The Redwood gazette. [volume] (Redwood Falls, Minn.) 1873-1940, 1896-01-02
ARNOLD ON SILVER.
Says It's Decentralization Caused
theyPresent Crisis.

promised to take up the cause of tn
present hard times and I now proceed
to do so. We have surely cause
enough to make us all open our eyes
! when wheat, our staple commodity il
the Northwest is below 40 cents pei
bushel. While gambling in grain mas
and does frequently affect prices o.
grain few cents per bushel, yet nc
one with an:average amount of com.
mon sense can be made to believe that
the present extremely low prices are
brought about by that pernicious
practice. =. Neither can watered rail
way stock, which.cause high freights
to pay interest on so much watered
stock, bad though such effect is, be
wholly to blame. These practices,
with some Others which might be
mentioned, are bad enough in their
effects, and no doubt considerably
lessen the returns of the producers,
and SO affectimany branches of trade,
yet who will b.. bold enough to assert
that these vicious practises are the
cause of the present hard times and
low prices. Neither can it be laid
wholly at the door of the tariff, for
many agricultural products fell to
the lowest notch under the Mckinley
tariff, the highest tariff ever known in
this country, nor can any tariff how
ever high raise the price of our ex-
ports. Neither can it be justly claim
ed that an overproduction is the cause
of our ills, since the worlds crop of
wheat is smaller than many other
years, when prices we're much higher
than at Epresent. While admitting
that the causes mentioned may have
a local and temporary effect on prices
of commodities in general, we make
bold to assert that their united in
1uence, has been small compared with
the influence caused by a contraction
OF our currency.
The great fundamental principle of
monetary science, and the law that
governs prices is this: The value of
the money unit depends upon the
ratio between the number of units in
circulation, and the volume of bust
ness to be done Herewith. This is an
axiom that no writer of any note in
monetary science will attempt to con-
trovert. I could give you many
authorities in support of this PROPOSE
ton but forbear as it would simply
be to multiply proof. I shall now
proceed to show that the hard times
from which we are now suffering are
caused by the contraction of our cur
rency. On the 9TH day of March,
1898, President Cleveland made the
remark that our country was about to
pass through a very trying period,
which remark, in the light of the
sequel, shows that he knew a panic
was to be sprung on the country, and
also how it was to be brought about.
On the 18th day of March, 1898, the
following circular was issued by the
Bankers Association to all National
banks.
Dear Sir: The interests of National bank
ers require immediate financial legislation
by congress. Silver, silver certificates and
treasury notes must be retired and the
National bank notes npon gold basis made
the only money. This will require the
authorization of from 500 to 1000 million
dollars of new bonds as basis of circulation.
You will at once retire one-third of your
circulation and call in one-half of your
loans. Be careful to make money string
ency felt among your patrons, especially
among influential business men. Advocate
an extra session of congress for the repeal
of the purchase clause of the Sherman law
and act with the other banks of your city in
securing large petition to congress for it's
repeal as per accompanying form. Use
personal influence with congressman and
particularly let your wishes be known to
your senators. The future life of National
banks as fixed and safe investments depend
upon immediate action, as there is an in
creasing sentiment in favor of government
legal tender notes and silver coinage
The Sherman law so-called, had in
creased the circulation of money and
general benefit was felt in 81 and '92
but the internal cold blooded National
banks saw the benefit and also saw
there would be reconciliation of
silver, and brought on the panic of
1893 from which we are still suffering
and will suffer till we get more money
in circulation. Here is corroborative
evidence. On page 1888 of the Chi
cago News Almanac, there is a table on