236 



CURKENOY. 



cause the old mintage-duties have been con- 

 siderably reduced. He believed that, "if a 

 treaty was made establishing everywhere the 

 same relative weight between gold and silver 

 coins, with everywhere a uniform charge for 

 the coinage of the two metals, there would be 

 no more reason for exporting the one than for 

 exporting the other." He testified his belief 

 that if the United States, provided specie pay- 

 ments were resumed, should, in common with 

 the Latin Union, Holland, and possibly India, 

 employ a bi-metallic currency, according to 

 the uniform valuation of 15 : 1 that the action 

 of these nations would be sufficient to arrest 

 all fluctuations in the price of silver, and assure 

 its value for monetary purposes. If the United 

 States should remonetize silver while preserv- 

 ing the old ratio of 16:1, then France would 

 keep her mint closed against silver, and the 

 United States would be the only silver-paying 

 country among the chief commercial nations ; 

 it would drive all the gold out of the country, 

 and fatally hamper America's commerce by 

 leaving her without any par of exchange with 

 Europe ; and, even then, the metal-reserve ne- 

 cessary to redeem the paper currency could 

 not be amassed, since bonds issued for this 

 purpose, which are payable in silver, would 

 not be accepted in Europe. On the other hand, 

 resumption in gold alone would be impossible, 

 as the United States could not derive enough 

 of that metal from the three only stocks in Eu- 

 rope, those of Paris and London, and that of 

 Berlin, which is still accumulating, to redeem 

 the $360,000,000 of greenbacks now outstand- 

 ing. 



The witness attributed the silver crisis of 

 1876 (when bullion was quoted in London as 

 low as 4Qd.) to one essential cause, viz., the 

 German law of December 4, 1871 ; although 

 the legal limitation of silver coinage in the 

 Latin Union which, however, was a conse- 

 quence of the German demonetization as well 

 as the discovery of the Nevada mines, and the 

 diminished exportation of silver to India, doubt- 

 lessly aggravated the situation, they would have 

 had no effect without the German law upon 

 the silver market. The subsequent rise in the 

 price of bullion (quoted 58 pence in the winter 

 of 1876) he traced to the demand created by 

 the importation of silk from China (the Euro- 

 pean crop having failed), and by the purchases 

 of silver for the coming of the $50,000,000 

 American fractional currency voted by Con- 

 gress causes which will soon cease to operate, 

 which will occasion another decline in silver. 

 He did not think that the subsidiary silver 

 coinage maintained in Europe (in Germany 10 

 marks, in France 6 francs per capita,, in Eng- 

 land 20,000,000 nominally) would call for any 

 supply of the metal. He estimated the quan- 

 tity of old silver yet to be disposed of in Ger- 

 many as sufficient to coiff^about 70,000,000 

 trade dollars. 



The uniform legal bi-metallism to be sus- 

 tained by an international agreement, which 



plan he upheld, M. Cernuschi defined as im- 

 plying legal tender in full, and unlimited coin- 

 age, with free importation, and without monop- 

 oly of issue for the Government. He suggested, 

 further, the rating of the cost of mintage ac- 

 cording to value, and not weight, as at present. 



M. Cernuschi suggested a plan for speedy 

 resumption of specie payments, to wit : A pub- 

 lic subscription-loan of 85,000,000 (nominal), 

 perpetual, bearing 4 per cent, interest, payable 

 in London in pounds sterling, and issued under 

 par, to be opened in the money-centres of Eu- 

 rope ; specie payments to be declared for Jan- 

 nary, 1878, the greenbacks being treated after 

 that as coin-certificates ; the mints to be opened 

 at the same date for the coinage, at an even 

 charge of 5 mills per dollar, of the old silver 

 dollar of 412^ grains, -^ fine, and a new gold 

 dollar of 26.61 grains, ^ nne (3 per cent, 

 heavier than the present dollar, and represent- 

 ing the exact relation of 1 : 15 between the 

 metals, pure). 



M. Cernuschi denied that the law of supply 

 and demand operated upon a monetary material 

 the same as upon merchandise. The miners 

 can have all the precious metals which they 

 produce coined into money, and are not affected 

 by competition. If both metals are employed 

 as money, with fixed relative values and full 

 legal tender, the purchasing power of money 

 is less likely to be affected by the variations in 

 the yield of the mines; and if several of the 

 chief mercantile nations employ the double 

 standard, commercial exchange will be pre- 

 served, not only between them, but with and 

 between the countries which cling to mono- 

 metalism. If the United States should con- 

 duct resumption in such a way as to expel gold 

 from the country, then they would stand ex- 

 actly in the same position with a silver cur- 

 rency as now with a paper currency, and all 

 the expenses of redemption and coinage would 

 be thrown away ; for while all Europe employs 

 only gold, exchanges would be no less uncer- 

 tain and expensive than at present. 



The mint-regulations in the different coun- 

 tries of Europe are as follows : France, Bel- 

 gium, Switzerland, Spain, Germany, coin no 

 more silver, but have old silver currency, which 

 circulates as legal tender in full (ratio in these 

 countries 1 : 15) ; Holland, which was silver- 

 mono-metallic from 1840 to 1872, now coins 

 gold gulden according to the ratio 1 : 15.604 ; 

 England and Portugal are gold-paying coun- 

 tries, using silver for tokens only. The paper- 

 paying countries, and the relative valuation of 

 their coinage, if specie payments were resumed, 

 are : Italy, 1 : 15.50 ; Austria, 1 : 15.45 ; Russia, 

 1 : 15.30 ; Turkey (gold-mono-metallic). The 

 history of the relative total production of the 

 two metals has been, in recent times, as fol- 

 lows : At the beginning of this century, when 

 France adopted the 15 : 1 ratio, 3 of silver to 

 1 of gold, or 50 to 1 in weight; about 1849, 

 about equal in value ; 1852-'65, about 3 or 4 

 of gold to 1 of silver in value (annual yield of 



