Evening star., 1896-10-06
THE PROBLEM Of SILVER AND GOLD

quantity Of gold itself. "a
In the face Of these facts and the further
coins in tie country. and now have $780,
100000 In gold alone. or over twenty-four
times as much (while the population has
Increased only from about 100000 to
capita has increased steadily from 1885
In 1860. to $17.60 in 1870, $19.41 in $780, $22 81
in 1890, and $22.93 in 1895, it is idle to say
that the value of gold is increasing from
Bryan says. a scramble for gold.''
Why Gold Cannot De Cornered.
Any attempt to corner" gold would be so
easily met by an increase in its substitutes
that 1t Is absurd to allege that any such
property on which the substitute circula-
ton is based embrace all classes of people
and a large majority of the population of
the United States. for every depositor In
a savings bank. building association, or
trust company, any one who is member
OF lie insurance association or is In
sured in life insurance company, every
merchant and tradesman, and every one
who has accumulated any savings Is a
lender, and contributes to such substitute
circulation. 1t Is absurd, therefore, to say
that all these people. constituting the bulk
OF the population Of the country, are en-
gagged In any such attempt to corner"
gold. or are conspired to enhance the value
Currency and Property.
In this connection it is to be noted that
the arguments of the free silver advocates
overlook entirely the difference between the
word money as used to express coin or
currency. and the term money as used to
express capital or property. The difference
Is. however, vital and important. Capital Is
rot kept In the form of coin or currency,
because in that form it is not capable of
earning any gain or increase
No one, unless it be an inmate of an asy-
lum for the feeble minded, would keep gold
In strong box expecting to make a profit
by its increase in value when it will com
mand six per cent interest a year IL properly
invested and put into use.
Scarcity Of money in the sense of cur
rency Is an entirely different thing from a
scarcity of money" in the sense Of capital.
ne present currency circulation of about
Va per capita has proved sufficient in times
OF greatest prosperity and business expan-
sion, and there could be no greater amount
actually needed in times Of depression.
change to free silver basis, with cheap
3o-cent dollars, would inevitably be followed
ny the withdrawal OF gold from circulation,
great consequent contraction of the cur
rency, financial disaster, panics and dis
treSS.
Fallacy of Free Coinage Theory.
AS hereinbefore pointed out, the purchas-
ing power based on property, as shown by
the aggregate Of bank deposits subject to
check, is abou. three times the total volume
Of currency in circulation. Moreover 1t Is
so large in proportion to the annual product
Of silver tnat the latter Is insignificant in
comparison. 1t follows that when there is
d revival OF business calling for an Increase
IN the circulating medium, a slight increase
only In the value OF such substitute will SO
greatly exceed any increase that can pos
slbly arise from the coinage of silver that
no ri iDCr n
the demand for the coin correspondingly
small a". -
AS before stated, the purchasing power of
the country as afforded by bank deposits
alone. without counting the currency in cir
culation. Is about $4,000 100000. The total
annual product of silver in the United
States in 1885 amounted in coming value to
$64, 900. 600 ..
Assuming, therefore, that the entire an
| nual silver product Of the United States be
coined. this would increase the purchasing
power OF the country to an amount equal
to only one seventy-s.Nth of that afforded
by currency substitute alone.
Facts About Silver Production. B..
Similarly the silver product Of he world
in 1895 was s216,OOOOOO In coinage value
This Is about one twen.y-second Of the
amount of currency substitutes; and 1t
would require an increase of only one
twenty-second in the amount of such sub
gLined by the coinage of all Of It.
In view of these facts, is it PROBABLE that
the demand for silver to be coined into dol
lars would be SO large to absorb all of
! the silver product Of the worl1? Obviously
| not. for when an increase of business de-
mands an increase Of purchasing power
this will be produced in its most convenient
! form and no call for silver will take place
which will materially enhance its market
value.
| The present currency circulate being
about 81 5o0.O00.0O0. an Increase of popu-
| lation of per cent a year will call for an
| Increase of about s45,0Oo,0OO in currency
| per annum. as stated by Mr.. Bryan himself
| Quoting Mr.. Sherman). In. his speech of &C
| ceptance. In view of this fact. It is absurd
| to assert that there can be or will be de-
| mand calling for annual increase OF
$216OOO,OOO in the amount used of silver
| alone.
Silver Not Needed VIII Not Circulate
| A person having capital will not invest OF
lend it when there is a chance of loss
whether the capital he in the form Of silver
coin or in some other form. If the plans OF
the advocates Of free silver and a O-ceni
dollar were carried out, the additional dol
lars coined would not go into circulation
nor would they make money "easier,' ;
| cheaper" or more plenty, or start mil
or open a factory.
Moreover, money Is uniformly cheaper
| and therefore more plenty IN Sold lnan II
| silver countries. The cheapest money II
the world is in London where it is pei
cent per annum. In other gold countrle:
of Europe the rate is from to . per cent
In Mexico, China, Spain. India and othel
silver countries the rate is from II De
cent upward. In British Guiana (gold) III
rate is from to Per cent, while in thu
adjoining state of Venezuela (silver) th'
rate is from 10 to II per cent.
The conclusion is. first that the ALLEGED
shortage of the circulating medium doe
not exist, and, second, that the expansion
Of the currency will not relieve business
depression.
The Mint Value of Money.
Mr.. R. H. Steele. discussing the silve
question, writes to The Star:
There is one point OF considerable mo
ment In this question. which Mr.. Brya
has made the subject Of repetition In near
| ly every one Of his many campaign speeche
namely, and to quote his very words
that the reason why our gold dollar an
our bullion are worth the .same is becaus
the law says that you can convert the bu
lion into a dollar at the mint. When tn
laws are so under the free coinage of si
| of Gil, GA car