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 84

Mr. Kirk, President of the American Exchange National Bank, was now seen standing up, and stopped to hear the question he was about to put.

"Have not the improved facilities for production," asked Mr. Kirk, "caused a general lowering of prices, and is not this mainly responsible for the gradual decline since 1873?"

replied:

"Improved facilities for production have not been continuous when applied to any one article in the sense of explaining the decline in prices.

"Nearly everything except gold has declined largely in the last two years—the average is about twenty-five per cent—and it may be said that little or no improved facilities have come into use during that time. Demonetization and the collapse of our financial system seems to have paralyzed the hand of even the inventor, and yet values continue to decline.

"Improved facilities as a rule do have a tendency to lower prices, but it is only an incident, and not the cause of the overthrow of our industries.

"When the demand is greater than the supply, prices may advance at the very time that improved facilities for production are in progress.

"Improved facilities for mining gold, both in the placer and quartz mines, are continuously being applied; and yet the value of that metal, in purchasing power, is continuously rising.

"Take the case of wool. There has been no improved facilities for making it grow on the backs of sheep, or of shearing them, in the last twenty years, and yet wool is only about one-third the price it was a few years ago. It, with many other articles that can be put