Freeland tribune. (Freeland, Pa.) 1888-1921, 1896-04-20

of exchange. A money of superior con-
venlence is a greater necessity to COM
merce than a money of absolute intrin-
sic value.
Primary money or money of intrinsic
value is comparatively little used. The
business of the world is practically done
ON paper. Banks are but corporations,
their drafts being based as much upon
the checks of individuals, firms and
manufacturing and mercantile corpora
tions as on currency.
| The check of an individual, firm or
corporation passes current not so much
apon general knowledge Of the bank ac-
count as upon the knowledge of the
whole wealth of the issuing party,
which in morals and law is a guarantee
of the payment of the check.
The fiat dollars of the government
are not taken unhesitatingly at par be-
cause of knowledge that there is in
the treasury gold, dollar for dollar Ev-
cry one knows that there is not 81 in
| gold in the treasury for every $40 of the
| governments promises to pay. All
know, however, that there is behind ev-
cry fiat dollar of the governments the en-
tire wealth of the nation.
| The powers of taxation of the govern
ment are unlimited. 1t can take from
one and all within its territory their last
atom of property, if necessary to re-
deem its promises to pay. That fact,
and not the comparative paltry amount
of gold and silver stored in the treasury,
is what keeps the governments promises
to pay at par. In this respect it is no
different from an individual. A mans
checks and promissory notes remain at
par so long us it is known that his total
wealth, not his bank account merely,
exceeds them in amount.
As to the actual value of paper money,
it makes no difference whether it is sus-
tanned by individual or governmental
fiat. The test is the real wealth that is
its guarantee. That the government fiat
is the better and more desirable is be-
cause the governments wealth is the
greater and its amount is more accurate
ly and universally known. This latter
is what inspires tho necessary confidence
that makes it acceptable.
This matter of confidence is the weak
feature in all fiat money systems. Be-
fore postotfiCes and post roads, ships and
railways, telegraphs and telephones, the
means of communication were so slow
that dynasties were overturned weeks
before the remote portions Of the empire
| knew that new emperors ruled. Banks
failed, and it was months afterward be-
fore their bills became worthless in dis
tant provinces Hardness in the dis
semination of intelligence created mis-
trust i'll the value of all money that did
not carry its real value within itself.
Coin consequently has attained firm
position in the commercial world as the
only safe money. Its inconvenience,
however, prevents its becoming the only
money. 1t is, i'll truth, but final money.
1t is not a circulating medium in the
large Or the popular transactions of COM
merce, The subsidiary silver, nickel and
copper coins are the only mintings that
freely circulate. Silver dollars are too
large and heavy. Gold coins are too
scarce.
Final settlements between largo finan.
cial houses and between governments
are effected in bullion. You deposit in
any of the large banks or with the
treasury of any nation a quantity of gold
coin, and you are credited with its
weight value only. This was once true
of silver coin also. 1t would still be true
had not the fiat in a silver dollar become
so large portion of its stamped value
that any deficiency i'll weight is now of
no more consequence than would be
deficiency in the weight of paper in
treasury note.
Now, if coin is but final money, and
as such it is treated only as bullion,
what is the sense of coming it? Why not
have the government stamp each brick,
pig or ingot presented with its weight
and purity simply? II the party present
ing the bullion desires to store it with
the government and wants a circulating
medium or certificate of deposit in ex-
| change give it to him. The government
treasury, as far as gold is concerned, is
but a warehouse, for it takes it in and
pays it ont as bullion value.
The government gold warehouse
certificate would pass as current as the
bullion Itself, as the bullion could al
ways be secured when it was desired.
]
all that is offered stamp its weight and
fineness upon it, and issue warehouse
certificates against it.
Make one class of these certificates
legal tender. 1t makes no particular
difference which. This would change
the money nomenclature, but names are
only conveniences We would not have
| dollars and fractions thereon, but the
unit would be grain and its multipliers.
Hence transactions would be made in
grains of gold, or according to the
metric weight system. An individual
promissory note would read: "Thirty
days from date 1 promise to pay John
Doe 10000 grains of gold (or 800, 900
grains of silver, if silver is made the
standard), with interest at 6 per cent
per annum. Value received" " Prices Of
/ all artip1as won Ia ba rapl-pnp6 in grains