Since for thousands of years the world recognized both silver and gold
as money, can anybody tell what has happened to render one of them
unfitted for the money use?
No argument based on fluctuations in the current supplies of either of
the metals can militate against the use of both as money. The
fluctuation in the annual yield of both, taken together, is much less
violent and less frequent than the fluctuation of either taken
separately. By the use of both, society has much greater security
against the evil of an insufficient money volume. While a large yield,
now of one, and again of the other, has taken place, there is no
instance in the history of the world of an extraordinary yield of both
occurring simultaneously, except in the single instance of the first
discovery of the mines of America. When the gold mines have been
yielding largely, there has been no special increase of silver, and
during the period when silver has been produced in comparatively large
quantities the gold mines have been less productive.
This will be illustrated by the following table showing the yield of
both gold and silver, from the discovery of America to the present time.
_Annual average production of the precious metals throughout the
world from the discovery of America to 1872._
[From Director of United States Mint.]
-----------------------------------+-------------+--------------
Periods. | Gold. | Silver.
-----------------------------------+-------------+--------------
1493-1520, average for each year | $3,855,000 | $1,953,000
1521-1544 do | 4,759,000 | 3,749,000
1545-1560 do | 5,657,000 | 12,950,000
1561-1580 do | 4,546,000 | 12,447,000
1581-1600 do | 4,905,000 | 17,409,000
1601-1620 do | 5,662,000 | 17,538,000
1621-1640 do | 5,516,000 | 16,358,000
1641-1660 do | 5,829,000 | 15,223,000
1661-1680 do | 6,154,000 | 14,006,000
1681-1700 do | 7,154,000 | 14,209,000
1701-1720, average for each year | 8,520,000 | 14,779,000
1721-1740 do | 12,681,000 | 17,921,000
1741-1760 do | 16,356,000 | 22,158,000
1761-1780 do | 13,761,000 | 27,128,000
1781-1800 do | 11,823,000 | 36,534,000
1801-1810 do | 11,815,000 | 37,161,000
1811-1820 do | 7,606,000 | 22,474,000
1821-1830 do | 9,448,000 | 19,141,000
1831-1840 do | 13,484,000 | 24,788,000
1841-1850 do | 36,393,000 | 32,434,000
1851-1855 do | 131,268,000 | 36,827,000
1856-1860 do | 136,946,000 | 37,611,000
1861-1865 do | 131,728,000 | 45,764,000
1866-1870 do | 127,537,000 | 55,652,000
1871-1872 do | 113,431,000 | 81,849,000
-----------------------------------+-------------+--------------
_World's production of gold and silver for the calendar years
1873 to 1889, inclusive._
----------+---------------+-------------------------------------------
| Gold. | Silver.
Calendar +---------------+--------------+--------------+-------------
years. | | Fine | Market | Coining
| Value. | ounces. | value. | value.
----------+---------------+--------------+--------------+-------------
1873 | $96,200,000 | 63,267,000 | $82,120,000 | $81,800,000
1874 | 90,750,000 | 55,300,000 | 70,673,000 | 71,500,000
1875 | 97,500,000 | 62,263,000 | 77,578,000 | 80,500,000
1876 | 103,700 000 | 67,753,000 | 78,322,000 | 87,600,000
1877 | 114,000,000 | 62,648,000 | 75,240,000 | 81,000,000
1878 | 119,000,000 | 73,476,000 | 84,644,000 | 95,000,000
1879 | 109,000,000 | 74,250,000 | 83,383,000 | 96,000,000
1880 | 106,500,000 | 74,791,000 | 85,636,000 | 96,700,000
1881 | 103,000,000 | 78,890,000 | 89,777,000 | 102,000,000
1882 | 102,000,000 | 86,470,000 | 98,230,000 | 111,800,000
1883 | 95,400,000 | 89,177,000 | 98,986,000 | 115,300,000
1884 | 101,700,000 | 81,597,000 | 90,817,000 | 105,500,000
1885 | 108,400,000 | 91,652,000 | 97,564,000 | 118,500,000
1886 | 106,000,000 | 93,276,000 | 92,772,000 | 120,600,000
1887 | 105,300,000 | 96,189,000 | 94,265,000 | 124,366,000
1888 | 109,900,000 | 109,911,000 | 103,316,000 | 142,107,000
1889 | 118,800,000 | 125,830,000 | 117,651,000 | 162,690,000
----------+---------------+--------------+--------------+-------------
From this table it will be seen that from 1801 to 1820 the average
yearly yield of gold was $9,710,500; of silver, $36,847,500--four of
silver to one of gold.
From 1821 to 1840 the average yearly yield of gold was $11,466,000; of
silver, $21,964,000--two of silver to one of gold.
From 1841 to 1860 the average yearly yield of gold was $85,150,000; of
silver, $34,826,500--two and a half of gold to one of silver.
From 1861 to 1880 the yearly average yield of gold was $117,991,850; of
silver, $68,043,900--nearly two of gold for one of silver.
From 1881 to 1889 the yearly average yield of gold was $105,500,000: of
silver, $122,540,388--one-sixth more silver than gold.
From those figures it is plain that no continuous, extraordinary yield
of silver, such as might warrant the slightest fear of an unnecessary
addition to the money volume, is to be expected. On the other hand the
continuous drain of gold for use in the arts, as dentistry, gold plate,
jewelry, gilding, and articles of decoration generally, is seriously
encroaching upon the annual supply.
Both metals possess in common, and neither in any different degree from
the other, all the qualities which are recognized as necessary in a
commodity money. Silver enjoys in an equal degree with gold the quality
of indestructibility, of divisibility, of malleability, and of
resistance to chemical changes. The stock of both existing in the world
(the product of all time) is estimated to be about equal, the production
of the past 500 years being set down as--
Gold $7,240,000,000
Silver 7,435,000,000
That silver mining has not proved exceptionally profitable in this
country is proved by the comparatively small number that have engaged in
the business. This country has been thoroughly explored in the search
for additional mines without any of great value being discovered. The
allurements of the business lie in its uncertainty; and for the
occasional prize that is drawn thousands of blanks are found. There is
always enough hope of results to induce continued effort, but there is
also sufficient doubt and discouragement to deter an undue number from
engaging in the business.
The mines of Mexico have been worked for hundreds of years; and up to
1873 the business of silver mining in that country had all the stimulus
that a parity at 15-1/2 to 1 could give to it. It is not, therefore,
probable that any material increase of output can be expected from that
quarter.
Conceding, for the sake of the argument, the eventual possibility of so
superabundant a yield of silver as to work injury and inequity to the
interests of creditors, is it not manifest that it is in the power of
society at all times to remedy the evil by a limitation of the coinage?
And on the other hand, is it not equally manifest that for an
insufficient supply there is no remedy?
If great mountains of silver should be discovered, does not Congress
meet constantly? If there should seem to be too much, could not the
coinage be readily limited to prevent depreciation? But, on the other
hand, when we dedicate the monetary function solely to one metal, of
which there is manifestly and admittedly the world over an insufficient
supply, where is the remedy? What can Congress do to enlarge that
supply? Absolutely nothing.