THE NEBRASKA INDEPENDENT
MARCH 6, 1903.
THE VALUE OF MONEY
Mr. D Hart Continues-Dow "Fra" Cola
' s Work and Whr
CHAPTER II.
- Editor Independent: That great
Work modestly entitled, "An Inquiry
Into the Nature and Causes of the
.Wealth of Nations," and Ricardo'3
great work entitled, "Principles of Po
litical Economy and Taxation," con
stitute the political economy of Great
Britain, which does not differ much
from French political economy. Fori
thi3 reason I shall continue to quote
from Smith and Iticardo especially
the latter, whose work was really a
supplement to that of Dr. Smith.
Both Smith and Ricardo seem to be
Ignorant of the fact that prior to the
year 1C66, there was no such thing as
"free" coinage in England. One may
occasionally read that coinage is
"free," but it is not spoken of as any
thing unusual, or as anything that had
recently come into practice.
"Free" coinage commenced in Eng
land very quietly. No historian, other
than Mr. Del Mar, mentions the fact;
and when I read it in Del Mar fifteen
years ago, I could not believe it, till I
had consulted the English statutes and
found, that there was no law author
izing free coinage till the fifth year of
Charles II. (A. D. 1666). I must
therefore believe that this law was
passed as quietly in England as "free"
coinage of silver dollars was discon
tinued, by statute, in the United
States in 1873.
To me the opening of the mint of
England In 1CC6 looks like a regular
Jew trick. At that time the gold
smiths were the bankers. People took
their jewelry and other precious goods
to them for safe-keeping, the bankers
giving receipts. The receipts circu
lated like so much gold and silver,
very much as bank notes do now.
These men, Jews, having all the gold,
silver, precious stones, etc., in their
possession, thought it would be a good
thing, for them, if they could get
the mint opened to "free" coinage.
This would enable them to be the
manufacturers of money and to con
trol the volume of money of the king
dom, and thereby, in a short time,
control the finances of the nation, a
power which the sovereign had previ
ously exercised.
Charles II. not being as smart in
money matters as the Jews, readily
consented to the arrangement, and
free coinage became the law as quietly
as free coinage of silver dollars
ceased in the United States in 1873.
Ricardo was a born Jew. He made
a fortune, for himself, in a short time
on the London stock exchange, and
then commenced to write about mon
ey, currency and banking. Then he
constructed his "Principles of Politi
cal Economy and Taxation."
Soon after the mint of England was
opened for free coinage, financiers be-
SUPEKIOil ME KIT
Remarkable Curative Propsrties of a
Remedy for Indigestion and
Stomach Weakness.
Stuart's Dyspepsia Tablets, a pre
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prevent fermentation, acidity and sour
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Stuart's Dyspepsia Tablets can be
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'per package.
gan to talk about a "double standard."
This was the consequence of free coin
age of gold and silver. If the mint
had not been opened to free coinage
there could not have been any double
standard, or any standard at all, ex
cept the total amount of money it
had been previous to 1666, when the
sovereign coined as much money as he
or she pleased. Elizabeth did as she
pleased with the currency. So did all
the kings and queens previous to and
alter her till the year 1666.
It is a matter of history that free
coinage produced a double standard of
value in England, which meant that
when gold was cheaper than silver (at
a ratio of about one of gold to fifteen
of silver) then gold circulated in pref
erence to silver; and when silver was
cheaper then silver circulated, or had a
tendency to do so.
Now, if we take the statistics of the
production of gold and silver, we can
say which metal circulated and which
does not circulate as money.
From 1660 to 1680 (during which
time the mint was opened for free
coinage) about thirty-six ounces of
silver came from the mines to one of
gold. This was a silver period, the
normal amount being from fifteen to
nineteen of silver for one of gold. The
ratio of production can change either
by an extraordinary supply of silver
(gold remaining the same) or by an
extraordinary supply of "gold (silver
remaining the same).
The period of 1660 to 16S0 is import
ant, partially, because in this time the
mint of England was first opened to
free coinage of gold and silver. This
date (1666) must be kept in mind, be
cause it opened a controversy, that is
not quite closed yet.
Previous to 1666 the value of a coin
(or money) depended upon the num
bers of coins (or money) put into cir
culation; afterwards upon the quan
tity of metal in each coin. We shall
see this later on, in our story, more
distinctly.
About the year 1810 gold began to
be a very scarce article; and, yet,
England, about this time, closed her,
mint to free coinage of silver. It
was done at a wrong time, and dearly
did England pay for the wrong. Much
to the credit of Ricardo, I do not find
that he ever favored the demonetiza
tion of silver. At this time he was
rich and retired from business. He
was looking only for fame and the
good opinion of his countrymen. He
renounced his old Jewish faith about
this time.
