CURRENCY. 



237 



gold about $139,000,000) ; 1866-'72, about 3 of 

 gold to 2 of silver. For 10 years before the 

 passage of the German law of 1871 the world's 

 production of silver averaged about $50,000,000 

 per annum ; since that date it has averaged 

 about $68,500,000, and the production of gold 

 for the latter period about $95,000,000. For 

 24 years the total production of the two metals 

 together has amounted, almost year for year, 

 to the sum of $165,000,000, according to the 

 valuation 1 : 15. 



The Director of the Mint, in his report for 

 1876, gives an account of the history of the 

 silver dollar in the United States. A resolu- 

 tion of Congress of July 6, 1785, established 

 the dollar as the money unit of the United 

 States. A resolution of August 8, 1786, fixed 

 the weight of the dollar at 375.64 grains of fine 

 silver, and provided for the coinage of ten and 

 five dollar gold pieces, the former to contain 

 246.268 grains of fine gold. The act of April 

 20, 1792, fixed the relative value of the two 

 metals at 1 : 15, and provided for the coinage 

 of " dollars or units, each to be of the value of 

 a Spanish milled dollar, as the same is now 

 current, and to contain 371-^ grains of pure, 

 or 416 grains of standard, silver." An act of 

 January 18, 1837, changed the alloy, making 

 T 9 U of pure metal the standard for both silver 

 and gold; the value of the silver dollar was 

 not changed, and its weight was consequently 

 altered to 412J grains. The Spanish dollar, 

 current in 1792, when of full weight, contained 

 374| grains of pure silver, and by the relative 

 valuation of 1:15 gold was undervalued ; the 

 consequence was that gold coins could not be 

 kept in circulation, but were melted down or 

 exported soon after leaving the mint. After a 

 fifteen years' discussion of this question, an act 

 was passed in 1834 reducing the weight of the 

 gold dollar, thus increasing the coining capaci- 

 ty of gold 6,681 per cent. The silver dollar 

 ceased to be coined in 1804, before which date 

 only 1,439,517 pieces had been struck, and was 

 first coined again in 1837, and after that but 

 very sparingly ; the fractional coins, however, 

 were made of full weight. After the reduction 

 in weight of the gold dollar, the silver curren- 

 cy exhibited the same behavior that had been 

 remedied in the case of the gold coin ; it was 

 now valued lower in relation to gold than in 

 France and other countries of the double stand- 

 ard, and, consequently, was melted and ex- 

 ported to an extent which left the country in 

 want of small money, in spite of the constant 

 activity of the mint. This condition lasted 

 until, on February 21, 1853, an act was passed 

 demonetizing the fractional silver currency; 

 reducing the weight of the half-dollar, quarter- 

 dollar, dime, and half-dime 7.4 per cent., and 

 limiting their legal-tender character to pay- 

 ments of $5.00. The act of 1792 was never 

 abrogated until, in 1873, the bill was passed 

 which established the single gold standard. 

 Since 1834, however, gold has been practically 

 the metallic currency of the country, and by 



an act of March 3, 1849, the gold dollar (= 25.8 

 grains of standard fineness) was declared to be 

 the money unit, or representative of the dollar 

 of account. Previous to the law of 1873 the 

 silver dollar had actually three separate values : 

 legally it was a dollar of 100 cents; but its 

 mint-price was (in 1861) 103.98 cents, which 

 was its commercial value expressed in gold 

 currency, while in subsidiary silver currency it 

 was worth 107f cents, and was paid out at 

 the mint in single pieces for $1.08. 



The annual convention of the American 

 Bankers' Association was held in New York 

 on the 12th, 13th, and 14th of September. 

 The main questions discussed were the double 

 currency standard, and the cooperation of the 

 national banks with the Treasury in the re- 

 introduction of metallic currency, and the sub- 

 ject of the relief of banking capital from tax- 

 ation. 



Mr. George S. Coe, president of the New 

 York Clearing-House, presented a plan for the 

 resumption of specie payments by the assist- 

 ance of the banks, to the effect that national 

 bonds for redemption purposes, to the amount 

 of $50,000,000 or more, should be purchased by 

 the banks, at par in gold, minus % per cent for 

 expenses, with the privilege of taking more 

 bonds if found necessary, these bonds, being 

 coupon or registered and of all denominations, 

 to be offered for sale at par by the banks and 

 the United States Treasury ; the collateral se- 

 curity to be deposited in the treasury of the 

 banks, for the purchase of the gold bonds, to 

 consist of gold coin, or United States bonds, or 

 Treasury notes at their market value, to be held 

 as a special deposit. The sale of the bonds 

 would enable the banks to accumulate a coin 

 reserve, and the privilege of exchanging col- 

 laterals would allow them to reissue legal-tend- 

 er notes when the money market demanded 

 them. This plan would allow the accumu- 

 lated volume of coin to circulate in the internal 

 commerce of the country, and, in the natural 

 course of things, to supplant the legal-tender 

 notes, and thus obviate the difficulties attend- 

 ing the plan of resumption by the accumulation 

 of an idle reserve store of gold in the Treasury. 



W. 8. Groesbeck, of Cincinnati, denied that 

 there was an excessive production of silver, 

 since, from a statistical account, it appears that 

 the aggregate production of gold in the world, 

 from 1852 to 1875, has been $2,913,000,000, or 

 an average of $121,000,000, while the world's 

 production of silver during the same period has 

 been $1,187,000,000, giving a yearly average 

 of only $49,000,000. The United States' part 

 in the production of the precious metals, from 

 1845 to 1875, amounted to $1,323,786,769 in 

 gold, giving a yearly average of $42,700,000, 

 and $253,000,000 in silver, averaging $8,100,000 

 a year. 



Prof. A. L. Perry, of Williams College, pre- 

 sented the other side of the question, adducing 

 historical proofs of the impossibility of pre- 

 serving a double standard, and affirming the 



