davidaulloa/AmericanStories huggingface dataset:
New-York tribune., 1918-12-22
Agents de Change
In 2 Paris Have Partners

Inc Bourse proper in Paris consists
OF seventy members, known as agents
de change who have enjoyed special
privileges in connection with trading
IN securities since the fourteenth CEN
tury. At times the price of the privi-
lege OF BENG an agent de change has
gone as high as $400 600, but in 1914 it
was valued at about 100000. In addi-
ton, the agent de change must fnrnish
cash bond of $4,000.
"Although the majority of the mem
bers are we'll to do, they are not usual
~ able to provide the means for the
pohd and the purchase and the neces-
sary working capital. Generally. there
fore, they combine with other capital-
lists, who become silent partners of
the business and are termed partners
although assuming no rights or obliga
tlohs to third parties, but only to the
agent de change himself.
because of the large amount re-
CURED to be paid for seats on the
Bourse, most of the agents de change
are not called upon to both paw the
same ana furnish the necessary capital
Tor the business, but have partners.
The trading of the agents de chance
IS SO clrcumscribed by regulations hat
there is less interest in it in compari-
son with that Of other countries
:, Trading on parts of. the floor of
the Bourse rot allotted to the agents
de change, as well as on the porch
OF the building, are two associa-
llons of outside brokers, known as
Oouiisse One set trades entirely in
securities for cash or immediate set
tlement and the other for tern, sa4tle-
ments, which are fortnightlv for Frcrcr
rentess and monthly for other active
securities
New-York tribune., 1918-12-22

both In their capacity as loaners of
money and dealers in securities, were
members of the Bourse and members
OF the clearing house, as we'll
The so-called settlement department
Of the London Stock Exchange clears
Tor about 200 firms, representing ap-
proximately membership of 1000. and
IN far business markets about 800 to
1000 firms actually send in sheets, the
settlements of brokers' loans being
tortnightly. The routine of settlement
comprises four days, the first being
mining settlement day, the second for
bearer" stock and other securities;
the third day is the one on which tick
cts for clearing are passed, and the
fourth day is pay day, when the bal
ances OF securities are delivered and
paid for.
at is not customary" saws Mr..
Street, "in London for brokers to have
checks certified by the banks in pay
ment for securities, as here, and the
margin on loans required by the banks
for the fortnightly period averages
about 10 points, instead of the usual
20 per cent demanded here. AS regis
tered stocks can only be delivered by
transfer and the tying up of these for
large amounts when only part thereof
has been sold might cause burden,
there is connected with the Stock Ex-
change what is known as the share
and loan department, which receives
certificates from the seller for trans
ler that have been sold, and by certi-
tying to that effect on the transfer
deeds, enables a delivery to be made
Wnlle the stock is in process of trans
New-York tribune., 1918-12-22
Proposal to SsDo Something Cor Cold, if Adopted,
Cheap and Inevitably Result in Another Boost
Living, Thus Causing Widespread

fine, or CD that the government give
the producers of new gold bounty in
proportion to the amount Of gold pro-
duced. Milder forms Of government
assistance have also been suggested
either to be used alone or as supple
mcntary to stronger forms.
These p 'oposals are apparently find
ing favor IN high places. An American
gold conference was held at Reno, New.
the fore part Of Augus and similar
conferences have since been held at
Portland, Ore, and Spokane, Wash,
These conferences all favored govern
ment aid to gold mining.
A committee appointed by Secretary
Redhcld is now making a study of pos
slble methods Of stimulating gold pro-
duction. Secretary McAdoo recently
appointed a special committee "to study
carefully and thoroughly all the diff
culties confronting gold production"
and to submit sane and sound methods
of relief" "The Commercial and FL
nancial Chronicle" our best known
American financial weekly, in it's issue
of September % favored government
aid to gold mining. The American
Bankers Association in national con-
vention in Chicago the last week in
September passed resolution to ere
spectfully request and urge upon the
government of the United States the
desirability Of maintaining the produc
ton of gold to at least it's pre-war vol
ume and ask that steps be taken i'm
mediatcly to that end" .
In England also the subject of "do
ing something for gold' is being agi-
tated. The British Treasury has ap-
pointed a commission to investigate "the
wars effect on gold production n tae
british Empire" and the commissions
instructions call upon it, among otner
things, to suggest a plan designed to
show how the production Of gold can
be stimulated.
Proposals with support like the above
must be taken seriouSlN
New-York tribune., 1918-12-22

