Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1919-12-13
SILVER COMES BACK.
BIT FREDERIC ]. HASKIN.

1 &
SILVER COMES BACK.
BY FREDERIC ]. HASKN.
Especial Correspondence Of Tho Argus).
Washington, D. c., Dec. 1.-THE price Of
silver has recently gone above $3.50 an ounce
This fact, means very little to the average
American. Even when he is told that silver
was worth but IS cents back iA 1014. and that
the present price is nearly three times that
figure. he il not perturbed.
But there is an unusual element in this
case. The silver dollar which is used as cur
rency Ia this country Is worth more rs metal
than as money when silver goes above 129.
When an individual may take q hundred sill
yer dollars and melt them and sell the re-
sultipg metal for more than hundred dollars.
there are sure to be people here and there who
will go into the dollar melting business. As
q matter of fact, there is no law to interfere
with the melting of silver coin. Anybody who
has dollar and wants to melt it may do so.
So it appears that if silver goes much higher
there willrbe the danger Of large industry
growing out Of dollar melting. II such an in
dustry develops it Is obvious that silver coin
Will rapidly disappear from circulation. II
the government attempts to replace 1t. the
result will be but to increase the material from
or later the end of the reserve silver supply
VI the United States would be reached and
then. when the coin was melted. there would be
none to take its place.
This is theoretically what would happen
when silver goes above $130 an ounce, or $1.29
TO- DO exact. OF course the price would need
to be several cents-over that amount to pay
for the melting and to yield profit that is
worth the effort. The dollars must be new.
also, for old dollars have lost some of their
weight So 1t is apparent that the metal must
| be up to $1.35 or better before there will be
much lEelting. 1t has not quite reached that
figure yet. -.
The government would not worry much II
the silver dollars should be melted. It has not
coined silver dollars for a long time. 1t may
never coin them again. 1t is about converted
to the belief that only subsidiary coins, those
of the fractions of dollar. should be Of metal.
Unless policy changes. the old iron man is
destined to take his place. with those who have
| gone before.
But the subsidiary coin We must have
Dimes and quarters and half dollars are in
dispensable. Were there danger of the silver
melters getting busy on subsidiary coins there
would be occasion for real worry.
It happens, however, that the coin makers
in the very beginning, took preczution which
fits exactly into the present situation. 1t would
be interesting to know il that action was from
foresight or by accident. Anyway they put
less silver in proportion to their value into the
subsidiary coins than they did into the silver
dollars. Ten dimes, four quarters or two
halves, weigh exactly the same amount Wher
they come from the mint. But dollar in any
OF these subsidiary coins weighs less than doef
a dollar CON- While silver must be worth
more than $1.29 an ounce to affect the dollar
coinage. it must be worth more than $1S8 t.
endanger subsidiary coinage.
As matter of fact 1t will have to be around
$1.45 or $3.50 to pay for the trouble take cart
of abrasion and pay anything like q worth
while profit on the melting business.
So the government is not yet worrying
about having its dimes and quarters melted
When the point of danger Is reached there ar,
several lines Of government action possible
During the war there was an embargo on sill
yer. II this embargo were put back, the de
mand would be cut of, and the price nigh
tumble, Then there is the possibility of pro
hibiting the melting of subsidiary coin. Thi
would discourage the industry. The treasur,
has many million of dollars worth Of silve
and could readily replace lesser losses. Their,
is much silver in treasury vaults in bullion
There are vaults in New York. Philadelphia
Denver, in which gold and silver is stacked VI
like sacks in granary. 1t is measured in tons
In carloads, even in shiploads.
To appreciate the present silver situation
one must 60 back to that As. cents an ounce /,
1914. He must follow the, record back an,
find that the price has played back and fortl
from 50 cents to 20 cents for 80 years. Neve
before since 1890 has silver gone above dol
lar an ounce. Not since 1866 has 1t been u,
to its present price. Until this war came
the decline had been constant since the Civi
war. Eefore the Civil war silver ranged regu
larly around a dollar thirty to thirty five. /
probably was in those days that the presen
amount Of it came to be put into our COINS thu
giving them an actual intrinsic value abou
equal to their face value.
The present boom in the silver market
due principally to the demand for the meta
in the far east. There is likewise deman
from several Of the European nations that hav
issued large amounts Of paper money and ar
! anxious to get metal back of it to steady tina
currency. But the chief demand is from India
China and Japan, all Of which are on silve
monetary basis.
The Orient is buying silver direct from u.
No longer is the silver business done throug
London. New York is the silver center 9
the world. Probably England, which produce
no silver, will never become the silver cente
again. Probably the orient will bid diree
through America America is interested i
good prices for silver which England was nd
Possibly permanent high prices for silver ma
result from these changes.