The Dalles times-mountaineer. [volume] (The Dalles, Or.) 1882-1904, 1896-09-19
FREE COINAGE.
How Gold Will Fall in Value Under Free
Coinage.
[silver's Letter No. 4.

[Silver's Letter No. 1.
:. l. has been asked of me by some
my gold standard friends, how it
"A figured that the purchasing value
gold will fall on account of the fire
coinage of silver? In answer | woul
le say that it is very simple. and depend
II as [ have already explained in m
n previous letters, upon the law of suppl
" and demand.
The United States-as appears b
q statistics-now holds one-seventh {
}. the gold money in the world-an
y since gold, like everything else, flow
}. from place to place in accordance wit
the demand-we may safely assum
+. that the United States furnishes one
Il seventh of the demand for gold all owe
;. the face of the globe. Besides this
Q the United States, under our presen
system, is constantly struggling for ;
, still larger proportion of the gold o
the world-selling bonds, etc, tt
, obtain it-and thereby constantly in
creasing the demand therefor IN the
worlds markets.
Now the gold standard people claim
that the adoption OF free silver in the
United States would drive all this one.
seventh of the gold in the world out of
circulation in this cOuntry-in other
words, that we would go TO q silver
basis, and as we could not profitably
|
while we were on the silver basis, it
would be thrown back upon other
countries where the use and the de-
mand for it would be greater. Now if
this is true, the effect of the free coin
age of silver would be to entirely des-
troy the one-seventh of the worlds de-
mand for gold, which is now repre-
sented by the United States. Is it not
| absolutely plain, then, that if you can
| destroy one-seventh of the demand for
| gold by the free coinage of silver, that
the purchasing price of gold is bound
| to drop?
To illustrate: Suppose that tomorrow
something should happen to destroy
one-seventh of the demand for wheat
in the markets of the world, the supply
of wheat remaining the same. What
would be the effect? Anybody knows,
who knows anything about the history
of wheat, that the price would fall one
half; since, so nicely is the demand
and supply of wheat balanced in the
world, that a falling off, or an increase
of five per cent in the worlds supply
always represents tremendous rise or
fall in the market.
Thus it is seen that by natural laws,
as sure and certain in their operation
as the law by which water seeks its
level, the purchasing value OF gold
would be tremendously diminished, if
the seventy million of people in the
United States should entirely cease
using it as circulating medium.
But it may be urged that silver ad-
vocates do not believe that the free |!
coinage of silver would result in en-
tirely driving gold out of circulation
in the United States, and therefore,
the effect upon the demand for gold
would not be so great.
Very true, silver people do not think
that gold would be driven out of cir
culation here, but what they do believe,
is that the scramble for foreign gold
on the part of the United States would
at once cease Our demand for the
gold which we now have would, to
certain extent continue, although
modified by the extended use of silver,
but there would be no more selling of
bonds to get foreign gold, no more
on the part of the United
States in the contest for gold in the
of the world, and besides this
the action of the United States would
mark the turn of the tide. Financiers
Of all nations would at once see that
gold was not going to become an uni
versal standard, as many of them have
lately supposed, that the demand for q
medium was turning back
towards silver.
There would be strong probability
Of other nations following in the
footsteps of the United States, and
giving up their demand for gold. The
result would be that bankers and
money chargers all over the world
would cease their scramble for gold,
since it would be the falling metal,
which had reached it's high tide in
value, and they would commence a
scramble for silver, which would be
again the rising sun of financial circu-
ation. The inevitable result would
be that silver would go up and gold
would come down, and, as we baye
said, since this would depend, not upon
theory. but upon obvious natural laws, ;
,he result would be as certain to follow
IS it Is certain that the sun will rise
tomorrow, or that the tides of the
ocean will continue to eb5 and flow
TO the attraction of the
noon. SILVER.