New-York tribune., 1918-10-20
The Gold Situation

1 ne AOlQ OlluduOn
7 O the Financial Editor of the Tribune.
Sir: | have read with much in
;erest the paragraph in which you
speak Of our recent publication on "The
Gold Situation" However. / am under
the impression that careful perusal
Of our booklet would have elucidatet d
several points which seem TO have
escaped your attention
May | attract your attention TO the
fact that Just because ! realize the
disturbance which might be caused by
& revaluation OF gold express the
opinion on page 81 that "Jevons pro-
ject would necessitate complete re-
vplsion of the present economic
structure. which may prove dangerous
at time when so many economic
problems besot the world"? In regard
to the effects that more gold would
havc on the currency circulation,
advocate on the same page that "the
bounty paid for new gold should not
he considered az an increased value of
gold, and, therefore, offer a basis for
new issues Of currency, but it should
be regarded a. a government expense.
similar to other war expenses at pres
ent figuring in the budgets
quite agree with you sterl. copper,
lead and zinc are needed But surely
you viii admit that gold is a necessity
at this time Secretary McAdoo and
the War Industries Board have ruled
that next to food and ammunition gold
is one of this most needed war essen
tials. The claim that gold is not needed
when the whole credit aud monetary
system OF the world aro still based on
sold Is, to say the east. a very daring
assertion
fail TO zee how advancing the price
OF gold or putting bonus on produr-
aon. provided such increase is NOT
made the basis Of IN increase in cir
culation. would increase the cost ~
living. As set forth on pages IA and
10 OF "Thc Gold Situation" value
usually called price" when expressed
N terms Of monetary unity is M
'nu1nslc quality of thing; it is an
e%trlnslr arcident. and TO provide
common denominator for the nnrpnsr
OF esta ablishing the relative value ~
comm oditles, service. labor ctr
among each other And gold. which
IS primarily commodity, is the basis
q money Its value. It's intrinsic rr-
laflon 70 all other commodities hs.
o1'en arbitrarily fixed. The rooi OF tho
oVu Is THAI the average person iaen-
'1les completely money with gold al
though many another commodity h.s
heen used al one time or ano+ber &c
money.
indeed. when the true relation Of
gold TO other commodities and noncv
l. clearly understood, it becomes d;f-
neu'f to realize how certain amount
OF wool, coal. steel or gold could havr
oeen exchanged for, let US say. TWENTY
units of a certain common denor,;
MAJOR OF value in 1914, and now al
though twenty units Of IN. s.,n
Ihoh denonlnator can only procure tyv,-
'h'rus or the amount Of wool. coal ot
steel It can still procure The vuxr
same amount OF gold az i. did in ,o1t
As 10 an exact appreciatio, rs
Professor Irving Fishers real opinion
81,
on the subject Of gold as standard
o. value, i glance at his rccor+
pamphlet would show that tho n,o@oe
for advocates even my. ra;
change Of the standard of value +bar
inc one mentioned by myself In fact
: careful study Of the professors ad
fahced theorles can be recommended
as very edifying exposition Of .1,o
fea relation of gold to other com.
lnodlties and money.
The statistics given in o,,r ,or
Phie' tend to prove that. while ". have
ny far the greatest amour, of +ho
''meNtal metal, the world at large has
surely not IAN undue quantity Of 90, d."
10 be exact. the proportion Of gold in
the world TO credit and currencv-if
gold Is to remain the basis OF credit
'nd currency X coming alarmingly
near the danger point IL should be
well to remember that a question of
such magnitude must be considered
an IS broadest aspect; it is an inter
NJ .lcnai question.
In the last analysis the future
economic welfare OF our own country
IS bound TO the economic welfare Of ,be
world IN general. Therefore. the crea-
uon of American. British and French
commiss.ons advocated in the nam.
phlet Is TO my mind most urgent
necessity. HENRY Z. COOPER.
Vice Pres ident.
tquitable Trust Company of New York.
New York. Oct. Il, 1918.