IL -
they are interchangeable witb.a.
pTec'aoie expense to the owna, raus a.
UNI OF yalue. the gold dollar Ig
grams OF gold 900 fine Wis., Is 8s
INTO American coin, and all of Of onlhta
1erent KINDS Of money are ,n.;f Caf ais.
at parity with this oolS lSs'htsslnea
Therefore anything that 49, aola
value OF gold affects the valno Ae
dollar. and no matter how nom.ti oi he
IS produced, o. how little. MA M soid
no~ large a proportion Of our matte,
are made by means Of ha, t@snehts
and bank notes, or how small ~ sneeks
OF 25.8 grains Of gold 900 sns e PRS
mint IS 81 and the price of a. tie
Of standard gold is 1880 o." ounce
Eut to say that the pries II
IN the United States does not ~ g'd
IS not to say that its value e"sige
change The market value es ~ not
Ike the market vaue Of anv o.Ss soid,
modify, IS expressed in its -s. cnr. con-
over goods, namely by what ;.'"aha !.
pflng IN the market in exchange sa ~
other goods. While the produss, ~ :.
gold unlike the producer Of anv nv. ~, o.
commodity in America can Dsas'
count upon fixed price f. @'"sys
product regardless of how MI aA
produces or how little. ba "'usn rs
count upon fxity in his exnensaa saaoe,
production. 'e"Sss oi
The more gold that is thrown =, :,
market re ative to the demand y We
less valuable gold becomes ~ sae
TN to other goods and tho =; ,s.s-
the price level for other ooo5s snet
An increasing supply Of gold 80 ,'ses. !,
market relative to the demsrS a" Tie
not reduce the price of STANDARD oO,, .',,
below $3.50 an ounce, but it tends s'.a a
push up the prices of everythino :. 70 "
the gold producer must buv r". ,"s'
machinery, tools, zinc, copper. cvaros' p.ea''
etc. This rise in the expansae ~ s.'Os'
cuction Is the natural economic pro
that comes into play 10 d;sco-sl'sce -Y'ce
excessive gold production i,-t i.t'u'age
decline in price Is the na+nr.l @s
nomIc force 10 prevent an e.. eeV'
production Of things other thar tbe'ss,'e s.,s
RAPIDLY rising prices in gold s.s.s sD'e
arr country are an expression os -
remuneration Of the gold rnoua. sae
unit. In the United States tber .a'7
lster the fact that the market ,,a,s .ss
the gold dollar, namely its n~ros @-as o.
ing power over other kinds NJ 80 co.ss
IS RAPIDLY declining. Dollars Of SOOes' To
iy declining purchasing power are ~ a.
lars whose supply is Increasing fsssD. w..
than the demand, for the market rss' 49,
OF dollars, like the market vain. .a'as :,
everything else, is resultant Of ~ ~
forces Of demand and supply. Ds
New-York tribune., 1918-12-22
Experience of
Europe's Bourses
Basis of New Plan
Stock Exchange Clearing
House Development as
Adopted by Governors Is
Designed TO Save Labor

In ADOPTING a new clearance sys-
l. TEN which will include both securi-
ties and brokers' loans, the governing
committee OF the Stock Exchange an
nounced that the New plan was ap-
proved after an exhaustive investiga-
ton of the clearing methods EMPLOYED
on the European stock exchanges. ST.
STREET, chairman of the special com
mitee of five which drew up the plan,
conducted that investigation, and in his
travels visited the bourses of London.
Paris, Vienna and Berlin. In a special
report to the local Stock Exchange
authorities Mr. STREET said:
"The volume of business and con-
dltions in New York are such as to
make it unwise to inaugurate a system
as complete in many ways as those al
ready in operation in Europe. but the
plan submitted is based on fundamen-
tai principles that have proved sound
through over twenty years of use
abroad, and is capable Of being largely
expanded"
In effect, under the present system of
clearance here each exchange member
delivers sheet on which is recorded
his sales and purchases of active secu-
rites. 1t has been the task of the
clearing house to reconcile all delv-
cries between different parties and to
adjust the cash differences by either
paying or receiving the balances due,
so that as little money may be required
in the settlement as possible. Under
the new plan brokers' loans also will
be cleared
Mr.. Streit found that the first we'll
authenticated system of clearing inter
mediate contracts of securities was
established in Frankfort, Germany, in
1867, although there had been systems
in vogue on less complete lines in Glas-
gov, Scotland and Manchester, Eng
land, from as early as 1S49 After the
establishment of a clearing system in
Frankfort clearing houses were adopted
by Berlin, Paris and London within ten
years, and it was from these methods
that data were secured on which the
New York Stock Exchange clearing
house was started in 1892, following a
request by the banks that the exchange
find some way of reducing stock
brokers' day to day loans.
New-York tribune., 1918-12-22
Booze in Boerse
AT Berlin a Factor