There was great scarcity of both
gold and silver from about 1810 to
about 1830. Between 1830 and 1840
there' began to be considerable in
crease. From 1840 to 1850 the two
metals increased still more. Times be
gan to be better. From 1810 to 1830
was a period of revolutions in Eu
rope; a period of hard times, pro
duced largely by a scanty supply of
the precious metals. It was a period
when paper money began to be more
and more used, largely on account of
the scarcity of the precious metals.
From 1850 to I860 was the period of
the greatest supply of gold, before, or
afterwards, till 1890; a period when
the supply of silver was also increas
ing, but nothing like as much as gold.
It was, therefore, a golden period. Only
about four ounces of silver came from
the mines to one of gold. Yet it took
15 ounces of silver, or thereabouts, 1o
equal one ounce of gold in value. Now,
if takes 40 ounces of silver to equal
one of gold in value. What has pro
duced the change? Something has
produced it since about 1876. At that
time silver began to fall in price.
This, they said, was a fall of silver in
value, which was not true. In the old
silver period they never spoke of sil
ver as rising or falling in value. On
the contrary, they always assumed
that silver could not rise or fall.
Now in these days we hear much
talk about silver rising and falling in
price, whereas a hundred years ago
they talked about gold as rising and
falling in price. We, now, seldom hear
anything about gold falling or rising
in value or in price, just as, a hun
dred years ago, they never or seldom
talked about silver rising or falling
in value or price.
Why do they talk so differently?
The truth is that when they take sil
ver as a standard of value and as
sume that it never changes in value or
price then they must talk about gold
as rising and falling in price if not in
value. On the other hand, when they
take gold as the standard of value, and
hereby assume that it never changes
in value or price, they must of neces
sity talk about silver as falling and
rising in price, if not in value.
Why is there a difference between
value and price. Why this difference
of language?
If the law puts a price on gold, as
it did in England in 1666, when the
mint was first opened to free coinage
of gold, then, of course, the price of
gold cannot rise or fall; because its
price is fixed by law. But, although
the price of gold cannot rise or all,
nevertheless the value of gold can rise
and fall. This was found to be the
case in England soon after the mint
was opened to free coinage of gold.
The guinea, for instance, a gold coin,
first struck in 1663, three years before
the mint was opened to free coinage
of gold, began to rise and fall in price
after 1666, although it was a piece of
money and was supposed to have no
price, any more than our gold dollar
is supposed to have a price. We ex
pect our gold dollar to have value;
but we do not expect it to have price.
Our gold dollar being 25 8-10 grains of
gold, standard fine, that is, nine-tenths
fine, we call this our standard unit of
value, and we expect it to be just one,
no more, no less, without any premium
or discount. If this dollar, or so
called unit of value, should begin to
be called 101 cents, then we might be
gin to wonder, because we have been
told that the gold dollar is exactly
one hundred cents, no more, no less;
and cannot be any more or less, with
out something being wrong.
Just so it was with regard to the
guinea soon after 1666 in England. As
! previously stated, guineas had been
i ordered to be coined in 16C3 by Charles
j II.; and were actually coined and in
j circulation by his order, because he
; alone could make the order. There
j was no. free coinage in 1063. No pri
vate owners of gold could, in that
year, take their gold to the mint and
have it made into guineas; but
Charles II. could take his gold to the
mint and have it coined into guineas.
He had the power to do it, because the
law gave him the power. But, thre'j
years afterwards, the cower was t.apn
away from him and all subsequent
monarchs and given to the private
owners of gold; and thenceforth they
alone could take gold to the Enciih
mint and have it coined into-money.
T'n 1063. when guineas were first
coined, they were each rated at 20
shillings, no more, no less; that is, a
pound sterling. It was supposed that
each guinea had just enough gold in it
to make it worth as much silver as
there was in twentv silver shillines
(about 4 ounces). Consequently the
guineas commenced to pass, each as 20
shillings, until 1666, when the new law
was made, allowing free coinage of
guineas, at which time it began to be
observed that, although the guineas
were each made for 20 shillings, yet
they passed for more than 20 shillines.
This surprised the observers as much
as we would be surprised, now, to see
our gold dollars quoted in the market
at 101 cents each. The guineas were
quoted at 21s 6d, sometimes more,
sometimes less. It was a new thing
in the history of the world, in Eng
land especially; and the philosonhers,
financiers and all the great men of the
kingdom were called upon to occount
for it. Finally they concluded that
there was too much gold in the guinea,
and so, under the advice of Sir Isaac
Newton, they reduced the amount, just
as we reduced the nmount of cold in
our gold dollar in 1834. Rut this did
not. make the guinea, eemal to 20 shill
ings, except in paving debts. As mer
chandise the guinea was worth more
(or less) thn 20 silver shillines, or 4
ounces of silver. It was the working
of the double standard, which had
been produced by openins the great
j mint to free coinage of both gold and
silver. The monetary unit of England
was still, as it had been, the pound
sterling. This corresponded and still
corresponds to our dollar as a mone
tary unit, except that the English
monetary unit was about five times as
much as ours, from the standpoint of
value.
