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160 Money of the world serves as the universal medium of payment, as the universal means of purchasing, and as the universally recognised embodiment of all wealth. Its function as a means of payment in the settling of international balances is its chief one. Hence the watchword of the mercantilists, balance of trade. Gold and silver serve as internationalthat purpose estimated at its price in the London market.—Note to the 4th German edition.—We find ourselves once more in a period of a marked change in the relative values of gold and silver. About 35 years ago the ratio of gold to silver was 15.5 to 1, now it is about 22 to 1, and silver is continually falling against gold. This is essentially a result of a revolution in the processes of production of these two metals. Formerly gold was obtained almost exclusively by washing alluvial strata containing gold, the products of disintegration of gold-carrying rocks. But now this method is no longer sufficient and has been crowded to the rear by the mining of quartz layers containing gold, a method formerly considered as secondary, although well known even to the ancients (Diodorus, III, 12–14). On the other hand, immense new silver deposits were discovered in the American Rocky Mountains, and these as well as the Mexican silver mines opened up by means of railroads, which permitted the influx of modern machinery and fuel and thereby reduced the cost and increased the output of silver mining. But there is a great difference in the way in which both metals occur in the ore beds. The gold is generally solid, but scattered in minute particles through the quartz layers. The whole diggings must therefore be crushed and the gold washed out or extracted by means of quicksilver. Frequently one million grams of quartz do not contain more than 1 to 3 grams of gold, and rarely more than 30 to 60 grams. Silver, on the other hand, is rarely found in the pure state, but it occurs in some ores which are easily separated from the dross and contain as much as 40 to 90% of silver. Or smaller quantities of it are found in ores like copper, lead, etc., which are themselves worth mining. This alone is sufficient to show that the work of producing gold has rather increased, while that of producing silver has certainly decreased, and this quite naturally explains the fall in the value of silver. This fall in value would express itself in a still greater fall of price, if the price of silver were not held up even now by artificial means. The silver deposits of America, however, have been made accessible only to a small extent, and there is, consequently, every prospect of a continued fall in the value of silver. This must be further promoted by the relative decrease of the demand for silver for articles of use and luxury, its displacement by plated wares, aluminum, etc. Judge, then, of the utopianism of the bimetallist illusion that a forced international quotation could raise silver to its old value of 15.5 to 1. The chances are rather that silver will lose more and more of its character as money on the world market. F. E.