The Anaconda standard. [volume] (Anaconda, Mont.) 1889-1970, 1899-12-24

hlLb the bcstoi aiu 49, 80
w general, a very able newspa-
per. it's knowledge of none
tary principles Is by no means on par
with its understanding of other pubhc
questions. A paper that will seri-
ously argue that the quantity OF
of money makes no difference and that
its quality Is the all-essential thing,
certainly has not advanced very far
into the intricacies of that branch Of
political economy.
Neither a newspaper nor an individu-
al that really believes the quantity OF
money to be immaterial, is properly
eouipped for dealing with the great
monetary problem, which for the last
quarter of century has agitated po1h
Europe and America. The Standard mas
more than once intimated a doubt OF
the absolute good faith of those VINO
question the quantitative theory, the
doubt being based upon the obvious
| fact that every business man In the
world recognizes the principle when his
own private affairs are directly in
! volyed. What is more, those VINO
| argue the question from something OF
| an academic standpoint, also admit II
either directly or by necessary impllca-
| ton. when dealing with matters that are
| collateral and incidental to the main
| issue.
In recent comment upon the cur
| rency bill passed by the house the Her
| aid itself virtually admits the quanta-
| tive theory at the same time giving
| some evidence of a more accurate
| knowledge of monetary science than Its
! denial of that theory would Indicate
It perceives defects in the bill which it
| hopes the senate will remedy, but fears
| that it will not through the Ignorance
of sound financial principles on the
part of many senators. The Herald
says: "They will not recognize that
| the provisions of the bill for the in
crease of bank circulation unlocks the
| door for a large imitation of paper
money, and that every dollar thus
added to the volume Of domestic money
| will inevitably diminish to an equal ex-
tent the amount of gold money in the
| country"
| That Is eminently sound, and 1t
rests upon the fundamental prin-
| ciple that no country can per-
manently hold any more than its
distributive share of the worlds total
stock of money. This principle is
| recognized by all economists of repute.
| But why is it, and how does the prin-
ciple work? Just In this way: II a
country gets more than it's proportion
| of money, prices in that country will
rise above the international level, and
money will flow out to make purchases
in countries where prices are lower.
and this will continue until the equil-
| ibrium is restored. This holds good
| universally between countries closely
connected commercially. and having
| the same classes of goods for sale At
! the same time the country with less
than its share of money, while increas-
ing it's sales, win diminish it's pur-
chases in countries having an excess,
| and this also operates to restore the
proportions.
These are perfect exemplifications of
the cumulative theory, which is simp-
ly that prices II any country are con-
troIled by the quantity OF money In
such country In proportion to the
| things to be exchanged for money.
Now, to go a step further. The Her
aid sees danger IN the fact that the en-
| arged issues Of bank notes will drive
gold out of the country. But why dan