Evening star. [volume] (Washington, D.C.) 1854-1972, 1938-08-21
Uncle Sans Huge
Silver Brick
By FREDERIC J, HASKIN,

sponslble for coming the phrase "a gold
brick" as designation Of something not
worth what was paid for it. The term
arose from the fact that INSCRIPTIONS
sharpers were wont to sell to the unsus-
pecting, bricks Of lead with thin gold
plating, claiming they were solid gold.
1t now appears that Uncle Sam may
have purchased not gold but silver
brick. A difference is that this brick Is
real silver, but the fact remains that 1t
Is worth far less than what was paid fM
1t. 1t may be that those in charge of the
purchase will prove to have been justified
in the end, but as matters now stand,
Uncle Sam Is in possession Of the largest
silver brick in the world, purchased at
price far above it's value.
The American public, by now, Is well
acquainted with the vast hoard OF gold
some $12, 900 900 900 worth at the Ameri-
can valuation-Which Is stored at Fort
Knox, KY, the special, fortified reposi-
tory which was especially constructed
for it there. 1t has heard less OF sim
liar place OF security built for silver ut
West Point. 1t is interesting to note that
the Nations gold and silver have been
placed at fortresses as strong as any Of
the French Maginot line.
How large this silver hoard Is can best
be described to the lay mind by explain
Ing the terms Of contract under which
the Treasury recently arranged for the
trucking Of the silver hoard to West
Point. Twenty-Five trucks will carry
silver each day five days week, under
the contract, and even at this relatively
rapid rate, 1t will take nearly 10 months
to complete the job. Each truck will be
protected by guard of Coast Guards
men.
Only the silver in New York vaults will
be moved under this contract. 1t
amounts in value to 81 900 5000 Lit
tie danger OF robbery is anticipated, be-
cause silver is SO heavy, in relation TO
value, that the risk for the prize is too
great. 1t is likely silver from other re-
positories will be ultimately removed to
West Point. In all, the Government has
more than $4,000, 900 900 in silver bullion"
in addition to more than 5000, 0000 900 in
subsidiary coin.
This figure may seem small In COM
pariSon with the Sl2, 000, 900 900 gold
hoard, but it must be remembered that,
at the American valuation gold is worth
almost so times as much as silver. If
the gold hoard were as large in proper
ton. as the silver one it would have to
approximate 500, 900 100000 Just as
the American gold holdings are the larg-
est ever accumulated by any nation in
the history of the world, so are the silver.
holdings. The United States has half
the worlds gold and more than half the
worlds silver.
The United States has had three CAM
paigns of silver purchase in the past.
The first was century ago and was
minor in scope. Again, in 1873 silver
was purchased by the Treasury and pur-
chases continued for Is years until
brought to stop when President Clevea
land called for an end in the panic Of
1893. Over that 15-year period $751;
100000 in silver had been purchased.
Many efforts have been made to estab-
lish a monetary silver standard, but
there Is no such standard anywhere In
the world nor can there be, because sill
yer is commodity. like coal or lumber,
which rises and falls with the world
market. Gold is always the measure of
silver's value. During the World War
the commodity price Of silver ross to a
point where 81 20 was the market price
for the amount of silver in a silver dollar.
For a combination OF reasons, one to
prevent the melting down Of our coinage,
the Pittman Act was passed fixing a
price of 81 an ounce on silver. There is
an ounce in silver dollar.
Nothing could better illustrate how sill
yer is a commodity rather than a none
tary value than the fact OF its price de-
cline during the great depression. In
1892 it reached a low of 278 cents an
ounce. decline OF more than 81 from
the high just before the Pittman Act was
passed. In 1888 silver conference was
held at London at which eight powers
agreed to buy silver at a price OF 347
cents an ounce. The next big move
came in 1884 when President Roosevelt
nationalized silver here. This was done
at the behest Of Western Senators who
declared grave unemployment was
caused because mining had ceased, the
price being too low to make such enter
prises remunerative. There are no silver
mines in the United States, but much
silver is mined as by-product Of lead,
copper and zinc
The American fixed price quickly went
as high as 70 cents, which was all out of
line with the world price Of 34.7 cents.
One dire result was tremendous de-
preston In China. In that country silver
Is the money used, but with the United
States bidding so high, silver ran In a
stream out OF the country with the result
that there were serious shortages. Banks
closed. factories shut, business men
leaped out of windows as they did here
in the 1929 crash, and unemployment
was general. Suffering was great. All
caused by the American silver price. AL
though China placed An embargo on sill
yer, the Chinese Smuggled the metal
through in large quantities. Chinese are
adept at smuggling, whether in or out.
The United States was committed to
its policy of buying at it's fixed premium
price, so not only did China send her
silver here, but SO did every other coun-
try. The signatories to the London silver
conference kept their agreement to buy
at 347 cents, but then, of course, turned
around and sold to the United States al
twice the price. 1t was good business for
everybody except Uncle Sam. The West
ern mines were getting their high price
and so were the foreigners. No one
cared about the distress of China,
China Is long way of.
Last January the Presidents price was
dropped from TIL cents to 64h, th1
present price. but buying continues at
that figure. China has been forced I'd
in its thousands Of years and. Of course :
trade between the United States and
China has been disrupted.