AN interesting feature of the Boerse
IN m berin was the presence in a room
directly off it Of a complete bar. where
beer flowed freely. This was even moro
notlceable in Vienna, where bar for
the sale of beer and other beverages
was directly on the floor of the Boerse
and IN both cases barmaids were in at
tendance. - g
THE operation of the Vienna Boersc
and ITS associated institutions is on
a smaller but even more perfect Scale
than in Berlin. Apparently it was the
hrst and only market to show positive
rreHectlons of the war as early as
March, 1914, as during the latter part
Of that month there were violent de-.
cllnes on the Boerse continuing at dif-
terent times over different periods. and
entirely out of proportion to anv ef.
1ects noted on the other markets of
me world. In the latter part OF March
l9l4, rumor was positive on the Vienna
boerse that the Russian armv was be
ing mobilized, and definite and concrete
statements appeared regarding an an
tagonlstic state of affairs between tbe
Austrian and Serbian governments
New-York tribune., 1918-12-22
One-'Third of Output
For Use i'm Arts

Of the worlds annual gold produc-
ton, part goes into the arts for the
manufacture of jewelry, plate, etc,
and part into monetary uses. Esti-
mates differ as to the proportions Of
the net annual production of gold that
go into these two groups of uses;
namely. merchandise uses and none
tary uses. For normal year probably
about one-third of the worlds new
cold goes into the art and two-thirds
into monetary uses.* The proportion
of Americas annual gold product that
goes into the arts is probably some
what larger normally than the proper
ton of the worlds gold product so
used. For 1919 the United States Di-
rector of the Mint estimated the net
amount of new gold bullion used in
the arts to represent 42.2 per cent of
the total gold produced IN the United
States. For 1914 he estimated it to
represent 500 per cent.
For the past six years the annual
gold production of the world and Of
the United States by calendar years
See on this subject Andre. Touzet En-
plols industrieles des Metaux prGcieux Paris
1911. PIP. 116-128.
New-York tribune., 1918-12-22
Gold Price
Never Varies

IN the United States there has prob
ably beer falling oft in the const.rnD-
ton OF gold in the arts since we en-
tered the war. The government more
ever, has taken action greatly curtail-
!ing the supply Of gold available for use
IN the arts. These are not times to
permit the tying up Of labor and capi-
tai IN the production Of god jewelrv
and plate on any considerable scale. A
reduction of one-ha.f in our normal
peace time consumption Of gold in the
4rts would release enough gold for the
monetary uses to much more thar COM
pcnsate for the decline in American
gold production that has taken place
since the war broke out
Let US now pass TO a brief considera-
ton Of the proposal to stimulate the
production of gold for monetary uses
Assuming the maintenance of the
gold standard, gold is the only com
modify IN America whose price never
changes. If the supply Of potatoes.
copper, steel, or anything else decreases
relative to the demand, their prices
rise. If. on the other hand. the supply
increases relative to the demand. their
prices fall. No SO with gold. If the
gold supply of the world. or the gold
supply of the United States under It's
present gold embargo, should suddenly
be multiplied five-fold. the price Of an
ounce OF American standard gold would
still be $3.50, while if the production
of gold in the United States and its
lmportations should suddenly be stop
ped, the price of gold per ounce
would not advance one iota. The rea-
son is obvious. We are on gold
standard. and our mints will coin
freely all gold brought to them at the
rate Of 25.8 grains of gold 800 fine to
the dollar. At any United States mint
2o8 grains Of gold 800 fine can be sold
1or SlO, while a new ten-dollar gold
piece when melted down Yields gojd
bullion to the amount Of 25s Grains
500 fine. The bullion and the coin are
practically equivalent in value because
New-York tribune., 1918-12-22

