The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1896-09-23
EAs GOLD APPREorArEDP


John w. Ray of Southport. Ind, has
written to Henry Clews, Wall street,
New York city, for his opinion regard
ing the alleged appreciation Of gold. If
Invested of all prejudice and personal
interest Mr. CIews' opinions as such.
would probably be worth as much as
the opinion of any other man of sound
mind and ability to read-no more, no
less.
The opinion which he submits is such
as might be reasonably expected from
that quarter but the reasons therefor
are disappointing. They expose the
weakness of his cause in a way which
must be painful to the gold standard
seeker after information The Clews
letter in reply says:
1.-The great trouble with the silver
people is that they measure the price
Of gold by the price of products, and
because the latter have gone down ar
que that the price Of gold has gone up.
What they should do Is to measure the
price of products by the price of gold
(Which has a fixed value and is the
standard all over the world and they
in every country using gold have fall
len in price, owing to the supply hav-
ing exceeded the demand
It would be interesting to know how
the value of gold is to be ascertained if
1t is not measured in something else
and if not in commodities, what? But
says Mr.. Clewa, Gold has a fixed val
ue" Who fixed it and how was 1t
fixed? It must have been necessary to
compare 1t with something when fix
ing" its value. What was it? Fur
Their on in his letter he says:
THAT gold has deprecated in value
is proven by the fact that the holder
who puts it out at interest gets less in
come from it nowadays than he did In
former years. Whether 1t IS deposited
in bank, a trust company, or other
financial institution. invested in gilt
edged bonds, or put out on bond and
mortgage, the income returned is con-
siderabIy less. It was only a few years
ago that nearly all issues of railroad
bonds bore and z per cent, whereas to-
day the maximum rate on new issues
is 5 per cent, and in majority Of
cases the rate is 4 per cent"
This would be important if true. but
it is not true. Along about 1873 and a
few years thereafter the current rate OF
interest on farm mortgage loans in
Kansas for instance, was 10 per cent.
On a 81. 900 loan a farmer paid 800 an
nuaI interest, which required about 100
bushels of wheat or $50 bushels Of corn.
Now he can get the same loan for $50
a year but it takes 200 bushels of wheat
and 600 to 800 bushels Of corn to pay it.
Is it true then that the income on
mortgages is considerably less. The
owner of money is certainly getting
vastly more of almost all the necessar-
les of life in return for his investment
at low interest rates than he did when
interest rates were high. Mr.. Clews
says further:
Having proven that invested capital
gets less income than formerly, it
might be also well to state that i'm
proved property is as high, If not high
sr in all the cities and towns of the
country, than ever, and notwithstand-
ing the erection of countless sky scrap
or office buildings, dwelling houses, etc,
rents command top notch figures"
IF rents command top notch figures
how Is it that invested capital gets less
income than formerly?