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down anyway; just as a failed bank might not have succumbed if nobody had started a rumor as to its solvency and no depositor had been mean enough to start "a run."

The fluctuating and declining value of silver during the past twenty years, and the fear that an unlimited quantity might or may be produced, coupled with the stability of gold during the period since the discovery of the Californian supply,' and the belief that all gold-mines, together, cannot be sufficiently prolific to affect the value of gold, have made gold the standard of value for great commercial nations, and have served to fasten silver upon the weaker commercial nations as their standard of value. If a country trading with England or the United States would take silver it would be sure to get it, for everybody pays debts with as cheap money as creditors will take. If a country persisted in coining gold, and in refusing to coin silver, that country could not have any other country's surplus of silver dumped upon it. Possessing inexhaustible mines of silver, we favor the use of this metal as a standard of 1 And, later, the South African supply.

value; but it cannot be to our interest to lose sight of the fact that silver is already discredited by the commercial world,-not merely by governments, some of which might be induced to change, but by commerce itself, which selects for itself the best standard of value. As well say to the world, We have plenty of wood in this country, we will build a wooden navy, and then you will discard iron-clads; or, We will give up using electricity, and then you will go back to steam and to candles and oil; as well take such a position, as to say that the world would follow our example if we should abandon gold and fully adopt silver for our standard of value. Evolution is as irresistible in the financial and commercial world as everywhere else; evolution has selected gold, and has rejected silver; and all we can do in the matter is to decide whether we shall take as our standard the selected metal or the rejected metal,—that is, stand with the great nations or with the weak nations. Wampum was perfect money for the Indians, and was a fair sort for the colonists,

but was of no use in foreign commerce. Wampum cost time and labor to produce, but Europe did not want it; and arguments to prove to Europeans their own perversity fall about equally flat whether in favor of wampum or of silver, excepting, of course, that Europe wants some silver, whereas it never wanted any wampum. Two facts overcome all arguments; the production of silver has too largely increased, and the price of silver has too greatly declined.

Statistics show how naturally silver has lost caste as a standard of value. Up to 1870 the world's annual production was less than half so great as the annual production of gold (coinage value), and therefore the price of silver was above one dol lar and thirty cents per ounce, the parity of the two metals being close to fifteen and one half ounces of silver to one ounce of gold. But while the average production of gold has not materially changed,' that of silver has so largely increased that it is now

1 NOTE TO FOURTH EDITION.-See table on page 160 and also the foot note.

about one third greater than the produc tion of gold. There are grounds for be lieving, too, that gold will be still further distanced. Under the circumstances, the supply of silver far outrunning the demand, it is not unnatural that silver should be worth, to-day, less than one dollar per ounce, and that the ratio of value should be about twenty-one or twenty-two to one. Sixteen to one is the United States coinage parity, corresponding with $1.2929 per ounce for silver,—say thirty per cent. above the world's price.'

Trade and civilization could hardly have developed beyond a primitive state before the business of banking must have come into existence, crude, but essentially similar to modern banking, the intricacies of today's financial operations corresponding to the intricacies of to-day's trade. And as a large portion of the inhabitants of the globe would have frozen or have starved, or never would have come into being, if the world had not learned to use money, simple barter being wholly inadequate to perform the smallest fraction of the ex

1 In 1896 the price of silver is about sixty-eight cents per ounce, the market value ratio to gold being about 31 to 1.

change of products, so financial systems are absolutely necessary to the business of the present time, the world's population now largely depending for the continuance of its existence upon the success of the schemes of dead and living financiers. In other words, the needs of the world outstripped the greatest volume of exchanges possible by barter, next the greatest volume possible by both barter and the use of money, and now, apparently, the volume of exchanges is limited by the degree of perfection attained in financial science, transportation problems being often only financial problems.

The ancient planters of rice and wheat must have been short of money while their crops were growing, for then the planters would have been obliged to support their hands while receiving nothing; at and before harvest-time a money-lender must have been as useful as a banker of our day, who annually sends money westward, "to move the crops"; and immediately after the selling of a crop the ancient producers would have been in position to lend their surplus

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