Tonopah bonanza. [volume] (Butler City [i.e. Butler], Nev.) 1901-1909, 1907-03-23
HOW METAL PRICES.
ARE Determined.
ENGINEERING AND MINING gOUR-
NAL EXPLAINS A MATTER
LITTLE UNDERSTOOD

We have reeeiTed inquiries a. 70
the uanner IN Ehteh the important
met2Is other than iron and steel are
sold says the Engineering q Min
Ing Journal We have many times
printed artielea o. these subjects
bit a. new mrsoas are constantly
coming into the baslnes rho are M
familiar with IL there II ample rea
aou for republishing information that
II pem knonn to he majority. Cold
10. a. j. weH kn0an. the standard u
value. IL prize being fixed al the
British mint At 77s I9.5d per ounce
troy o. 9-sz5 aneneas. and A. the
United States mint Il sze.gTIs per
trOE. These mints receive an
limited quantities a. tn0ss yrice1
However. there Is nothing 70 prohibit
2 private banker from bidding high
er Il be chooses Of course. 10 one
viii pas much sBoye The coinage
rate, because gold can be obtained
always from the minis on the basis
Of IT'S 19.5d and s29.g7ls per
D respectively. but gold coin
loses something 81 abrasion and Is
subject to further loss En shipment.
wherefore. there - a margin for bid
ding on gold bullion. IN December.
1903. the price for gold bullion zas
7ss 0.5d. the highest Of recent years
Shipments Of bullion 70 London By
the gold mining companies are re-
eeived b. their banks
On the day Of arrival bids are
asked from the Bank u England and
from foreign banks which may want
the gold for export. The highest bid
der gets II. The market for gold Is
Intimately associated with the bank
Ing transactions whereby in~ternation-
al balances are settled. Id the pur-
chase u ores, and ror all ordinary
purposes. gold has ou.Y the fixed
coinage value. The silver market IS
also intimately connected Eith bank
ing transactions. large exports being
made from London to the far East
IN settlement Of balances The sill
yer market Of the world. more than
any other metal market. is deter
mined BY London. The silver brOk-
erg Of London meet daily at 2 b. m.
and FIX a price for that day. They
are bound to sell al the price thus
fixed any quantity that may be re-
quired. but are not bound to axe any
quantity that mas be offered II
the quantity offered Is more than
can be disposed Of, It necessarily goes
over to the day following. and then
has an effect in fixing the price for
that day. The London quotation is
for standard silver. that is. O.925
fine.
The New York price for silver huc-
tuates generally in correspondence
with the London price. being lower
than the London price By an amount
representing commissions. express
age insurance. interest and other
charges between the two markets.
and also Is affected BY fluctuations in
the rate of exchange Occasionally
the New York price f~oreshadows the
London price for the following day,
wherefore the difference between the
two markets Is not absolutely con-
slant. The New York price is estab-
lished by the firm Of Handy & Har-
man. which handles the great bulk
OF the silver bullion business Of the
United States. most Of the large re-
fners selling their roduct through II.
Silver Is commonly sold in ingots a
little upward Of loo ounces In
weight. 1888 fine. for cash. immedi-
ate delivery The quotation above
referred 70 IS frequently called the
official price. and is commonly
adopted in business and ~ the press,
and Is the quotation which IS pub
llshed IN the Journal
Occasionally there are quotations
for commercial bars which are a
little higher than the Official price. y
These represent the retail business
that is done with jewelers.. manufac-
turers OF s%ilverware. etc. a business
into which the large reiners do not
enter. The large transactions in
silver are rather complicated, and as
above stated are closely involved with
banking. This Is illustrated by the
transactions of the United States
mint in 1906. when II purchased g..
15S.725 ounces Of silver. Before in
viting tenders publicly, last August
the treasury department, anticipating
that such invitation might have an
effect upo the market, bought about
$500, 600 ounces on the London mar
ket for future delivery. These pur-
cbasps were afterWard exchanged for