The Stark County Democrat. [volume] (Canton, Ohio) 1833-1912, 1902-12-12
WILL ADOPT
COLD BASIS
Mexico Enters Deal for Fifty Millions
for Redemption Pm-
poses.
PRODUCES TOO much silver

Washington, Dec. 11.-Mexico is 60
ing to adopt gold basis. Mr.. Aspi.
roz, the Mexican ambassador said
yesterday morning that such was the
plan and determination of President
Diaz and that it would be carried out
as rapidly as the economic conditions
of the country would permit II Is
reported that Mr.. Limantour, the min
lister of finance, has entered into ne
gotiations with syndicate of New
York bankers to supply the govern
ment with s50,O0O00O Of gold for re-
demption purposes, but Mr.. Aspiroz
knows nothing about that. He has
heard the story, but his government
has not advised him as to It's plans
if it has any in that direction.
THE only actual step that has been
taken thus far toward gold basis, y
said he, is the enactment of a law
by the congress of Mexico, which is
already in force, requiring the pay
ment of customs duties in gold or the
equivalent; upon theoretical exchange
at 120 per cent premium. Therefore
as the price of silver goes down the
customs duties are increased to i
corresponding amount when paid in
silver, which is the currency of the
country.
AS an illustration" continued the
ambassador. "the rate Of exchange be-
ing about 10 at present, the import
ing merchants have their choice be-
tween paying their duties in gold at
800 or in silver at 1910. AS the ex-
change is calculated at 120 the actual
difference is $50 in silver.
"The great difficulty in my country
is that we produce so much silver
and so little gold, but the production
of gold is rapidly increasing, partic-
ularly in the northwestern part Of
the republic"
In 1898 India was in situation
| similar to that of Mexico today. He
roic measures were adopted. The
Inints were closed, and the govern.
ment undertook to maintain the
value of the silver rupee, the COM
mon currency. by accumulating a
gold reserve. The value of the rupee
was fixed at 16 pence, and although
| it is worth only s pence as bullion,
that value has been maintained
throughout all the years The silver
coinage is merely a form of currency
without regard to it's intrinsic value,
| like the national bank bills or the
greenbacks of the United States. No
account is taken of the fluctuations
! of silver any more than of changes in
the market price of the paper upon
which government notes are printed.
Lut all silver rupees in India, like AL
paper currency in the United States,
are redeemable in gold. When a
banker imports gold into India he
| deposits it in the government treas
ury, and receives in exchange silver
rupees at the rate of 16 pence to the
rupee. When a banker needs gold he
! buys it at the same rate. The eX-
penses of the mints of India are pal |
| by the seignorage, that is. the differ
ence between s pence to the rupee,
which the silver costs in bullion, AMI
l6 pence, it's current value.
Great Britain is making arrange
ments to place the Straits settlements
on the gold basis in similar man
ner. The government of the United
States will have to do the same in the
! Philippines. The subject is already
under consideration in congress. A
bill will be reported shortly for that
purpose. China also is giving serious
consideration to the matter, for it will
soon remain the only country with a
silver basis.