CHANGES IN VALUES OF PEE CIO US METALS. 171 



culation — was accordingly called in, and replaced by a new system of 

 gold and silver coinage and paper currency. In this new system, gold 

 was established as the sole monetary standard of the empire, unlimited 

 of necessity in respect to legal-tender powers, while to silver was as- 

 signed the function of subsidiary service ; and for the latter purpose 

 an issue of silver coinage was provided, not to exceed in the aggre- 

 gate 10 marks (12.50) for each inhabitant of the empire (a compara- 

 tively low figure), with its legal-tender value limited to 20 marks 

 ($5). An issue of new paper currency was also authorized, with a 

 prohibition of the use of notes of a less denomination than 100 marks 

 ($25), to be distributed according to population among the various 

 states, and redeemable in the new imperial coinage. A proportion of 

 the old silver coinage, which, having been supplanted by gold, was not 

 needed for recoinage under the new system, was offered for sale in the 

 open market as bullion, and the amount actually sold between 1873 

 and the end of May, 1879, when the sales were suspended, realized 

 $141,784,948. Of this aggregate, §45,644,311 was sold between the 

 years 1873 and 1876, and $96,140,627 between 1877 and 1879 inclusive. 



Concurrently with this action of Germany the bullion price of sil- 

 ver began to decline, and this decline was undoubtedly further pro- 

 moted by the subsequent action of the so-called " Latin Union " — com- 

 prising the four countries of Europe using the franc system, namely, 

 France, Belgium, Italy, and Switzerland — which, fearing lest the sil- 

 ver liberated from use in Germany, and offered for sale, would flow in 

 upon and flood their respective mints, to the entire exclusion of gold 

 if the free coinage of silver was continued ; first restricted (in 1874), 

 and finally (in 1877-78), owing to the continued decline in the value 

 of silver, entirely suspended the coinage of silver five-franc pieces. 

 The coinage of subsidiary silver, or silver of smaller denominations 

 than five francs, was, however, permitted and continued. 



In 1873, also, the Congress of the United States, in revising its coin- 

 age system, dropped from the list of silver coins authorized to be there- 

 after issued from its mint, the silver dollar of 412| grains, although 

 providing for the unlimited issue and coinage of silver in pieces of 

 smaller denominations than the dollar ; and mainly for the reason, that 

 this particular silver coin was not then in circulation in the country, 

 and indeed had not been for a period of more than twenty-five years. 



The extent of the decline in the price of bar-silver per standard 

 ounce, in pence, upon the London market since 1873, is shown by the 

 following exhibit of annual average quotations : 



1873, m\d. IS'/Q, 5\\d. 



1874, 58, V. 1883, 50fc?. 



1875, mid. 1S85, 48T^<f. 



1876, 52|c/. 1886, 45|<f. 



In July, 1836, the price of silver temporarily fell to A2^d. per ounce 

 — the lowest price ever known in history — but reacted in October of 



