The Dalles times-mountaineer. [volume] (The Dalles, Or.) 1882-1904, 1896-08-15

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sATURDAY.... AUGUST Is, 1885,
SUPPLY AND DEMAND.
As a rule those who advocate
single gold standard refuse to take in
70 consideration the laws OF supply
and demand - being an element In
fixing values, and base their argument
solely upon the commercial values o.
metals fxed by legislation. In this
they become decidedly confused. They
recognize only gold as money metal
or the basis on which values are reck'
: oned, instead Of viewing both gold ano
silver as CONVENIENT. mediums OF ex
change, and on this account confounc
their statements In manner that con
fuses rather than enlightens the or
dinary seeker for knowledge. For in
stance 1t is stated that free coinage ol
silver at the ratio of 16 to /, means
!, that the owners-o of. silver will make 3
profit Of 81 per cent, by taking silver
bullion to the mint and having ii
coined into dollars. On the other
hand, it Is claimed that free silver
coinage means debased currency and
reduction Of the present purchasing
power OF the dollar to one half. Now
II the latter statement be true, the
former is untrue.
If the coinage of silver adds nothing
to its purchasing power, then its own
ers can make no profit By passing such
q measure. If, on the other hand, free
coinage raises the purchasing power
OF silver, so that silver owners make
the profit Of 81 per cent, it follows that
the assertions Of fsilverites that coinage
governs bullion values 10 correct.
Hence the charge that free coinage
means a depreciated currency is I'M
sound.
When the law declares that so many
grains Of gold or silver shall constitute
a dollar and become legal tender, 1t at
once opens an enormous & sld for their
employment and creates for them an
almost unlimited demand. Hence,
market values are governed by coinage
laws. OF course. If the coinage OF a
metal were fxsi below what its bull
lion value was before the coinage law
was passed, the law would be inopera'
tive, for no one would wish to sacrifice
part Of the commodity value OF his
possessions. THAI gold owes to legis.
lstion its high value to-day, no one
who has studied the question, and who
understands the law of supply and de-
mand, will deny. The value conferred
by law upon gold, is monopolistic
value, by which it is given an ex-
elusive privilege of settling debts. To
illustrate this proposition more fully,
let US suppose that the government
could pass law declaring that corn
should not be used as an article OF food
and that wheat alone should be con-
sumed as bread stuff. What would
be the result? The demand for wheat
would increase, and in consequence
the price Of wheat would advance,
while the price Of corn would go down
to the leyel OF the demand <for it
as commodity other than
bread stuff. Thus the law of sup
ply and demand would govern the
price of each grain. From wheat hav-
ins been declared tho only bread stuff,
the demand for it would increase and
consequently its price would advance,
while the deLand for corn having been
decreased the price would fall.' Then
to carry this Imposition further.
Suppose this state of affairs to existfor
twenty.three years, for instance from |
1878 to the present time. The holders
Of wheat would be able to demand |
whatever price they chose, and the
consumers of bread stuffs would be
forced to submit TO their demands,
while the holder of corn could only get
what was offered for his grain, since
It's consumption is regulated by legis-
alton. Then suppose. the discrimina-
ion against corn were removed, and it
we're allowed to beused as an article OF.
'ood, the price Of corn would suddenly
Use from an increase In the demand,
while the price Of wheat would fail,
since the demand for 1t would be
Iessened.
When the same laws Of supply and
demand are applied to gold and silver
as money metals, similar results will
be witnessed. In 1873, by an act OF
congress, silver was. oemonetized, or
In other words, was no longer recog.
nized as primary money metal. At
that time q silver dollor of 371.25
grains pure silver, or 4l2.5 grains of
standard silver, was worth sl.004 in
gold. But by that act the demand for
silver was decreased, and its price
gradually declined until year ago it
was worth only AL cents in gold. Or
perhaps more correctly speaking, the
demand for gold having been increased
by legislation its purchasing power was
to the extent that it would
buy twice as much silver as it would
before the latter metal was relegated
rom money metal to commodety.
Now Suppose this embargo against
liver shall be removed and it
hall be recognized as q primary
money, what will be- tbs result?
The demand for silver will be in.
creased and its price will advance.
While the demand for gold will be les.
'ened and its purchasing power will
all. The price OF both these metals
will then be governed by the law OF
iupply and demand. They will tend
o regulate each other, and as the
demand for one increases or diminishes
Is price will rise or fall. The final re.
Iult will be THAT the too metals will
circulate side by side, each governing
he price Of the other, and as the sup
,lY of silver in the world at the present
ime IS some sixteen ounces to one OF
,old, that is the price the laws of sup
,ly and demand would dictate If it
vere recognized as q primary money,
any legislative restraints.
Hence with legislative discrimination