intercourse, but with such nations as England, France and Germany we should be at great disadvantage. In their dealings with us, they would charge us for the risk they incurred in accepting a less stable money than their own; this charge would be added to the cost of goods imported, and deducted from the price of goods exported by us. It would not only increase the cost of our imports and reduce the price of our exports, but it would also reduce the price at home of all those commodities of which we produce a surplus; our entire products of cotton and of wheat, for example, would be measurably lowered in price. Everybody knows that when the price of wheat goes up or down abroad, it correspondingly rises or falls at home, for the price at home is governed by the price that we can get for the surplus that goes abroad. The risk from fluctuations of our silver money would be as constantly present in all commercial transactions with gold-money countries as is the risk of the sea-carriage, and would have to be insured against in the same manner, with the difference only that in the case of the sea-risk the cost is borne equally by the buyer and the seller, whereas in the case of our fluctuating money the cost would fall entirely upon us.

In order to render to man the highest service of

which it is capable, metallic money must have intrinsic value, stability, and elasticity.

The fundamental requisite of metallic money is that it shall have full intrinsic value. From the beginning of money, through all its forms down to the introduction of paper-money, this rule has governed inflexibly at all times, except when abrogated or interfered with by rulers and law-makers. The term "intrinsic value," as here used, means that a coin contains its full denominational worth of precious metal; in other words, that its nominal and its actual exchangeable values are the same. If coin contains its full complement of precious metal when issued from the mint, and if its free circulation be not thereafter interfered with, it will have intrinsic value, which, combined with freedom of circulation, will give it stability and elasticity.

The stability of coin must rest upon the value of the bullion it contains, as then it will fluctuate only with the fluctuations of the bullion market, which is the highest degree of steadiness it can possibly acquire. It will then gain access to the marts of the world, and this wide range of circuit will enhance its " elasticity," which term is used to express the readiness with which money responds to the demands upon it. The importance of this quality in money will be

treated in more detail when we come to speak of

paper-money.

It is obvious that the larger, broader, and more open the market for any commodity, the more steady will be the price of that commodity. These are marked characteristics of the bullion market; consequently, to give to coin all the elements of efficiency it can possess, it is only necessary to start it into circulation with its full weight and fineness of precious metal, and let it go where it will. Here we have the natural law of metallic money in

all its simplicity;

the complexities are of our own making.

The miner of California in 1849 made his purchases with gold dust, weighing it in scales. It was thus, doubtless, that the metals were measured when they first came into use as money. In coining money for the people, our government performs a very important service; the bullion is minted in convenient forms for handling and for expressing value, thus dispensing with scales and saving time; but the service rendered has a still higher significance. The stamp of the government is a sufficient assurance that the coin contains the required amount of the precious metal: if coining were left to individuals, there would arise doubt on that score that would greatly lessen the efficiency of the money.

If money is to be efficient, there must be no uncertainty as to its quality, for the questioning doubt will limit its usefulness. A sense of security gives mobility to money, and the lack of that sense X cripples it. No intelligent community was ever deceived by debased money; nor has there ever been a community so ignorant that it would not in course of time discover the deception. Emerson has said that not even a tree is so stupid but that if the earth is taken from its roots, it will find it out.

X

Following this line of thought, we perceive that it was the questioning doubt that led to the coinage of metals, for, as the operation of assaying is both difficult and tedious, it would become necessary, in order to facilitate exchanges, that the operation should be performed and verified by an unquestioned authority; and this work the people would naturally require their government to do for them. We know that it was the fineness, not the weight, of the metal that was stamped on the first rude coins, the people weighing them for themselves in making their exchanges. The next improvement in coinage was to stamp the weight on the coins, and these pieces were designated by their weight. The Roman "pondo was a pound of copper, the English "pound" a pound of silver, and the English "penny

pennyweight of silver. Money passed from hand to hand by tale; but when a large sum was to be transferred, it was weighed, because that could be done more easily and accurately. The practice of weighing large amounts of coin still prevails.

The next step in coinage was a step backward. The coinage came to be known as "king's money"; it bore the effigy of the sovereign, and the pieces were more artistically minted; but they were given names that had no reference to their weight or fineness. This irrelevant naming was misleading, and people soon lost sight of money as a commodity, and came to regard the stamp and denomination as its valuable part. The superstitious awe in which kings were then held made it but a short step from the belief that a king's touch would cure disease, to the belief that his effigy and superscription gave value to the coin. By this last change in coin, which obliterated the meaning of money, the people lost control of their coinage,—that control had passed into the hands of the kings. Let us see what they did with it.

It may be stated as an axiom that, down to modern times, kings have been lavish and wasteful in their expenditures, and that, with few exceptions, they have been governed altogether by cupidity in