The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1896-10-29

How Deprecated Currency Brought
Distress and Ruin Cpon the People
laing IL.

Dfstress and Ruin Cpon the People
lsing IL.
Following Is an extract from Ssarnuck.s
history Of Sweden, which gives an ac-
count OF that country's experience with
cheap money system.
subsequent TO the long wars OF Charles
MI in the latter part of the seventeenth
and beginning of the eighteenth centuries.
which reduced the population OF the king
acm considerably. the industries were
paraiyzed. and the scarcity Of money be-
came more apparent day by day
ne stlve~ and copper currency then in
circulation was nevertheless good money
The largest denomination OF silver cur
rency was the riks6aier. which was legal
tender. "a riksdaierwas Of about the same
size as the dollar of our daddies) THIS riks-
oaier In lis was considered equal in value
TO about daler in silver and six daler in
copper coin not legal tender. Subsequent
10 the year us one riksdaler became OF
equal value 10 daler silver coin or 2
oaier copper coin. not recognized by the
government as legal tender.
IN lsls the riksdaler was regarded OF
equal value TO s daler silver coin or Is
caler copper coin. From this IL Will be
seen that deprecated silver currency
has been sad experience of the Swedish
people. After Charles XII. returned from
his wars with Russia he called in the
assistance OF German fnancier. Mr.
Goertz. who was given full authority to
regulate the monetary system of the coun-
try.
Mr.. Goertx advised the coinage OF a
copper currency on an extensive scale.
He held TO the theory that the Swedish
government could establish its own money
system without detriment TO itself and
without an International agreement.
While he held that the riksdaler had be-
come too dear. he commended that an I'M
limited coinage of copper would bring
prosperity into the king iom. He held to
the theory that the unlimited coinage OF
copper would enhance the value of that
metal as soon as IL was known that the
government could by coinage change an
f-most worthless piece of copper into the
value of a one-half riksdaier.
Charles XII, however, was too shrewd
not 10 see the faliacy OF this system. Most
unwillingly did he consent. He would not
permit his likeness nor the insignia of his
country to appear on this cheap coin.
which soon became known as the coin of
distress and had for its result only mis-
cry and ruin.
at first decided to put only 1000 900 of these
copper coins into circulation. but since
the dangerous path had been entered
upon, this decision was soon lost sight of.
Already as soon as l7l7 600 Of this
cheap money was in circulation. and In
111s. when Charles XII. lost his life at
Frederickhall. nearly 4s.oo0.ooo of this
money had been coined. OF which about
$25 600, 000 were in general circulation.
The Inhabitants OF the kingdom were
by law compelled to accept this debased
coin against their wishes In payment OF
cid debts this copper coin answered very
WELL as creditors were compelled by law
to accept 1t as good money. But in pur-
chases the real value of the coin became
apparent. For instance. piece OF cloth
which could be bought for 4 daiers silver
money good money!. 80 dalers of this
cheap coin was asked. This brought about
a law compelling buyer and seller to &C
cept this coin at its face value. any viola
ten of which was subject to a heavy fine.
This law had for Its consequence that In
stead of this money being used in buying
and selling. commerce became an ex-
change of commodities. The cheap money
drove all good money out. and lastly all
silver money was withdrawn from circu-
lation The people were forbidden to use
the good coin.
"All those who had in their possession
silver coin of the kingdom or foreign
countries or silver bullion were required
before July. lis, TO deposit the same IN
the government bank and receive In ex-
change copper coin. If silver in any form
was found in the possession OF any citi-
zen OF the kingdom after the day named
il was forfeited TO the crown. AS a con-
sequence many who owned good money
deposited Ii In foreign banks. Then a law
was passed which provided how much
money a Swede might take with him into
other countries. This law. however, did
not have the desired effect. More than
400, 900 silver dollars were sent to foreign
ports In a short time. Others, who were
unable TO send their good coin to other
countries buried 1t In the ground. The
free and unlimited coinage of copper had
for It's inevitable result the disappearing
from circulation OF all good money. leav-
fated value.
AT the time of the death OF Charles
XII. the face value of this copper money
in circulation was not less than 25. 1868. 900
riksdalers silver coin and 1000. 900 in paper
currency. The unfortunate country was
flooded with practically worthless money
while the national debt was about co.
100000 riksdaler.
THE question then arose at to how this
debt should be liquidated. This question
was one OF the most important which came
before the Swedish riksdag In the year
11l9 1t was resolved at the sitting of this
riksdag that the so-caIled coin of distress
should be redeemed by the crown at rs
cents on the dollar, and this being done
the capardaier. which formerly represent
ed the face of one riksdaler. was again