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gold and silver should be as 1 of gold to 15% of silver, was the result of nearly two hundred years' observation of the following facts, viz., that the intrinsic value of each metal as a commodity, aside from its uses as currency or money, was continually fluctuating in accordance with the increase or decrease of its production, but that this increase or decrease of production, and consequent increase or decrease of value, was never the same in both metals at the same time. The experience was that when the production of gold had diminished, that of silver had either remained stationary or increased, and vice versa. There was no theory to show that this should necessarily be the case, but such was and had been the fact for over two hundred years. In order to prevent wide fluctuations in the standard of values, it was sought to establish a bond between the values of the two metals, so that the diminishing value of the one might be checked by either the stationary or the increasing value of the other. Experience had shown that the average commercial value of silver had been as 153 of silver to 1 of gold, and that though either one might temporarily change in value so as to change this relative value, it would certainly come back to it sooner or later if both metals were equally used as money. As previously remarked, the values of both metals is to a very large extent fictitious; there is no other

that would warrant more than one-fourth the present values of either gold or silver. The depreciation of 29 in the 100 of the value of silver (or the increase of 41 per cent in the value of gold, whichever one may choose to call it) which took place from October, 1874, to July, 1876, mainly as the result of the demonetization of silver by Germany, proves it. It was, therefore, to prevent fluctuations in the standard of values that the two metals were, so to speak, "yoked together” by the legal establishment of their values as permanent at 151 to 1. It was believed, and experience has proven, that if both metals were equally used as money, this relative valuation was the point from which there would be the least departure. During the discussions of this subject in Congress (1875–6) there seemed to be a disposition on the part even of the advocates of the double standard to change the relative legal values of gold and silver by the coinage of a larger silver "dollar," as compared with the gold “dollar.” But any departure from the standard of 154 to 1 is the same in principle — only less in degree complete demonetization of either of the metals.* To meddle once with a rule established by the experience of centuries, only makes the necessity of meddling again at some future time.

use, than as money,

The following table is from the annual report for 1875 of the United States Commissioner of Mining Statistics :

as the

* The law of April, 1792, provided that the ratio of gold to silver in all coins current as money in the United States “shall be as “fifleen to one,” and for 40 years the silver dollar of the United States was of that proportional value. But by the reduction in weight of the gold coins the ratio was increased to 16 to 1. The subsequent laws regulating the values of coins had changed this to 15.988 to 1 in 1837, which continued to be the ratio until the coinage of the trade dollar under the law of February, 1873, made it 16.27 to 1.





A, D.


Apparent relation of market-valuc, as deduced from the
British mint-regulations, some absurd and unsuccessful

experiments in coinage being disregarded.
French mint-regulations.
German imperial mint-regulations.

1513 1561 1575 1551 1559 1604 1612 1619 1623 1640 1665 1667 1669 1070 1679

1680 1687-1700 1701-1720 1721-1740 1741-1790 1791-1900 1801-1810 1811-1820 1821-1830 1831-1810 1841-1850

11.30 11.10 11.70 11.68 11.17 11.44 12.10 13.30 13.35 11 74 13.51 15.10 14.15 15.11 14.50 15.00 15.40 14.97 15.21 15.08 14.74 15.42 15.61 15 51 15.80 15 67 15.83

1851 1852 1853 1854 1855 1856 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1869 1969 1870 1871 1872 1873 1874

15.46 15.57 15.33 15.33 15.36 15.33 15.27 15.36 15.21 15.30 15.47 15.36 15.38 15.40 15.33 15.44 15.57 15.60 15.60 15.60 15.59 15.63 15.90 16.15

British mint-regulations -- experiments disregarded.
Upper German regulations.
French mint-regulations.
Upper German regulations.
British regulations.
French regulations.
Ratios calculated from the bi-weekly quotations of the

Hamburg prices-current, giving the value of the gold
ducats of Holland in silver thalers, down to 1771, and.
after that, in fine silver bars. The nominal par of ex-
change during this period was 1: 14.80; and the quotalions
show the variations of the market rate in percentage
above or below this. At par, 6 silver marks-bauco were
equivalent to one ducat, 68 20-47 ducats containing one
mark (weight) of fine gold, and 2794 silver marks-banco
containing one mark (weight) of fine silver. Hence,
6X68 20-47-27%=14.80, the par ratio.
The London quotations. These give the price of a given
weight of standard silver in shillings and pence sterling.
Bearing in mind that there is in Great Britain no charge
for coinage, and, hence, that the price referred to varies
exactly as the market value of the metals, we can calcu.
late the ratio as follows: The standard gold is 11 fine,
and its value is fixed at 778. 104d., or 934.5 pence per
ounce troy. Hence the value of an ounce of fine gold is
if of this sum, or 1019.45 pence. The standard silver,
on the other hand, is 3 7 fine; hence an ounce of fine
silver is worth 1.081 times as much as an ounce of standard
silver. If the fixed value of an ounce of fine gold be divided
by 1 081 times the quoted price of an ounce of standard
silver, the quotient is the ratio desired. Thus, if x be

1019.45 94 3 the quoted price per ounce in pence,

1.0813 (very nearly) is the ratio. Briefly, dividing 943 by the price in pence of an ounce of standard silver gives the ratio correctly to the second decimal place. London being the acknowledged center of the commercial world, this ratio determines the relative value of the metals

among civilized nations. The table shows annual averages only. The lowest monthly

value of gold was 15.12 in May, 1859, and the highest 16 35, in October, 1874. The annual average for 1874 here given is calculated upon the prices of eleven months, ending November 30.

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The foregoing table only gives average annual values ; but in order to show the fluctuations caused by the increase of gold from 1848 to 1853–5, and also the much greater ones caused by the demonetization of silver in Germany, I have made the following table, showing the per cent of premium on each of the metals as expressed in the value of the other at various periods :

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In diagram No. 3 I have endeavored to make apparent what has been the progress of the values of the precious metals as compared with the values of commodities, and the principal causes which have at different times affected the values of each, the varying difference between the lines being what is understood as the “ rising or falling of prices.”

The upper line in the diagram - the line of dashes - begins with prices at what might be called “zero” in 1845 to 1847; the rise of the line through 1851–2–3–

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