Professor Of Economics and Finance IN
Princeton University
NROM 1878 to 1898 the gold price Of
$1.30 to Ga cents. A number Of
our Western states in which silver
mining WAS an important industry were
greatly disturbed over this decline,
and they instituted a vigorous cam
paign, demanding that the government
edo something for silver" This de-
mand was the chief force leading to
the passage of the Bland-Allison act
in 1878 and the Sherman purchase act
in 1890. 1t was an important factor
in the campaign for national bimetal-
ism, under the leadership of Mr.. Bryan.
We are now confronted with similar
agitation, cmanating from the same
mineral producing regions, only this
time it takes the form of a demand that
the government "do something for
gold"
The argument as it is usually ad-
vanccd is we'll expressed in the pre-
amble of resolution submitted to the
American Bankers Association at its
recent annual convention in Chicago
the last week of September. This pre-
amble in part, follows:
Whereas, the gold production of the
world is rapidly decreasing, having
declined from slG9 600 600 in 1915 to
$3.50 000, ,000 in 1917 as the worlds output
OF this decrease. the United States de-
clined from $l0l 600 600 in 1915 to $Si,-
100000 in 1917, and it is predicted by
those conversant with the facts that the
decrease in the United States this year
will be much larger in proportion. il being
estimated by government officials to be
Sfl,000 900. based upon the production for
the six months ended June 30. 1918.
Whereas. this decline in production is
due entirely to the fact that the cost of
producing the gold ounce as a commodity
has exceeded the fixed Price of 2O.6719
per ounce and
Whereas, the only form of relief that
will prove effective and can be applied
promptly is action by the United States
government in such form and by such
methods may be deemed fit and proper
under the circumstances and
Whereas, gold Is the standard of value
and the basis Of all credit. and is vtally
important to the financial and commercial
life OF the nation and of the world: and
Whereas. the Secretary of the Treasury
of the United States has stated that next
to food and ammunition gold is the one
most needed war essential
New-York tribune., 1918-12-22

Under the pressure Of war economies
there has probably been a great fall
ing off in the proportions Of the worlds
new gold produced since 1914 that have
annually zone into the arts. This cur
tailment has probably much more thnn
compensated for the small reductions
that have taken place in the worlds
annual production Of gold. This in
itself would mean a more than normal
increase IN the amount Of gold going
into the monetary uses. Furthermore,
wildly heralded patriotic appeals in
belligcrent countries have led to the
turning over to the government for
monetary uses substantial quantities
Of gold in the form Of jewelry and
other ornaments
New-York tribune., 1918-12-22
By II. ]. Davenport

Professor Of Economics in Cornell University
"HERE are host of questions:
What will be the trend of prices,
of wages, interest, profits. ex-
ports, imports, gold movements, Stock
Exchange quotations? What will take
place in the line of strikes, of unem-
rloyment, of immigration and of taxes :?
What will be the movement of prices
relative to one another?
First of ALL doubtless, in point of
time is the problem of industrial re-
construction. But consideration of
this particular problem will best await
the discussion of the larger forces and
the more durable movements-partly
because of the dependence Of each par
ticular analysis on the larger funda-
mental principles of the longtime
movement-partly also because the
longtime adjustments will be pro-
foundly influenced by the longtime
prospects.
The chief difficulty in discussing any
one of these various problems is that
all Of them will be decided mainly by
the general trend of prices And the
general trend in prices will depend
more largely on political and legislative
policies than on purely economic in
fuepces-the economic forces working
within a fundamental setting fixed by
noneconomic forces. The first step,
then, is rather one of prophecy than
one of economic analysis. And proph-
ecy is especially hazardous here. Ac-
cordingly, therefore, as the future
financial policies work for stationary
or for lower or for higher prices, will
all the derivative movements be deter
mined.
What then are the possibilities and
probabilities as to general prices?
Particular price movements, changes
in prices relative to one another. there
will inevitably be, partly as incidental
to- the change from the wartime or
ganization of industry to a peace-time
basis, partly as the result of national
policies affecting particular industries
and products. But the present and
primary problem is the outlook for
general prices.
Precisely as in the great and funda-
mental readjustment to war basis
there were great notifications in gen
seral prices, so in the organization of
Industry for peace purposes great
changes in relative prices are in
evitable. Not SO, however, for the
general average of prices-the price
level, as it is often called, the move
ment of general prices.
New-York tribune., 1918-12-22
Everything Dear
But Money

