The representative. [volume] (St. Paul, Minn.) 1893-1901, 1896-05-27
Is Copy Every House the Nation Trial Subscriptions Three Months 10 Cts Clubs More

cent of the whole And just as the mar
gin OF net earnings of any railroad over
and above fixed charges falls, the value
OF the mortgage securities falls, for it
I.resages a default OF interest if condi-
tiOnS do not improve
1t is true that those securities on which
interest seems secured appreciate in val
ue just as money appreciates, and thus
approaching money momentarily re-
bounds to the apparent profit of the saw
ings funds which have been so fortunate
to invest only in such securities. But as
prices go on falling and production be-
comes less and less profitable, the circle
of so-called gilt-edged securities grows
narrower and narrower, the savings
funds, with other investors, have mar
rover and narrower choice of securities
in which to invest their money and the
competition among them results in reduc-
ducing interest rates, SO that savings
funds are glad to invest today in munich
pal loans at and per cent where they
readily got or 6 20 or 80 years ago. And
receiving a low rate of interest on their
investments they can only afford to pay
low rate of interest to their depositorS.
So we find depositors of savings funds
adversely affected by an appreciating dol
lar, although it may add to the value of
some securities held by the savings funds:
first, in that it impairs the value of the
securities in which their moneys have
been invested and thus jeopardzes their
deposits, especially in such savings funds
as have loaned their money to productive
enterprises in the expectation of secur-
ing higher rate Of interest than munich
pal loans offer; and second, in that it
has forced down the interest rates at
which the savings funds can invest in So
called gilt-edged securities, and thus
forced them to reduce their interest rates
to their depositors. And the further
prices fall, the further this process will
be carried.
Restore bimetallism, and thus raise
prices and at once industry will become
more profitable; securities which savings
funds now hold and the value of which
has been impaired through the curtailed
profits of industry and the resulting ina
bility of debtors to earn and pay interest,
will again become valuable, demand for
money in productive industries will in
crease, thus drawing money from the
financial centerS, where it has sought and
will seek, so long as prices
show tendency to fall, In
vestment in that narrow circle
of securities interest on which seems as
sured consequently. interest rates will
rise, the saving funds will be able to loan
their money at more remunerative rates,
and thus will gradually be enabled to
pay higher rates of interest to their de-
pOSitOrs.
Therefore, the interest of depositors of
savings funds will best be served by are
turn to himetallism. Pursuit of the gold
standard will place them in jeopardy, for
no creditor can profit by running his
debtor Momentarily, the creditor may
profit from an appreciating dollar and
falling prices; but, sooner or later, an ap-
preciating dollar must force the debtor
into bankruptcy, and the creditor will
find the appreciating dollar that has
ruined his debtor will rebound to his own
ultimate loss True, the creditor may
take possession of the property of his
debtor; but the same disastrous fall Of
prices that made it impossible for his
debtor to earn and pay the interest will
make it equally impossible for the cred
itor to get any remuneration out of the
property.
There is only one class that can profit
by an appreciating dollar and that Is the
speculative class that manipulates in
credits. and thus is enabled, after having
taken the property Of their debtors by
foreclosure, to expand credits momen-
tarily, and thus lead to temporary rise
in prices, on which they can unload the
property they have taken from their
ruined debtors. The great purpose Of the
speculative cliques is not to secure a con-
stantly appreciating dollar, but rather a
dollar which they can control and cause
to fluctuate at will, in which event they
could raise or depress prices at pleasure.
Nothing would be so advantageous to
them, or so disastrous to producers in
general, as an irredeemable paper cur
rency over the volume of which they had
complete control.