i -
"the Conservative
the precious stones ; the early Egyptians
made use of seeds called carats , which
were obtained from a certain kind of
plant and adapted to the purpose be
cause of their general uniformity. As
civilization advanced and industries
grew more numerous and commercial
dealings became more diversified , the
inconvenience of weighing the metals
every time an exchange was made , and
the difficulty of assaying and determin
ing their genuineness by the people , led
to the putting of a public stamp upon
certain quantities of the metals to repre
sent a certain value. Silver seems to
have been the first of the metals so
stamped , if we accept the conclusion of
writers who have made a study of
numismatic matters , by a Grecian king ,
Pheidon of Argos , B. 0. 869. To Lydia ,
an ancient kingdom of Asia Minor , is
credited the distinction of having been
the first to coin gold , at a date subse
quent to that when silver was first
coined.
When two persons come together with
articles to exchange by barter , the ques
tion arises as to
The Exchange of , ,
Commodities. how much of one
for how much of
the other. If it were tea and coffee that
were to be exchanged , and it was found
that it took two pounds of coffee to buy
one pound of tea , there would still be
the question of how much sugar it took
to buy either or both of the others , or
how much flour for a certain amount of
any or all of the others , and so on
through the long list of articles that are
of an exchangeable nature. But such
inconvenience is avoided when some
particular commodity is used , and when
it is known that a certain quantity of
some article , say 12 grains of gold , will
buy a certain quantity of tea , say one
pound , and that the same amount of
gold will buy two pounds of coffee , or
ten pounds of sugar , or twelve pounds
of flour , the rate of exchange between
these articles is readily known. And
similarly of all things , the amount of
which we know the certain amount of
gold will exchange for. In this way , by
estimating the value of ail things in
that of the particular thing as the unit ,
money performs the added function of a
measure of value.
When a person makes a time contract
to be settled at a future date , it is of the
utmost importance
Unfluctuating
Currency. that the m0uev
paid in settle
ment shall have as much value
as when the contract was made. Heiioo
money also serves as a standard of value
for deferred payments , to a better
understanding of which it will .be
necessary to briefly consider what is
value. The eminent English writer ,
John Stuart Mill , in his work on "politi-
oal economy- gives the general under-
stand'ng ' of writers as to value in
the following definition : MThe word
value,1 when used without adjunct ,
always means in political economy ,
value in exchange. "
The origin of value to a thing may be
accepted as the desire of persons to
possess it. To gratify the desire to
possess a thing , people are led to offer
other things in exchange for it. The
rate at which the things exchange for
each other represents the value of each ,
one with reference to the other. This
serves to show that exchangeability is
necessary to a thing in order to express
its value. "And what does exchange
ability depend upon ? " says H. D. Mac-
lead , in his Elements of Economics.
"If I offer something for sale , what is
necessary in order that it should be
sold ? Simply that some one else should
desire or demand it. * * * The sole
origin , source and cause of value is
human desire ; when there is a demand
for things they have value ; when the
demand increases the value increases ;
when the demand decreases the value
decreases ; and when the demand
altogether ceases , the value is altogether
gone. "
It may be said in brief that anything
that is bought and sold possesses value ,
and the extent of its value is determined
by what it will exchange for in some
other thing , which is what is meant by
value in exchange , and is made easy to
understand by Prof. E. Laurence
Laughliu in the following illustration :
"The value of an ox , estimated m sheep ,
is the number of sheep for which the ox
will exchange. If one ox exchanges for
twenty sheep , an ox is twenty times as
valuable as one. sheep , or a sheep is one-
twentieth as valuable as an ox. " It is
therefore well to remember that , as has
been so well stated by Samuel Bailey in
his dissertation on the nature of value :
"The value of a commodity must bo its
value in something , and whenever the
term is used with any definite meaning
that something may be assigned. "
So that anything that possesses value ,
a valuable , has the quality of measuring
the value of
any
Itutio. , . . , ,
other valuable.
And when we speak of the value of any
thing we always mean its exchangeable
value , that is , its estimate in some other
thing of an exchangeable nature. The
rate of exchange between the two would
be their value in exchange , and is what
we are familiar with in monetary dis
cussions as the ratio of exchange. If
the ratio between gold and silver is , say ,
20 to 1 , it means that it takes twenty
ounces of silver to buy one ounce of
gold , and that therefore gold is twenty
times as valuable as silver , weight for
weight , or that silver is one-twentieth
as valuable as gold , weight for weight.
Value then being something that is
measured , and anything that possesses
value a valuable being capable of
measuring the value of any other valu
able , money being itself a valuable that
everybody uses to make exchanges with ,
serves as a , < common measure of value ,
and the value it has measured it trans
fers in its capacity as a medium , of ex
change. It does this by what we term
the dollar , the unit and standard of
value , which at present consists of 25.8
grains of gold .900 fine , or 213.22 grains
of pure gold.
But paper and silver dollars have been
found more convenient and desirable to
the great mass of the people than the
gold to make exchanges with , and are
issued in different forms to a great ex
tent instead , the government conferring
upon each form , such qualities as to give
it circulation. Thus are United States
notes legal tender for all debts , public
and private , except duties on imports
and interest on the public debt. Silver
dollars are legal tender for all public
and private debts , except where other
wise expressly stipulated in the contract.
Treasury notes , act of 1S90 , are legal
tender for all debts public and private ,
except where otherwise expressly stipu
lated in the contract. Subsidiary silver ,
half and quarter dollars and dimes , are
legal tender to the extent of ten dollars.
The minor coins of nickel and bronze
are legal tender to the extent of 25 cents.
Gold and silver certificates , not being
legal tenders , are receivable for all
public debts without exception.
National bank notes , while not legal
tenders , are receivable for all public
debts except duties on imports , and are
redeemable by the treasury or issuing _
bank. These are called representative
or credit money , and the government
keeps them at a parity with the gold by
limiting their issue , so that their total
amount shall not be in excess of the
amount that is needed by the country
for doing business on gold values.
The United States treasury depart
ment issues a circular ( No. 14U ) giving
information con-
United States . , , . . . . .
Currency. OOriUUg the dlfter-
ont kinds of cur
rency issued by the government , and
from it the most of what follows has
been obtained.
The issue of United States notes is
limited to the amount ( $340,081,010) ) that
were outstanding May JJ1 , 1878 , when
nn act was passed requiring that they
be reissued when redeemed. They were
first authorized by the act of February
25 , 1803 , when they wore commonly
called "greenbacks. "
The silver dollars now in use are
largely by the act of February 28 , 1878 ,
known as the Bland-Allison act , which
directed the secretary of the treasury to
purchase silver bullion at the market
price to an amount not loss than two
nor more than four million dollars worth
per month , to bo coined into silver dollars
lars as fast as purchased. The amount
coined up to Juno 80 , 1898 , including
about 8 ! ) million dollars since the not of
1890 , was about 401 million dollars , of
which about 57 million dollars were
then in oiroulation , the remainder being
held in the treasury against which silver
i :
v t
