The Black Hills union. [volume] (Rapid City, Pennington County, Dakota [S.D.]) 1889-1904, 1899-03-17
GENERALPRICELE
THE QUANTlTATlVE THEORY OF
MONEY DEMONSTRATED,
h Contraction OF the Money Volume
by the Suppression OF Silver Coinage
Was One Great Cause OF tho Fall
Of Prices.

w ~
reject the cumulative theory Of money
and the general price level.
We accept it as we define and un-
derstand it, as absolutely automatic
and decisive of the question before us.
1t is unfortunate that our opponents
do not agree among themselves as 20
whether they accept Or reject it, OF
whether they accept it in part or i'll
any sense, or reject it altogether.
We undertake to say that no one
even did reject it who ever really com
prehend its meaning and import as
we define it. 1t relates solely to the
general price level Of all property and
not to the price Of particular articles
and their oscillations Of price under
the influence of the special supply and
demand for those particular articles.
An illustration here may illustrate:
If one-half Of all the waters Of the
seas should be absorbed into the rocks,
as we are told it may one day be, no
n can doubt that the general sea
level would fall. inevitably fall, how
ever small oscillating waves might APP
pear on its surface then. And if some
Noah's flood were to double, the guam
tity of the waters of the sea, car any
Il doubt that the general sea level
would rise-inevitably rise-howevCr
some oscillating ave might appear
fluctuating above and below the new
general sea level?
This might be called the quantita-
tive theory of sea water and Of the
general sea level.
The quantitative theory Of money
and the general price level is as SIM
pie as this when it is rightly under
stood.
How, then, do we define and under
stand 1t?
In this way: The general price
level of property, bought and sold.
varies with the whole quantity of
money and its accepted substitutes
that is in unhindered circulation IN
the commercial world, other things re-
manning equal. The general price
level rises with more money and fails
with less money. This Includes all
legal tender money and all its accept
cd substitutes that perform the func-
tons Of money in buying ana selling
property"
We hold, with General Walker, chat
that is money that docs moneys
work i'll trade l add in "unhindcr-
cd circulation for money boarded.
whether in val chests. treasury re-
serves, or otherwise, is as inert as
gold is before it is mined. It is him
deTel in its circulation.
"iindered circulation" is one of the
greatest of all the causes Of money
reduction and the fall of prices.
The contraction of the money VOL
ume, by the suppression of silver COIN
age by many great nations simultane-
ously was one great cause Of the fal!
Of prices.
The shrinlage Of the money volume
and the fall of general nricas hoo,,
II has continued since, not because
that shrinkage was at first great bnt
because it was certain to come and
was sure to increase with ADVANCING
time, till gold and its substitute.
should be the only money, and tho
world should have ceased to grow and
begun to decay.
Discerning business men then real
lzlng the coming fall in prices with
drew from business when they could.
and locked up their money. Thov
declined to put money into new on
terprlses not protected by legal ~.
other monopoly.
Inc very tramp ceased to put into
circulation monc% he did not earn and
couldn't get. He periodically with
from the mad scramble to ho,m,,
money, and from adding to the mis-.
cries of over-production.
But the great nations aptjcin,t;ro
sudden and destructive wars o,,,rao5
themselves, by locking IN l,rso
amounts Of gold in great war chost~
and national reserves.
NOW it is also from the aggregate re
al these forms of boarded mono,
the volume Of money in nsa h.,
and has in part caused ~,
great fall in prices during the ,,.t
twenty-five years-caused it altogathor
far as 1t has been caused by sca roo
S'"''E
l agree that abundance causoo -.
new machinery and cheap transnorta-
tlon, etc., may cause a fall in ,rico,
is benelicent. But the fail If
prices due to money made scarce Nv
governmental action, is a WHOLLY dr.
[erent thing and is not beneGcent hut
IS destructive Of the interests cf tbo
people, is in violation of sound no,iti-
economy as we'll as of the moral
I2IIl yt-s thu