884 REPORT—1896. 
should not apply in present case. United States cannot exchange one-ninth of 
total world’s stock of gold for silver without bringing market ratio of precious 
metals below 16 to 1. Probability that the United States will retain large pro- 
portion of her present holding of gold. In that case coinage ratio of 16 to I will be 
effective. Effect on the various currencies of the British Hmpire. Interest of the 
British Empire in stability of ratio between gold and silver money. But sudden 
change will work terrible disturbance, Will affect British Empire more than any 
other. Effect of turning a deaf ear to proposals with respect to international 
agreement. 
Appreciation of gold has been of advantage to certain classes in this country 
although injurious to producing classes. But this class benefit dependent on 
action taken by foreign powers. Settlement of the question an important British 
interest. One for trained political economists, not for popular vote. Should be 
result of calm deliberation and conference between wisest heads of principal 
trading nations. Strength of Republican position the hope that international 
agreement may be brought about. If this hope definitely abandoned free silver 
agitation will become irresistible. 
England’s responsibility. Present British attitude: Gives strength to present 
free silver agitation ; may result in abandonment of any attempt at international 
settlement. But question will be settled. Alternative settlement: Violent 
change as a consequence of a popular vote after appeals to popular passion and 
prejudice. Scant consideration of British interests. Wild revolution instead of 
wise reform. 
2. Standard of Value and Price. By Witu1AM Fow Ler. 
Low Prices Origin of Contest of Standards.—Is it a monetary question? No 
lack of gold or of standard money (state of banks, treasuries, &c.). Standard 
money less and less used in trade. Increased output of gold. 
What ts Price?—The fundamental question. It is the record in money of a 
bargain depending on markets, not on supplies of money. Prices may aflect 
money, not money prices (Giffen). Money a measure and not creator of price. 
Price affected by money supply only in case of alarm. If credit maintained, 
prices not so affected, e.g., dear money and high prices 1864-67. At present time 
cheap money and low prices. (This true, though word money often used in 
different senses.) Supply and demand of goods real source of changes of price. 
Low Prices chiefly due to Excess of Supplies—caused by (1) inventions, cheap 
carriage, cheap production. (2) Increase of capital applied to production by 
(a) limited liability, (4) capital set free by changes in trade (telegrapbs, &c.). 
(ec) Accumulations. (3) Special case of silver—great supplies—lessened demands 
owing to demonetisation caused by great supplies. Fall in prices irregular, but 
if caused by want of gold should act on all alike, e.g., minerals and wheat fallen 
much and meat little. The causes atlecting them must be contrasted. Wages 
have risen though labour is a commodity. Gold depreciated as against labour. 
Allegation that Low Price of Silver affects (a) Prices, (b) Trade.) It 
affects exports from silver-using countries, e.y., imports of wheat from India. 
Russia and Argentine (paper) and U.S A. (gold) now rule our markets as to 
grain. (2) Cheap silver discourages our exports to silver countries (silver prices). 
But our exports to gold countries have fallen in twenty years far more than our 
exports to silver countries (Whitehead). Our real rival in the East as to our 
exports—local manufacture—cheap labour—cheap materials. Discoveries of gold 
may cause speculative demands for goods—Query any recent evidence of this 
affecting prices ? 
Bimetallism. What is it ?—What is a standard? Is a double standard con- 
ceivable ? Objections to change of standard. Bimetallism attempts to create a 
price by law. It says gold worth so many times silver—market or no market. Is 
this possible? ‘Fixed price’ impossible (Giffen), e y., France in 1873—Sherman 
Act of 1890—France before and after 1850—Fall in silver from 1890 to 1898 
(58d. to 38d.). Can legislation secure circulation ? e.g., silver holding of America 
