Year: 1875

other causes affecting the demand and supply would
produce serious decline IN the value OF SILVER aud IN
jarously affect silver mining interests To provide


market for the silver mined IN the western portion
OF our country coin or standard likely 20
make II acceptable in China was authorized
early in the following year, 1873 About two
years afterward January 1875, law looking to the
substitution Of silver for the paper fractional currency
was enacted Upon q superficial examination Of the
trade dollar II may be supposed 10 interfere with the
plan or substituting silver for tho fractional currency
Such however Is not the case its coinage not having
the least effect the general market price OF silver
The real effect Is 70 make something Of local market
a. San FRANCISCO, and II our annual production
~ that me4n was not more than the wints
could coin the silver produced on the Pacific
coast would command slightly better rates, but the
fact Is the coming capacity OF the mnts for silver CONS
of less denomination than the dollar Is not equal 20
more than half the production and the two years
yield of the mines will IL is probable, furnish sufficient
silver 10 manufacture all the fractional that be
advantageousy used In the country After the redemp
ton OF the fractional notes silver coins with the exoep
ton Of the trade dollar only be issued under the
coinage laws as exchange al for gold coins ana az
this limitation will be barrier TO their excessive coinage
the demand for bullion for that purpose must after TWO
or three years, be quite small. The coinage rate OF
silver in trade dollars Is 81 IA zs per standard ounce
One and quarter per cent on the nominal value equM
70 AZ lOo cents per ounce gives return - sne M %
postor IN that coin OF nearly ll3 cents per ounce Ihe


fact that the average price OF silver purchased Tor the
fractional coins has been only 81 IL o4 per standard
ounce proves that the trade dollar coinage mas not IN
nuenced the price 10 any percepttble extent


Nearly all the silver bullion which finds market In
San Francisco is from the Comsock mines, and con
tains on an average fortyhve per cent in value
Of gold This bullion must be refined or parted before
il can be manufactured into coin, and the most
economical proportion OF the two metals for the parting
operation parts Of silver by weight TO one OF gold
This class Of bullion commands higher price in
London than fine silver, for the reason that
gold containing a small percentage Of silver can be
added and thus refined parted without additional costa


This bullion, not parted with a. san francisco ana
TO exchange and therefore cannot be made available


for mnage al the New York Assay Office and the mint
at Philadelphia Our true policy Is 10 mint this bullion


the United States ana since If not parted on the Pa
cfc coast it is exported 70 London, the trade dollar
coinage should be continued If for other purpose
than to make local market tor the silver Ultimately,
China must have national coinage of silver,
and in the meantime a more extensive use of the
silver coins Of other countries viii be found useful not
only TO the Chinese bat likewise 70 foreign residents at
the different ports. The American trade dollar has
been well received in that Empire, and II authority
were gwen 70 coin at our western mints nve, ten
twenty and fifty cent pieces or the standard they
commercial ports, and gradually work their way into
the interior Of the Empire II this trade coinage should
incidentally afford protection TO our mining Interests
which have already been inurousy affected by the fa


in the value of silver II could hardly be regarded other
wise than as sound national policy.


The director then proceeds to show the preparation
MADE for the redemption OF the fractional currency
der the specie resumption act OF January H. 1875 and
aerward discusses at length the occasional dis
turbances in the money markets Of the world which he
attributes to insufficient supplies OF gold but TO its
having been withheld in large from circulation
and the diminished Of silver money, attribual
either directly or remotely to the money system
IN the German EMPIRE by winch exclusive gold
standard was established, and continues


From what has been stated II will appear that gov
ernments banks and exchange dealers have, during
the period under review purchasers of gold which
was likely to advance in value, and sellers Of silver
which showed Indications Of decline and that the
course Of the precious metals during the last two
usual influences previously operating but by transac-
tons of unusual character and magnitude involving,
necessary consequence large and sudden transfers
OF coin and bullion from one country TO another WHICH
by raising depressing prices created wide field for
speculative operations Fortunately, such condition
longer.