Santa Fe new Mexican. [volume] (Santa Fe, N.M.) 1898-1951, 1912-09-26
HIGH COST OF
LIVING IS
Up
INTERNATIONAL CONGRESS OF the
CHAMBERS OF COMMERCE LISTEN
TO INTERESTING DISCUSSION BY
YALE TEACHER.
FISCHER PRESENTS
SOME new IDEAS

- - - - - - - - - - - ~
\ Postal reforms, an internation-
y al conference on the cost of liv-
\ ing and uniformity of action in
y the matter of consular invoices
= were the topics listed for dis
y cussion by delegates to the inter-
\ national Congress of Chambers
= of Commerce today The subject
y was presented to the congress
y in a report by Alfred Georg,
y vice president of the Chamber of :
= Commerce of Geneva, Switzer- )
y land.
* x $ % = = = X = x < s ;
Boston, Sept ga plan to stabi
lie the purchasing power of money
as a remedy for the increasing cost
of living was laid before the interna
tional congress OF chambers OF com
merce today by Prof Irving Fisher
of Yale University. His suggestion
was made in anticipation OF the in
ternatiOnal conference on the cost OF
living recommended by President
Taft.
my plan," said Prof. Fisher, lis
similar to a suggestion of Governor
Woodrow Wilson that the weight of
the gold dollar should be increased
enough to restore some of it's lost
purchasing power.
Il have said that my proposal is
virtually to increase the weight of
the gold dollar. But this increasing
weight would not be added to the
coins themselves, but only to the bul.
lion out of which they are made. In
other words, the proposal is to restore
on gold coinage. At present there is
no seigniorage. Coinage is free and
the weight of a gold dollar is as
great as the weight of the bullion
which the miner takes to the mint
and for which he receives back dol
lar He now takes 25.8 grains of gold
bullion to the mint to secure a 25S
grain gold dollar. The coined dollaE
weighs the same as the uncoined or
bullion dollar if l may use such A
term. My proposal is to increase the
weight of the bullion dollar; that is,
to require 26 or q or % grains Of
gold bullion to be taken to the mint
to secure 25.8 grain gold dollar. The
coined dollar would remain unchang-
ed in weight (25.8 grains), but the
bullion required to secure the coined
dollar--the bullion dollar-would be
heavier. The difference in weight be-
tween the two would be the seig-
niorage. 1t would not be fixed once
for all but would be continually ad-
justed SO as to give the dollar al
ways fixed purchasing power. AS
the coined dollar would be intercon-
vertible with the bullion dollar, the
two would always be equal in value.
The ultimate dollar would be as it
now is-a dollar of gold bullion-but
this dollar would no longer be of fix
ed weight and variable value, but of
fixed value and variable weight.
"The adjustment of the seignlor-
age would be entirely automatic, de-
pendent on an Official index number
of the price level. The system here
is, SO far as l know, the
only one proposed which is purely
self acting. If the official index num-
ber shows rise of prices in any
year, say one per cent, it would be
for the mints to add one
per cent to the seigniorage. Express
ed the other way about, if gold loses
one per cent of it's value, the mints
would pay one per cent less for it.
This would tend always to preserve
4 uniform purchasing power of the
unit. AS soon as any depre-
citation occurred the increase of the !
seigniorage would operate to correct /
It. The present mint price is fixed;
It is Sc, It's, 10 1-2d per ounce of
gold 11-12 fine in England or $18.6D !
per ounce of gold $40 fine in the |
United States. The proposal is sim |
ply that instead of always paying the
same money price for gold, no mat
.er how much it appreciates or de-
)reciates in purchasing power over
goods, we shall pay exactly what it is
worth. There is no virtue in a fixed
mint price for gold, but there is vir-
ue in fixed purchasing power of
money.
"The great fall of prices ending in
1896 was often referred to as an ap-
,reciation of gold, just as the rise
# prices since 1896 is often referred
o as a depreciation of gold. In other
words, the dollar, the pound sterling,
he franc, the mark and all other
units in gold were increas-
ng in purchasing power before 1896
md since 1896 have been decreasing.
n both cases the purchasing power
,aried.
This continual variation in the real
'alue of the dollar is the bane of
BUSINESS. 1t is one of the sources
O booms, crises, contractions and de-
'ressions by which modern business
nen are perpetually vexed. Unfortu-
lately, as yet, the rank and file of
BUSINESS men do not realize the close
connection between the cycles of