The Washington herald., 1920-02-27
WAR INITIATION
And 1870 T.
Experts See Some Founda-
ton for Old Time Myth in
Present High Silver.
RADICAL CONTRASTS
Free Silver Days Vastly Diff
ferent from Present n.
c. Of l." Era.

Bullion experts declare that the
advance in the priceSof silver dur
ing last month to s1.3 foreshadows
the approach of bi-metalism or
rather proclaims that bi-metalism is
here. These experts explain the ad-
vance in the price of silver by the
statement that the world imitation
Of currency has forced a number OF
countries to adopt silver as a re-
demption metal at the ratio of ap-
proximately 16 to 1.-The ratio put
forward by the silverites In the SOS.
However. there is a vast difference
between now and then so far as the
relative values of gold and silver
are concerned.
When the Free Silver advocates
made their claims in the SOS silver
had an open market value of about
80 to 1. and its coinage at the ratio
of 16 to l would have consumed
about twice as much bullion as
would be consumed now If the same
ratio were adopted. There is per-
haps some basis for the contention
that some Of the countries which
formerly maintained gold redemp-
tion in theory are now inclining TO
the double standard. 1t, Is also
maintain its present currency infia-
tion upon a redemption basis it will
have to find more gold or use silver.
The total gold supply Of the world
runs to something over $4,000, 900,
900. of which we have approximate
~ one-third. The currency imitation
during and following the war
reached an essential increase OF
800, 900. 200, ,000.' against which all
the gold in the world would provide
gold redemption for about 2 per
cent. The Federal reserve banks
are required to maintain 40 per cent
gold against their notes: so IL is
apparent that the increase in cur
rency in the world has effectively
destroyed the gold basis in every
country in the world except our
own. There are only two remedies
compatible with the continuance of
metal redemption, and these are de-
fiation and bi-metalism.
Some of the strongest advocates
of bi-metalism have appeared from
among the ranks of the anti-defla-
tionists-the men who contend that
current values should be aintained
or allowed to recede in accordance
with natural laws and should not
be artif1cially reduced. They base
their position upon the contention
that most of the debts and con-
tracts now outstanding were ef-
fccted at the current level of price
and that defiation would work harm
to greater number of the people
than would be the case if the Pres
ent level of prices were adopted
as the basis for future operations.
By adopting bi-metalism We
could. according to its advocates,
go ahead without fear of doing any
more harm than has already been
done. We have already harmed
those who saved before the present
level OF values came into effect, II is
said. and 1T is to be doubted IL we
could undo the harm inflicted upon
individuals by resorting to defia-
tion. Those who were injured seri-
ously have already been forced to
liquidate, and what they sacrificed
has come into the hands of new
owners at current values, so in ef-
feet the advocates of bi-metalism
say there are no remedies that
would benefit those who actually
suffered by the advance in prices.
Those who would benefit, II is de-
clared. are those who have equal
lzed their losses, or who have al
ready benefited many times from
the present level of prices.
The anti-def1ationists do not be-
lieve that the monetization of silver
would result in a further expansion
they contend that the most II
would do would be to maintain the
present level of values. The ques-
ton is one Of which we will pos
sibly hear much more in the next
few months.