The sun. [volume] (New York [N.Y.]) 1833-1916, 1916-04-17
"DOLLAR SILVER"
Is This Price Possible without Any
Implication Of Reputation?

To THE EpfToR OF THE SuN-Sr: The
letter Of your correspondent "Old Wall
Street in THE T. OF April 10. allud-
ing to the possibility of dollar an ounce
silver" is, it is to be feared, ironically
sceptical. Based on the idea that Eu-
rope will remonetize silver with a view
10 scaling down an overwhelming debt.
that writer may be wrong In his prem
ises but right in his conclusions as to
the future Of the silver market.
There are many factors working to
improve the prospect. But the current
price. 3oHsd. a Rne ounce In London.
is o extraordinary. 1t contrasts with
about % Nd. at this time "A year ago.
but the market then was not yet free
OF the Generalization that followed the
outbreak Of war. A fairer comparison
would be with the 26isd. price on July
I, 1914. the New York quotation Is
now about say cents. against SO cents
last year and 66% on July 1, 1914. The
average in 1913 was ION. In 1912 6lh
cents. TIL years average had not
previously been above SO cents since
the year 1907.
In August. 1914. In calling attention
IN THE SuN TO the effect Of the great
European war OH silver as likely to en-
nance Its value. ] maintained this view
on grounds that did not include SO radi-
cal a movement as the reconciliation
OF tho metal. although such an outcome
might well follow the tremendous ex-
periments and unprecedented economic
developments accompanying the war.
aggravated by the almost unthlnkable
financial burdens assumed by the bellig-
erents. The longer the struggle lasts.
moreover. the more likely is Ii that the
commercial status OF silver may 50 Inn
prove that the metal will be welcomed
to its old time monetary position. In
thA & ENA VA.A. Aa1 ..
often been fecund with sensational
change. Less han half a century ago
bar silver In London was worth the
equivalent Of sl.32 An ounce in gold and
the commercial ratio to gold was l5i2
TO /. 4 quarter os a century ago the
white metal. though demonetlzed, aver
aged over 81 an ounce the commercial
ratio wac about 20 TO /.
1t Is quite conceivable that the Ger
man Government. In case OF defeat.
should succumb to the weight OF It's
irredeemable currencies and be unable
to restore the gold standard. isussia's
enormous note issues may prove be-
yond her power Of redemption in gold {;
Italy may be unable to resume specie
pay ments. France, bimetalllc now as IN
the past. proved her wonderful iuan-
cial resillency when she met the dag
ger thrust at her after the military hui
initiation Of forty-tlve years ago, and
in 4 few years repleuisheG ,he gold
that Bismarck had meiciiessly drawn
from her monetary veins. She may be
expected - reestablish her credit In a
comparatively short time ny building
up greater gold reserves than ever.
Great Britain has already made too
severe sacrifices In maintaining the in
tegrity Of the pound sterling in war to
abandon the gold standard in peace. But
even she might conceivably Join other
great Powers In utilizing silver, II only
as a crutch with which to help the Old
World hobblc back TO solvency and
rehabilitation.
But neither complete nor partial re-
pudiation is a requisite for improving
the commercial status of silver and
bringing it INTO larger pay in inter-
national currenc!es. Never In history
nave the treasures and bank vaults of
the nations been piled so high with
gold as they are to-day. Cold. by its
concentration In visible supply and con-
tro!. Is better prepared. We're times nor
NAL. than ever before 10 fu.iil the fuuc-
ton Of a redemption and credit reserve
10 which II mas been assigned by mod
ern banking and currency theory AS It's
most utlltdI'an mission. And this con-
centrltiun has been effected by transfer
rom private boards and pocket circula-
tou To sucu an extent as 10 Great" an
immense vacuum which silver can best
til. In July, 1914. the principal CEN
trail banks Of Europe held IN round fig
ures 81, 200, coo, UOn gold their present
holdings exceed $4,000. Goa 600, an in
crease ~ less than two years Of over
81 LOO. zoe. 1000. Another $500. 900. 600
may Ice added to represent the Increase
IN the gold holdings OF the smaller
countries Furthermore. Europe cot
cours" counting tandda's contributions
as part of the Bank Of Euglaud'-l sup
piled practically al Of IN, gold which
the United states took IN nv iinpoc, In
l9li-l5. GUY net influx having been
about $2j5,ooo, ouo. From whence did
Europe get This total required amount
Of sl,5.o,ooo, 600 =o,d' Here We're her
current resources
WorlIe oU'1Ut !a't' q.
0st'rr wear estimated So ~ 80
Deduct l. : output
kept a, home. 'sii'5. .slt5 tHo. -.
J Worlis industrial con
sumption, 1871 l5......'i ft -" 81. N. 40
MAXIMUM balance avail
able. two years sGN go az
'i'rcvIou- annual average he fore tho VA
exceeded 500 - TO- On