The Washington times., 1901-08-03
brazilian Money.

A late news item relative to Brazilian
money has a curious and instructive
bearing upon the great bimetallic con-
| troversy which began shortly after 1873
and continued until quite recently. The
item is, in substance, that year ago
dollar in American money was worth
about eight Brazilian milreis, while now,
owing to the appreciation of the Bra
lillian currency, the dollar is only equal
to three and half milreis. The Amer
lean missionaries it is said, are paid
in American money. This will now
exchange for less than half as many
milreis as it did year ago, while the
mi!reis will buy no more in Brazil than
they would when ii required eight of
them to equal the dollar. Hence, the
rise in the value of the milreis has
been a direct injury to the missionaries.
This brings up the foreign exchange
feature of the bimetallic question. The
two leading contentious of the bimetal-
lis.s, both in Europe and America,
wee, first. the quantitative proposition.
that the decentralization of silver had
reduced the quantity of money COM
pared with other things, thus lowering
prices and creating business depression,
and second, that silver standard coun-
tries were given the advantage in in
ternational trade. The latter is the one
upon which the British bimetallists laid
the chief stress. The argument was
briefly this: When silver was excluded
from the mints of Europe and America
the value of silver bullion was depre-
ciated compared with gold, by being
deprived of its principal use. AS the
gold value of silver bullion fell. the
gold value of the coins of the silver
standard countries which had open
nints fell in about the same ratio.
Therefore, gold coin stood for more
silver ones than formerly. But it was
also claimed and shown that the silver
coins, although worth less in gold, !
would still, upon an average, buy as
much as ever of the products Of the |
country in which they were used. The |
effect was to stimulate the export trade |
of the silver using countries, and at the |
same time check imports into them. |
For example, the East Indian could |
sell his products in England for gold. |
with this gold he could buy more sill |
yer than he could before, and when the |
silver was coined into rupees, he had |
more of those coins. which in India |
were just as good as they ever had |
been. For the same reason the silver |
countries were discouraged from buy |
ing in gold countries, because they had |
to give up more silver in order to real |
ize a given amount of gold, and unless |
the goods fell pro rata, there was
loss on the transaction.
In support of this contention II was |
shown that India, Mexico, Japan (then |
using silver, and even China were
more than usually prosperous, while |
the gold standard countries were, for
them, in a state of great business dis |
tress. This whole matter was gone into
thoroughly by the British Gold and Sill
yer Commission of 1856, 1887 and 1883,
and its report showed that the claims
of the bimetallists were well-founded
The gold men insisted that it could not
be so, because even IL the producers
in silver standard countries did get |
more silver for their commodities, they
were nothing the gamer. the silver be-
ing worth less in gold IT seemed i'm
possible for a gold advocate to com
prehend that silver, say the rupee or
the Mexican dollar, could shrink in its
gold value, and still buy as much rice
or indigo or cotton or wheat in one of
those countries. And yet such was the
fact.
Now, when silver as a political issue
is nc longer before the country (thanks
TO a bountiful supply of gold and is
only being discussed accidentally, we
learn that the Brazilian milreis has
more than doubled in its gold value.
without increasing in its purchasing
power, just as the silver rupee former
ly fell in gold value. without losing
anything of it's purchasing power in
India. 1t matters not for the purpose
of this commentary what has caused
the rise In the gold value of the Bra
lillian money. The point intended to
be brought out is simply that change