Gilpin observer., 1920-06-10
WHY SILVER DROPPED
TO LOWER PRICE
European Nations are Melting Up
Coins Made of the White
Metal.

Just what has caused the price
of silver to drop since April 1st
from $1.26 to practically $1.00 per
ounce is attributed to almost as
many causes as there have been
financial writers on this subject.
1t seems probable, however, that
while there were many contribut-
ing factors, that the chief.reasons
were outlined by Senator Pittman
when he said:
There has been inquiry also
made from numerous sources as
to the reason for the fall in the
price of silver below a dollar an
ounce. l am informed by the best
authorities l can obtain, and also
by the experts of the Treasury
Department, that it is caused by
peculiar conditions. Germany is
melting up its silver coin for the
purpose of foreign exchange.
France is doing the same. Ger
many was expected to purchase
silver as reserve behind it's pap
er money. 1t has nothing with
which to purchase silver or any
thing else. The only value that
it has to purchase with today that
has par value is it's silver coin.
France is largely in the same pos
ition. For that reason there is an
unusual quantity of silver sudden
ly thrown upon the market. 1t is
only temporary, as am informed
by the authorities, because it will
soon be absorbed in the worlds
markets, where there is tre-
mendous demand for silver; but
that condition does exist.
There is another condition af-
fecting it. The East-China and
Japan-were starved for the want
of silver during the entire war.
Immediately after the cessation
of the war or the signing of the
armistice the embargo upon silver
was lifted; these countries went
into the markets and competed
with each other for the purchase
of silver, and they not only salts
fed their demands but drove the
price of silver quite high. That
demand will again come, and
come quickly, with the re-estab-
lishment of commerce, but such
is the situation now.
II want it distinctly understood.
however, that the act only pro-
tects silver produced and reduced
in this country. We melted up
271 100000 of silver dollars un-
der the Pittman act. Under the
act that 271,OOO,OOO silver dollars
must be returned to the treasury
of the United States in the form of
coined silver dollars and the bull
ion for that purpose must be pur-
chased from our American mines.
In addition to that it must be pur-
chased from our American mines
whenever the silver is rendered at
81 an ounce, which is the price at
which the silver so melted up was
sold by our government.
"There is nothing to prevent
Mexican or Canadian or German
or French silver from being sold
to the industries in this country
at any price less than a dollar an
ounce. Anyone may sell it for so
cents an ounce. There is no at
tempt to protect that price of sill
yer, so far as foreign countries
are concerned, but, at the same
time, when foreign silver is being
sold in our markets to our indus
tries at less than dollar an ounce
our government has obligated it.
self, and is pledged to carry out
the obligation, to purchase Ameri-
can silver at 81 an ounce.
$50 there is only one thing for
the producers of American silver
to do, if they desire to sell silver
when the market price is under a
dollar, and that is to tender their
silver bullion at the mint in New
York, Philadelphia, Denver, or
San Francisco, together with the
proper certificate of it's origin as
American silver, and receive 81
an ounce.-Mountain States Min
eral Age.