New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-28

/ the amount OF goods than as III IL
could run only twenty miles. Every
thing depends upon the speed, or as
the professors say, the velocity.
/ Velocity the
/ Important Factor
Now it is exactly the same way
with money. Just as all these goods
and commodities have to be moved
about from one place to another so
that they may reach the consumer,
so every one who is engaged in SELL
ing has to be paid, and money is the
device by which this exchange of
goods is effected. And it takes a
certain quantity of money to do this
work. But just exactly as in case
Ct the railroad train, the amount Of
money that will be required will de-
pend entirely upon the speed with
which it passes from hand to hand
If, for example, all the money in the
country is on the average passed
from one hand to another forty times
i year, it will take only half as much
money, or currency, to effect all these
exchanges of goods as if it changed
hands only twenty times.
All this is so clear that the Won
DER is that no one should have
thought how all this may affect the
general run of prices. Almost every
writer on political economy, from the
time that political economy came 10
be something of science, has rec
ognized what a powerful influence
the quantity of money must have
upon prices. Money is commodity
in its way, just like wheat or coal or
calico. That is to say, it can be eX-
changed for these things, and the
ratio of the exchange is what we call
the price of things.
Now, it is obvious that if there is
great deal more money than is
needed to do the business of a coun-
try at any given time, money VIII
be cheap, and the effect of this is to
make prices rise. If business is very
heavy and the supply Of money Is
short, then prices will fall. All this
has been set out by John Stuart
Mill and other economists before him
clearly enough nearly a century ago.
An Economic
Puzzle
But the curious thing about the
matter was that at times the theory
did not seem TO work. There seemed
to be periods when the amount of
money was increasing rapidly and
yet when prices were falling, and
vice versa. 1t was very puzzling and
there finally arose more than one
writer on economics to doubt the the
DRY altogether. And then came the
famous Bryan campaign of '96.
AS most every one knows, prices
during the Civil War rose to a great
height and every one felt flush. Then
came the inevitable setback from the
wild initiation which had taken place.
The panic Of 1873 followed And
from that time down TO about 1893
the general level of prices kept fall
ing steadily. This lasted for a full
twenty-five years. Then in most
mysterious way this movement of
prices was exactly reversed. They
began to rise. But by go they had
not risen enough to have any great
effect. And meantime millions of
people felt poor and sore. Farmers
who had to sell their corn for Is or
20 cents bushel, and sometimes had
to burn it as fuel, because there was
not market for 1t at all, somehow
felt that there was something wrong
in the scheme of things and that, TO
put it bluntly, they were simply being
robbed"
This feeling was widespread all
over the country and Mr.. Bryan took
every advantage of it he could. And
his attack was very ingenious. For
long time silver had been the prin-
cipal form of money in the country.
But about 1878 it became so plentiful
hat the other nations took to using
gold instead, with the result that
there was a perfect glut of silver.
And so, as a matter of simple self
protection, silver was discontinued
as final standard Of value. The
fall in prices followed this. II was
very easy TO think that there was a
direct connection between the two
and the result was Mr.. Bryan's cele-
brated campaign for the restoration
Of silver.
In this campaign Mr.. Bryan ex.
pounded the classical thAav Of