In England there has never been a
coin by the name of pound sterling,
while in this country, we have had a
silver coin by the name of dollar and
a gold coin by the name of dollar, al
though we have not actually coined
many gold dollars. We have also had
gold coins that were and are multi
ples of a dollar.
In England they represented a
pound sterling by a gold coin called a
guinea, until 1816, when they discon
tinued coinage of guineas and substi
tuted sovereigns. They also repre
sented a pound sterling by 20 shilling
pieces, which contained about 4 ounces
of silver. They tried to make the
gold in the guinea equal to the silver
in 20 shilling pieces, but they never
could quite succeed. The guinea was
worth a little more or less than the
silver in 20 shillings, and so they had
what they called a double standard of
A VILLAGE WOMDEfl
THE HAMLET OF BIG SPRINGS,
WIS., HAS A SENSATION
Agitation Overtho Story of a Woman Who
Wanted to Dio-Hor Condition Due
to Soriont III Health
Big Spring, Adams, county, Wiscon
sin, is much the same as other coun
try villages where every resident's af
fairs are pretty well known to every
body else. It . was no secret, there
fore, that Mrs. Jennette Wilber led an
unhappy life and had wished for death
as a relief from her suffering. "For
twenty-five years I was tortured with,
indigestion," she says, "but now I am
well, thanks to Dr. Williams' Pink
Pills, and I have told all my friends
of the almost miraculous way in
which I was cured.
"Everyone in the village knows of
my long sickness. After each meal,
gas would form in my stomach and
cause me great distress. So great was
my suffering that I thought many
times it would be a relief to die. Of
course I was treated by the best doc
tors in our section, but the Ivelp they
give me was only temporary. I was
very careful of my diet but as I be
came worse I had difficulty in retain
ing the simplest food, in fact, the
smell of food often nauseated me. One
day I saw Dr. Williams' Pink Pills for
Pale People mentioned in a newspa
per and, .although I had tried many
medicines without being benefited, I
decided to try them. I knew that my
case, being of long standing, could not
; be cured in a day and I gave the pill3
a thorough trial. I began to improve
slowly after taking the first box and
in a few months I was entirely free
from indigestion and could eat any
thing I wanted. Since that time I
have been troubled but once when I
became run down from overwork. I
resorted to Dr. Williams' Pink Pills
again and was soon entirely well."
Anyone having indigestion or dys
pepsia can be cured if Dr. Williams'
Pink "Pills for Pale People are given
a sufficient trial. These pills act, not
on the symptoms, but on the cause of
diseases arising from impoverished
blood or shattered nerves. They cure
partial paralysis, locomotor ataxia, St.
Vitus' dance, sciatica, neuralgia, nerv
ous headache, after-effects of the grip,
palpitation of the heart, pale and sal
low complexions and all forms of
weakness. At all druggists, or direct
from Dr. Williams Medicine Co.,
Schenectady, N. Y., fifty cents per box,
six boxes for two dollars and a half.
HEADACHE"
At all drug gtort. 25 Door 25c. J
value. It puzzled almost everybody,
and nobody could explain it, until Iti
cardo came along and said, that there
were two standards, because the debt
or classes including the great Rank
of England wanted to pay their debts
with the cheaper money, while the
creditor classes wanted the debts paid
with the dearer money. There were
really two kinds of money, because
one kind had one value and the other
kind another value, that is, a gold
pound sterling was different from a
silver pound sterling.
I have said, that, previous to 1666,
the value of coins depended, not upon
the quantity of metal in the coin, so
much, as upon the number of coins
put into circulation. In other words,
the value of money depended upon the
quantity of money, as it always should,
and not upon the value of the mater
ial (gold or silver) in the money.
This was shown by the circulation of
the guinea, which always circulated
as 20 shillings previous to 1666, but
would not circulate as 20 shillings af
ter 1666. Here is proof, that, where
there is no free coinage, the value of
money depends upon its numbers or
quantity, but that, under free coinage,
the value of money depends upon the
value of the metal upon which the
money is made, rather than upon the
numbers of money. We have seen
how, when gold money is cheaper than
silver money (under free coinage) the
former will drive the latter out of cir
culation or at least that there is a con
stant tendency in that direction; and
when silver money is cheaper than
gold money, then silver drives out
gold.
I stated that, when, gold has a price
fixed by law, as it always has, under
free coinage of gold, the nrice cantiot
rise or fall. This is strictly true, if
we keep in mind that we are talking
about the "legal" price of gold, as
contradistinguished from its market
price.
This is well illustrated by the his
tory of English currency since 1666.
We must be-vr in mind that when the
mint of England was opened to free
coinage of gold it was opened to free
coinage of silver at the same time. No
new coins were created, b"t all the
old coins, whether gold or silver, were