THE ECONOMIC DISTURBANCES SINCE 181 S. 5 



1886, nevertheless claim that consumption has at the same time in- 

 creased to such an extent, that the general assumption of an excessive 

 production of this commodity has not been warranted, and in truth 

 has " but slightly exceeded the ordinary growth of population, and 

 that, therefore, other influences must have been at work to cause the 

 great decline in its price which has characterized the course of events 

 during recent years." But to this it may be replied, that when the 

 supply of any commodity exceeds by even a very small percentage 

 what is required to meet every demand for current consumption — 

 specially in the case of a staple commodity like wool, whose every 

 variation in supply and demand is studied every day, as it were 

 microscopically, by thousands of interested dealers and consumers — it 

 is the price which this surplus will command that governs and fixes 

 the price for the whole ; and as this can not be sold readily — as under 

 such circumstances no one buys in excess of present demand, and all 

 desire to dispose of accumulated stocks — the result is a decline of 

 prices, in accordance with no law, and which will be more or less ex- 

 cessive, or permanent, as opinions vary as to the extent of the surplus 

 and the permanence of the causes that have occasioned it.* 



Another illustration to the same effect is afforded in the case of 

 silk, which, according to accepted English statistics, has notably de- 

 clined in price, comparing the average rates of 1867-'77 with those 

 of 1885, without anything like a corresponding increase in supply. 

 Hence the inference would seem warranted, that some other agency 

 than increased and cheapened production had occasioned the decline 

 in price, and that the case was one which affords support to the gold- 

 scarcity theory. But a careful examination of all the involved cir- 

 cumstances discloses the fact, that within recent years materials other 

 than silk — more especially the "ramie" -fiber — largely enter into the 

 composition of silk fabrications — in the case of the cheaper silks of 

 extensive consumption to the extent of even 60 per cent — and that 

 other methods of adulterating silk, formerly but little known, are now 

 extensively practiced ; all of which is equivalent to increasing the 

 supply of silk for manufacturing, far beyond what commercial reports 

 respecting the supply of the fiber would indicate. 



Such, then, are the leading and admitted facts illustrative of the 

 nature and extent of the extraordinary and most extensive decline in 

 prices which has occurred in recent years, and which has been the 

 most apparent and proximate (but not the ultimate) cause of the 

 period of economic disturbance which, commencing in 1873, still ex- 

 ists, and seems certain to last for some time longer. Such, also, is a 



* The estimates of Messrs. Helmuth, Swartze & Co., were that the wool product of 

 the world increased from 1871-'75 to 18S6 — or during a period of from eleven to fifteen 

 years — 35 per cent ; while the increase in the world's consumption of wool from 1860 to 

 1886 — a period of twenty-five years — was from 2'03 pounds to 2*66 pounds per head, or 

 in the ratio of 30 per cent. 



