Every evening, Wilmington daily commercial., 1921-11-12
GOLD INCREASING
IN VALUE
BY ROGER w. BABSON
can Rights Strictly Reserved

While the price OF every other meta,
went up during the war gold remained
stationary. This. OF course, wa. due
to the fact that gold Is the standard
on which our monetary system is
hased; that 25.s grains Of gold ar,
worth H.o0. year in and year out re-
gardless Of conditions. Simply because
the price OF gold Is fixed II does not
follow that its value Is fixed. On the
contrary the value of geld fluctates
Just rs the value OF the dollar nuctu-
ates.
The real value of the dollar IL de-
termfned by tho amount of commodi-
ties or goods. or both, which il will
buy. 1t is obvious that when prices
OF commodities and goods rise YOU can
not get so much for your dollar and
when prices decline YOU can get more
IL Is the same with gold. Due to the
rise In commodity prices. which was
going on even before the war start.i
gold was gradually decreasing in
value, but the violent rise in COM
modities. which took place during the
war and after, caused the value Of
gold to drop quickly to abnormally low
levels. Commodity prices reached
their high levels in February 1920.
c. nsequently gold dropped last year
10 its lowest value
| Since February 1920 commodity
prices have had tremendous decline.
Bradstreet's Index which reached a
high of 2o.S6 in that month is now
Ills as compared with the low rec
ord of $40 in 1896. If history repeats
itself, and / have every reason to be-
lieve that it will. the high prices OF
last year will not again be witnessed
for about two generations Not only
that, but there should be downward
trend Of prices for about one genera
ton. Understand / am referring &c
the broad. long swing movemen.. Al
of which is another way of saying thai
gold should increase In value for tl,e
next twenty to twenty-five years.
What does this mean to- gold min
ing companies ana gold miairg Sc
curities? 1t means that gold min
ing companies will show a gradual in
crease in profits for long time e
ccme and that gold mining securities
should gradually increase in val c
During the vast ten years gold inins
companies have really been worse OF
than railroads and public utilities
. IL ilroads and public utilities iinall.
!, did secure increase in rates, but tn
gold mining companies have not bec'
able to obtain one c, mt moe por uni
of output than they did before IN
war. The result, OF course. has beel
that their profits vanished. and tha
while industrial securities were soar
I ing to high levels, gold mining Sc
r curities declined to abnormally 10y
levels.
From now on. however, condition
I. .yill be very favorable to gold mine
and their securities. From the natur
4 4 Of gold ores gold mining securities AZ
: inherently speculative and they shoul
T bt, selected with the greatest ca
: bat / see no reason why well 81
E lected list of gold mining securiue
e should not prove to be very profi
= able venture at the present time.
!. General business, meantime, follow
g it's sidewise movement. 1t is rur
J; ming 20 per cent below normal jn'
! as II was q week ago. This Is, ho"
n ever, but Q per cent under its Sci
= tcnlbcr record Of but is per cent b'
loy normal.