CHANGES IN VALUES OF PRECIOUS METALS. 173 



acted any tendency then existing to a surplus in the European markets. 

 In 1867 an International Monetary Conference at Paris voted almost 

 unanimously in favor of the adoption of a single gold standard by 

 the chief commercial nations. As far back as 18G0, the late Professor 

 Cairnes, who is recognized as a far-seeing economist, ventured the 

 prediction that silver was in the process of depreciation. Another in- 

 fluence tending to powerfully affect the status of silver in 1873 was 

 due to the circumstance that, subsequent to 1868-'69, the India Council 

 greatly increased the sale of their bills (i. e., drawn on India and pay- 

 able in silver) on the London market, and so virtually increased the 

 stock of marketable silver at that point to the extent of from $20,000,- 

 000 to $30,000,000 annually, in excess of what it had been for the 

 years immediately previous.* 



The German " sales " theory being thus untenable, another hy- 

 pothesis has found wide acceptation — namely, that, notwithstanding 

 any absolute or comparative increase in the supply of silver during 

 recent years, its decline in price and the economic disturbances which 

 are alleged to have followed, would not have occurred, had it not been 

 for the " demonetization " or the general discrediting of this metal for 

 use as money ; which has been contingent on the adoption of gold as 

 the sole monetary standard and as a lai'ger instrumentality of exchange 

 by several of the most important commercial countries — notably Ger- 

 many and the United States ; or, as a leading American statesman has 

 expressed it, "but for the striking down of one half of the world's coin- 

 age," and " compelling gold to do the work of both gold and silver." 

 But here, also, the evidence in confirmation of this hypothesis is ex- 

 ceedingly unsatisfactory or wholly lacking. If by demonetization is 

 meant that there has been less of silver in use and circulation as 

 money, absolutely or comparatively, throughout the world since 1873 

 than formerly; or that the people of any country have been inhibited to 

 their disadvantage in its use ; or that, in consequence of any restrictions 

 on its use for coinage, production and trade have decreased, and the 

 prices of commodities and wages have fallen — the assumptions are 

 not warranted, and the terra demonetization is meaningless. The 

 world's average annual production of silver since 1873 has been greater 

 than ever before. Between 1873 and 1887, inclusive, the aggregate 



* The Government of India is under obligation to pay annually in England certain fixed 

 charges in gold, the same being in the nature of reimbursements — principal or interest 

 — to England for loans on account of public works in India, receipts from railroads be- 

 longing to the British Government, pensions chargeable to India, etc. India being ex- 

 clusively a silver-using country, pays its taxes and railroad freights and fares, etc., ex- 

 clusively in silver ; and in liquidation of its foreign monetary obligations, silver is re- 

 mitted to London in the form of bills (exchange) payable in the silver currency of India, 

 namely, rupees, which are dra^vn by the India Council, or the Government of India resid- 

 ing in London. It must be obvious that to just the amount of such council bills or drafts 

 as are sold in London, to just that same extent the exportation of silver for business pur- 

 poses is supplemented or made unnecessary. 



