The Monitor-register., 1896-05-08
The Money Question.
SHARpTowN, NJ. NAV Z. 1896

SHARPTowN, N. j., May Z, 1896.
EDITOR OF Observation-Disclosures :-In
the opinion of possibly a majority of
citizens the currency question is the most
vital one before the American people for
discussion and just decision. 1t will
inevitably be an important factor in the
pending Presidential campaign, and
believe every q will welcome reliable
information and logical reason, coupled
with concise and lucid statement. upon
this subject. As a contribution to such
Information l forward some monographs,
written by an able bimetallist, discussing
the stock arguments of the gold standard
men. | trust you will fnd room for them
and for any equally able argument In
opposition you may receive.
]. WALTER PANcoAsr.
INTRINSIC VALUE BY A. J. WARNER.
PRESIDENT AMERICAN BIMETALLIc
LEAUGE.
"Nothing can have an intrinsic value.n
Barton, in 1896.
10 LII bucu tulUR as lQtrll81C
value PROF. Jecons.
cit Gi%nstrinsic value1 is the curse and
the bane of economic science to this yerv
hour."-MacIsod.
Although for two hundred years writer's
on political economy have secuted the no.
lion that value is sintrinsic in anything,
still this notion continues to be 'ithe bsne
the curse of economic SCIENCE" 1t
holds much the same relation to the
science OF economics that the idea that
the world is fiat holds IN geography and
astronomy; only the Jaspers in economics
are far more numerous than their kindred
in astronomy.
Ii value were intrinsic, that is, inherent
IN 8 thing, then of course, it could not
cnanRe; IL would he the same everywhere
and at all times. If values were intrinsic
10 anything, 1t would be in commodities
IKE IRON, wheat or cotton. But If the
value OF these things were intrinsic, 1t
would OF necessity be the same in all
places-that same in Chicago, New York
or London-which is never the case. If
the value of gold, as is 80 often assumed.
were intrinsic, like its color or its quality
of ductility or mallea bility, it could not
change, but would be the same from age
" UAo3 ~ WOulu NO lilo bhm6 Wu6tu0T
there were little or much of it in the
world. No Increase in the supply of gold,
no matter how great, n no reduction.
even to half the gold in the world, could
affect its value. 1t must in that case be
the same in all countries and at all periods
of time, regardless of supply or of
demand for it, and regardless Of whether
1t Is used for money or not. The same
Il 10 truQ nf Siluop TT sto uaIna 10 sukus-.sr
it cannot change, nor could the relative
value of silver to gold, or of gold to silver,
change. But we know they have changed
in value relatively to each other, and re-
latively to other things, and are changing
all the time. We know historically and
experimentally that these metals, like
everything else, vary according to the law
of supply and demand. If the quantity of
| gold or of silver were suddenly doubled,
its value would be reduced in proportion
to the change in the relation Of supply
and demand. On the other hand, should
the supply of these metals, or Of either of
them fall off, while the demand for them
| kept up, their value would proportion
| ately increase. The sam would be the
case if the demand for either metal
should increase while supply remained
unchanged.
When, however, either gold or silver
can be used without limit in the payment
of debts at the option of the one having
| payments to make, then the lack of
supply of n may be made up by an
increase in the supply of the other. In
| this way the two metals act as one, and
the value Of the two metals combined
| will vary as their mass varies in relation
to the demand for the whole. This is
! B~imetallism. The rate at which one thing
will exchange for another expresses the
value of one thing In terms of another.
Hence the val1e of one thing is anything
| else for which it will exchange even. The
value of anything expressed in money is
called price. The price of a thing, there
fore, is the quantity Of money it will OK.
| change for. Hence, whatever cause
| Affects demand in relation to supply,
affects value;whatever cause affects supply
In relation to demand, affects value;
whatever cause affects the supply of
money, as compared to demand for 1t, or
as compared with things to be bought
and sold, affects the price level generally.
Legislation cannot change the intrinsic
value Of anything, but Law may, and
often does, affect the supply of. or the
| demand for, q thing; and when the law
took away the demand for silver for
money and increased the demand for gold
by making it the only money of final re-
demption, it did most seriously affect the
value of these metals.
The truth, then, is that the value of
| gold and silver, like that of everything
else, depends entirely on the relation Of
supply to demand, or of quantity to use.
| Or as John Locke said two hundred years
ago, sintrinsic value in money is there
| fore nothing but its quantity"
This Law applies also to money of AMI
kind, and, therefore, in general, the value
of money depends on the quantity of
money as compared with things to be
bought and sold, or the work to be done
by it. Prices, therefore, depend on the
| volume of money, or, as Professor Mich
| olson states the law, "The general level
| of prices depends on the quantity of
money compared with the work Of oircu-
lation to be done by it." As the chief
| value of gold or of silver is for money, it
| follows that the chief value of these
| metals comes from the demand for them
| for money, and that any change in the
monetary use of either of them must
necessarily affect its value.
When, therefore, we hear people talk
| of intrinsic" value, it may be set down
at once that they are as ignorant of the
principles of money as they would show
themselves to be of geography or astrono.
my if they talked of the earth as IL it were
fiat.