Evening star. [volume] (Washington, D.C.) 1854-1972, 1904-06-25
THE GOLD STANDARD.
Large Value and Small Bulk Fit It
for Great Transactions.

| Chus. A. Conant In Trust Companies.
1t has been by no arbitrary action OF gov
| ernments or individuals that gold has grad
| uaIly been formally recognized the
| standard. first of Great Britain and then Of
| the nations Of the continent of Europe and
| Of the United States. 1t Is especially fitted
| for large transactions because of its great
| value in small bulk. This made 1t the
money of international commerce even
| while silver largely used in domestic
transactions. Inevitably. commerce has
tended to select the medium of exchange
an article having the greatest value in
the smallest bulk which was universally
sought. easily Invisible without loss. and
otherwise suited to the purposes OF money.
So strong IS this tendency to select the
most convenient instrument for making ex-
changes that even paper Supersedes gold
where II Is equal to gold In value where
by law 1t Is legal tender for the amount
of gold expressed on its face. The notes
of the Bank Of England are universally ac-
ceptabe the continent OF Europe. be-
cause they afford one OF the easiest means
of making remittances to London. Ameri-
can legal tender paper and bank notes were
accepted in much the same way In the
orient after the American occupation OF the
Philippines. because they offered more
portable and convenient method of remit
| lance to New York than gold coin or bull
lion. Paper almost universally drives gold
out of circulation for the denominations
for which it is issued. that for a nation
which sanctions such paper issues the only
means of retaining an adequate stock or
gold Is to require legal reserves In definite
proportions against note issues and bank
deposits.
An important factor in promoting the
adoption of the gold standard was the great
increase in the production OF both OF the
precious metals In the nineteenth century.
The Increase In the worlds supply of gold
made it practicable for one nation after
another to find in the market. and to ac-
quire without too great an economic sacri-
Ace a stock of gold adequate for the bass
of its monetary system. The increase in
the volume of metallic money, moreover.
along with other economic changes. tended
to change the relation of money to goods
in a way to make both of the precious
metals less valuable than before, and to
bring the smaller gold pieces more nearly
within the range Of retail transactions.
This point Is well set forth by the Vicomts
d'Avenel:
THE fall alone In the purchasing power
of the precious metals has rendered silver
inconvenient and i'll adapted to a multitude
OF for which it formerly sufficed The
same object which one might have obtained
In 400 or In 1890 for 900 grams of silver
would require today 5000 or 600. One
could carry a kilogram in his pocket. or
five or six Kilograms in his valise, but ne
revolts at carrying five or six in his pocket
and twenty-five thirty In his valise-
The opening of the mines OF California
and Australia about 1880 SO increased the
stock of gold within a generation as to
make ii adequate to the needs or money
In the principal commercial nations OF the
time The subsequent discoveries in South
Africa about 1883. and in the klondike at
an even later date. tended to maintain the
supply and to afford an increment of in
crease which permitted countries less strong
in economic resources, like Austria. Rus
STA and Japan to follow successfully in
the wake If the other goid-using countries.