New-York tribune., 1922-03-05
Amount in Hands of pri-
vate Firms Is Very Small,
Vice = President of Ma.
'ional City Bank Explains
Mainly in Reserve Banks
Concentrated Stocks of All
Nations Are Under Gov
ernmental Supervision
By George Z. Robert,

/ A"eSu functions. ]. e.. as q
medium of exchange aid as
standard of value. In the first in.
stance 1t passes from hand to hand
and is itself exchanged for goods or
services; in the second instance Il
may not be handled at all. but goods
and services are valued and OK
changed by reference to it. As the
greater part of the domestic and in
ternational trade of this country is
carried on by the latter method. it
is important to keep the distinction
in view.
Money in the beginning of its use
performed both functions; that is to
say 1t Was something that had value
IN Atsef and passed current as the
direct means by which the exchanges of
other things were effected. As the di-
vision of labor developed and men be-
came dependent upon trade to supply
their wants, they sought to convert
their own products into the kinds Of
property for which the demand was
most constant and which could be most
readily disposed Of
Each producer traded his product
either Tor something that he wanted
for consumption or for something that
ne tnought had wider or more con-
stont market than his own product
fundam entally, it was direct ex-
change of values. Cattle, various prod
ucts OF the soil. the metals, were all
used, and process of elimination be-
gan which by popular choice gradually
shortened ihc list of commodities thus
used for gold and silver, and finally,
foi the greater part of the CONNIE rcial
world, to gold
This is perhaps as good a place as
any 10 refer to the leading argument
against gold as the standard of Value.
It is said that gold has no real value
IN itself, that it does not minister to
any fun damental human want. that So
ciety could do without it far better
than without the products which serve
for food OF clothing, or without iron
and numerous other articles Of utility.
/ But after this is admitted it does not
prove the contention that gold is not
suitable for the standard of value. Ii
society had to choose between doing
4 without the necessaries mentioned and
doing without gold it doubtless would
choose to dispense with the latter, but
It does not have to do without either.
A great many thing that are not pri.
mary necessities arc in constant de-
mand, and year after year command
prices in the public market that are
quite as stable as the prices of wheat,
cotton or iron. Fine pictures, good
music. good acting are not primary
necessities, but the people who can
supply them always command high paw
as compared with those who produce
corn and cotton.
Trade Fiaes Value
1t has been said that one mans meat
is another mans poison, and the infer
ence is that it is best to let every man
determine for himself what he shall
eat and what things have value for him.
Not much is gained by arguing alb
stractly about the utility Of things
which people want. whether it be gold,
automobiles or anything else. Com
mercal values arc not fixed by theo-
retical arguments, but By trading in
the market place. Values represent
a consensus of opinion.
The earliest historical records show
that gold and silver were esteemed in
all times and by all peoples as precious
metals. They were priced for their
beauty and the other qualities that
distinguish them. In the countries
where they we're found they were used
as money as far back AS records go,
and long before there could have been
any concert of action to establish their
use.
The book Of Genesis reflects condi-
tons at very early period of society,
and it speaks Of both gold and silver
as articles CT established use and
| value:
Their early use as money was not
due to governmental action. for coin
age is Of comparatively recent date.
They passed current by common con-
sent, as pieces" o. gold and silver.
Joseph gave to BENJAMIN. 300 pieces
Of silver, and the Saviour al much
later date was betrayed FOR thirty
"pieces" were of practically uniform
size, prepared to pass as money, but
not an official coinage.
Payments ~ eighed''
Frequently the records speak Of the
payments as being weighed" One of
the earliest financial transactions Of
which there is any record is that in
which Abraham, who is believed to
have lived some 1000 or 5000 years
before Christ, purchased a burial place
1OI MS WlIS CdiAI'
Coinage was not adopted fer the pur-
pose OF giving value by the stamp OF
authority, but for thc purpose OF GER
tifyine to the weight aas tlneness Of
the piece. Many Of the best knowa
coins OF history show By their names
that they were derived from weights in
common use. This was true Of the
Jewish Shekel and the British pound
was originally pound weight OF silver.
The reasons for the preference that
was early given TO gold and silver over
other comm cdities which to some ex-
tent were used as money are not dit
ficult to find The metals were uni
versally esteemed; they possessed rcla-
lively high value in proportion to bulk
and thus were easily transported,
! stored, concealed and protected; they
do not deteriorate with time and are
not destroyed by fire, being in these
respccts. as we'll as in the quality last
named. superior to any of the products
Of the soil; they are malleable. ana
fusablc, and since they are practically
indestructible, the new production or
each wear becomes part OF the per
manent stock. so that the fuctuatons
in production and in value from year
to wear are of much smaller conse-
ouence than in the case Of the products
of which the annual crop is nearly ali
consumed during the year
. Traders seek out the most cconom'
jcal methods Of conducting their bus'-