as is always the case, by a sym
pathetic rise in the price of other |
things of a similar character and oc-
cupying a common field. AS, for ex-
ample, a general rise of wheat would |
undoubtedly be accompanied by a !
rise Of corn, rye, barley, buckwheat, |
etc. So the price of Gotten has its ef-
feet upon the price of wool. If the |
price of cotton goods takes a sharp |
and long continued decline it is in
evitable that wooden goods will follow
more OF less closely, because cotton
goods and>woOlen goods in measure
compete with each other. So do a |
great many other things, and subject, |
Of course, to exceptional influences,
there is a general tendency of all |
prices to rise and fall together. So the
mere rise in the market price of silver
bullion consequent upon the opening
Of the American mint would give q
general upward movement to prices
and especially to the price of our
agricultural staple.
This would necessarily bring out for
investment large sums of money now
lying idle, for investors always seek a |
rising market. Again, the silver de-
posted at the minis would be struck /
into coin and the coin handed to the
owner, who in turn would pay it out t
to others with whom be has business.
Thus it would find its way into general
circulation, swell the volume Of money,
stimulating prices and business at the
same time, There is never any trouble
about getting money into circulation
when business conditions are heslthful, /
and an abundant supply Of good
money is always productive Of health
full conditions.
One thing should be entirely clear.