Actually, of course, not in America
alone, but in the world at large there
mas been sharp and general rise in
prices. This has been the result of
the generally adopted methods of war
iinance-the failure to preserve con-
stant ratio between the volume of cir
culating media and the volume of
trade. Instead of policy that should
somewhat contract the currency in face
OF somewhat diminishing volume Of
production and exchange, there has
been an imitation in thecurrencv the
intermediate of exchange, the circu-
latlng medium. BY making currency
extraordinarily plenty it has been
made extraordinarily cheap. Prices
nave risen, not precisely as the result
OF cheap money, but as the report and
expression of cheap money-nothine
cheap but dollars.
whether this was the more sin than
oiunder, whether, indeed, it was
either, we need not now discuss. II
was easy. The other belligerent na-
uons, perhaps mainly because thew had
neen at war the longer, have carried
further the imitation process, and have
therefore brought about the greater
disturbance of prices Russia carried
the process so far, adopting the direct
issue OF tiat money, that these issues
came to be discredited and the entire
system of exchange collapsed. What
ever else may have contributed to nre-
clpltate the collapse, the financial pol
Icy OF Russia must have brought it.
Germany and Austria, next to Russia
nave most relied on imitation. 1t was
no small factor in Germanv's collanse
that finally, with a waning confidence
IN victory, her money system was dis
credited, that her circulating medium
would not circulate and that she was
reduced to the direct inhations of
paper money issues. Thus Germany
was done for, irrespective Of the fail
ure OF her military campaign. Her
enemies needed merely to wait She
was initiating herself into a paralysis
OF production through paralysis of
exchange. Now she faces not only the
problem of what finally to do with her
card house of Indebtedness incurred
by price-raising devices, but what i'm
mediately to do to command revenues.
and what ultimately to do with the
high price level and the disappearance
Of the exchange media to support it.
New-York tribune., 1918-12-22
What Has
Been Proposed

From premises such as these the con-
clusion is drawn that the United States
government should edo something for
gold A number of plans have been
suggested, but the two that have re-
ceived most favor are (D that the gov
eminent buy all new gold presented to
it at substantial premium over its
present fixed price, namely, $3.50 per
ounce of American standard gold 900
New-York tribune., 1918-12-22
Steady Decline in
urchasing Power

The purchasing power Of the noa
dollar in the United States has bs.u sY,u
declining almost continually since ises
and this decline has found exnress;oS So
N the rising cost Of living. which 80. ~.
agitated the public mind for the lass '.ss
twenty years. If one measures the mas ,aV'
ket value Of the gold dollar bv its n~r
CHASING power over the TWO hund-sd
to three hundred commodities wSo.a
wholesale prices are covered bv tba ~
deX number of the United states pn-
reau OF Labor Statistics. and If ona
calls the dollar OF 1895 The wear wbsn
the present upward movement Of nricss
Degan) a 100 per cent dollar. then tho
dollar of 1913 was a 81 per cent iollsr
and that Of August. 1918. was "a ns-
cent dollar. Fhe depreciation Of .ba
dollar has been particularly strikins
s'nce the war broke out. its purchasine
power over wholesale commodities bar.
ing been cut in half since Juiv 1914
and It's purchasing power over retail
commodities. such as constitute abont
so per cent Of The average laborirs
mans family BUDGET. having been cpt f
down about one-third ~. Never be-
lore IN recorded history would an ouncs
New-York tribune., 1918-12-22
Clearing House
Saves Labor

Many changes in detail had to be
considered, owing to the system of
daily settlements here. but the funda-
mental principles remained, and. as
Mr.. STREET puts it, "the clearing house
has proved to be OF great value in saw
ing labor and reducing the demand on
banking facilities"
In Paris, Berlin and Vienna, he as
Sserts, the functions of the clearing
houses have been developed further
than heretofore considered possible in
New York, involving the principle Of
ohsettlng debts and credits, both of
money loans on securities and clearing
house stock balances, together WITH
the receipt and delivery of all securi-
ties at a central institution.
vi these methods, that in Paris is
the simplest. while in Vienna the cen
trahzation of control was found to he
muca greater, which was made possible
by the fact that banking institutions
New-York tribune., 1918-12-22
Americas Problem
The Simplest

Thus far the Entente countries have
been confronted with no menace of
purely monetary collapse, but only
with, the difficulties of inflated prices
and q derivatively swollen bonded in
debtedness. America, as having support