Catoctin clarion. [volume] (Mechanicstown, Md.) 1871-1940, 1896-05-14
SOUND MONEY DEFINED.

Mercantile Value ~ bulla0ns
The Iron Ago is the leading trade
journal Of the iron, steel and hardware
Industries. It defines, in Its issue Of
April l6, sound and unsound money as
follows:
Some resentment Is shown on the
part Of believers in silver dollars and
other forms Of cheap money at the ap-
plication Of the term Sound money"
to money based upon the gold standard
But this use Of the term Is not mere
begging Of the question. There is q
reason for it which even an opponent
can understand
Money whose value is the mercantile
value Of the metal 1t Is made Of, whose
value is not impaired by the deface-
ment Of its inscription, or even by melt
ing, so long as its quantity and purity
remain unchanged, is certainly much
sounder than money whose value de-
ponds upon the ability and the intention
Of its issuer. This makes specie Sound"
money In distinction from paper. But
the economy and convenience OF using
paper have been thoroughly established
BY long and wide experience, and It has
been found practicable to make the pa
per, through the process Of redemption,
as safe and sure as anything human, so
that paper rcdeemable in specie is not
only much sounder than paper not re-
deemable, whose volume and whose
purchasing power are liable to be affect
ed by accident and whim, but 1t Is alb
solutely sound in the sense In which the
metal that redeems 1t Is sound
But this does not explain why the
silver dollar should be unsound money.
This coin is unsound because 1t circu-
lates at its nominal value Of gold due
to the limitation in the supply and the
declared policy Of the government So
long as the public does not have to take
silver dollars and the SHERMAN" notes
are redeemed in gold, and tho silver
certificates are in strictly limited sup.
ply, the silver dollar and its paper rep
resentative can be kept at par In gold,
but the coin is an instance Of unsound
money because half It's value depends
ON the acts Of the government, whose
ability has been moro than once brought
in question, and whose disposition would
be changed if the silver men could get
control
Were coinage Of silver made free
that is, were the restriction on the man
ufacture Of silver dollars removed-the
silver dollar would drop from the value
Of the gold dollar to the value Of the
metal in the silver dollar. That coin
would then be all instance Of sound
money, but it would become such only
by the shrinkage Of nearly one-haf in
the money unit, the measure Of all
values. AS the tendency Of this would
be to initiate prices and to impair by
one-half the obligations Of contracts Of
q financial character, to create the ut
most uncertainty regarding the future
and to dry up the fertilizing streams OF
credit, 1t would throw the business
world into such chaos Of which only q
slight threat was felt by the country In
1893, the effects Of which have not
fully passed away.
While the silver dollar, as In Mexico,
which circulates at its bullion value
comes within the definition Of sound
money, the proposal to Mexicanize our
currency is the most unsound PROPOSE.
ton imaginable. because the end Is
worthless, and the means most destruc-
tive irrespective Of the fact that with
the silver dollar circulating at Its bull
lion value gold would disappear from
monetary use and the result would be
tremendous contraction The dollar
which is wholly or in part fiat" Is
unsound. but the Cheap" dollar Is
even worse, for q radical reduction in
the value Of the measure Of value would
make every man afraid to buy or sell
or lend.
It is the deepening and widening
realization Of these facts which is bring
ing business men Of all parts Of the
country together In opposition to I'M.
sound money, whose value depends up
ON an ephemeral majority in congress