Morris tribune., 1896-09-23
FALL OF PRICES.
NOT DUE TO APPRECIATION OF GOLD,
BUT TO CHEAPER COST OF
PRODUCTION.

Move" Theory with Silverites' Gold Has
Appreciated Theory-Measured by Price
of Labor, Gold Is Depreciating.
The Hon. David A. Wells, author OF
"Recent Economic Changes" and the
greatest American authority on the
pause of falling prices, has full page
article on this subject in the New York
Tribune of Sept. z. He finds that there
has been a universal fall In prices, aver
aging 80 or 40 per cent. since 1878, but
that it is only in this country that the
fall is attributed to the demonstration
of silver. Continuing. he says in part:
Granting, as every intelligent person
must, that the recent universal decline
in prices cannot be due to any local
agency, but must be attributed to some
universal influence, 1t is claimed that
such an influence is to be found in an
appreciation in the value or purchasing
power of gold, owing to its limited and
insufficient supply. and also that this
decline in prices followed the so called
decentralization Of silver in some coun-
tries, and the closing Of the minis in
other countries to its coinage.
The appreciation Of gold, helped by
an alleged enforced scarcity of silver,
and decline in price seem, therefore
to stand to each other in the relation OF
cause and effect, and the cause of tbs
advocates of silver has according!
the outset much Of plausibili.y. III
plausibility is not proof, nor,. sumpt%c
truth, as is strikingly illus;. ted By IT,
claim of the Rev. Jasper, FaS-'r e ne
First colored church in Rich. v..,,.
that "the sun do move" and the earIA
"do stand still, and who has mere
seeming facts in support of his faith
than can be adduced by the advocates
Of the gold appreciation theory-for
cannot everybody with eyes see the sun
move up every morning in the east and
move down every evening in the west?
And if the earth moves 10 miles every
second, as the astronomer bugs tell us,
would not every movable thing fly off
its surface as mud does from a revolv
ing carriage wheel? And as nothing
does fly off. is it not certain that the
earth stands still?
Investigation in the case Of the Rev.
Jasper and the advocates of the gold ap-
probation theory will, however, lead to
different conclusions. It is to be noted,
in the first place, that the advocates Of
the latter theory, in stating what they
assert to be the truth, never express
themselves other than generally, in all
that has been written or spoken in sup
port Of the gold theory ON either side Of
the Atlantic.
No one has ever been able to name
single commodity that has notably de-
clined in price within the last 80 years
and satisfactorily proved, or even at
tempted to prove, that such decline was
due to the appreciation Of gold. And
the reason for such default is that it |
cannot be done.
On the other hand, not single COM
modify that has notably declined in |
price within this time can be named in |
respect to which clear, abundant and |
specific evidence cannot be adduced in |
proof that this decline has been due to |
decreased cost Of production or distribu- |
tion or to changes in supply and de-
mand occasioned by wholly fortuitous
Nobody, furthermore, has ever risen
to explain the motive which has i'm
PEELED the honest sellers of merchandise |
all over the world during the last % |
years to take lower prices for their
goods in the face of an unexampled !
abundance of capital and remarkably |
low rates of interest, except for one or |
both Of two reasons excess of supply |
or diminished demand. Has any one
ever attempted to explain how it has
happened that during the recent period |
of the fall of prices the worlds stock of |
money, and especially Of silver, has been |
constantly increasing?
Is it not plain that a phenomenal de- |
cline Of prices in two parts Of the world, |
with entirely different monetary condi |
lions, must have had other causes than |
a demonstration of silver in the United |
States, which took place, if it ever did, |
a comparatively short time ago (repeal |
of the Sherman act in 1899, and which |
has not prevented nearly $500, 100000 !
of silver credit money from circulating |
in the the country at its full nominal
value?
That the price Of labor measured in
gold has not declined, but increased in
a marked degree everywhere in the CIV
ilized world during the last quarter of
a century, has been already commented |
on; hence if the purchasing power of
gold has increased during this period a
given amount Of it would have purchas-
ed more labor and not less, or, what is
the same thing, wages would have fall
en-, which they have not done.
Measured by the price of labor, gold
has unquestionably deprecated, and re-
cent careful examinations indicate that
the ratio of it's decline has been from
100 in 1878 to 83 in 1898. Measured |
also by the decline in the rate of inter
est on such established gold paying Sc
curities as British consols, the ratio has
been from 100 in 1870 to rs in 1896.
Can anybody suggest better measure
for testing this issue?
Has any one ever endeavored to ex-
plain how an appreciation of gold has
reduced the cost of railroad and water |