The aegis & intelligencer. [volume] (Bel Air, Md.) 1864-1923, 1896-10-23
QUESTION OF OVER-PROOUC-
TON

In "a remarkably able 81 eech at
Springfield, Illinois, Mr.. W. H. Harvey
author of Coins Financial School,"
says:
''They say that improved facilities
is what has wereda-prices.-----~ o'-
This answer is this: From 1850 to
1878, and especially from 1860 to 1873,
were the greatest years of improved
facilities this country has ever seen.
And, yet, in the face of improved
facilities, prices advanced. We had
all of the improved machinery for
farming, prior to 1878, except the self
binder, and yet, in spite of these i'm
proved facilities and lessening cost of
harvesting, the farmers products in
creased in price. The reason was
this: While improved facilities were
creating more property, it was also
creating larger production of the
two precious metals. The prices l re-
fer to were the rising prices in the
worlds markets. The cost of produc-
ton is not what makes prices. Prices
are made by the relative quantity and
demand therefore of property and
money. One is seeking investment in
the other, and their relative quantity
and demand therefore, regulate their
relative values. Improved facilities
may cause over-production of a pro-
duct, and in this way, by over-supply,
lower its value. But industrial his
tory shows that there is no such thing
as overproduction for as long a period
as three years, and seldom for two
years. The producers of the world
have their hands on the pulse of the
markets and shift their energies TO
those things for which there is a de-
mand. If you cannot at once grasp
this teaching of industrial history,
you can, what | am about to say: 1t
is this: There is no such thing as
reproduction when there are tens
of thousands of our people going
hungry and half clothed.
Improvements make new demand
for labor Railways have set tens of
thousands of people at work with IA
new occupation. Gas and electric
light plants, from the manufactures
who make the improvements to the
men employed in operating them,
multiply the number employed far
beyond the number engaged in max
ing the lamps and tallow candles they
had superseded.
THE QUANTITY OF MONEY.
They say we have as much money
now per capita as in 1873. The answer
is this: 1t is true we have in gold and
all forms of credit money as much per
capita as we had in 1873. But over
two-thirds of this money is credit
money, and less than one third is gold
or primary money. 1t is, therefore,
top heavy. 1t shakes confidence in it
all. Primary money fixes the sea
level of prices and will support only
an equal quantity of credit money;
any greater issue of credit money does
not help the situation, but on the
contrary, it is harmful. We have less
than one-half.as much primary money
nowas we had per capita in 1878. We
have only half as much sound money
now as in 1878 When you consider
the money boarded up in bank vaults
not to go again into circulation, except
in the form of loans, which is hurtful
there is not to exceed five dollars per
capita in circulation to-day in the
United States 1t is not money to
loan that gives healthy tone to bust
ness; it is money seeking investment
-Durchases-tha benefits trade