Page:Stabilizing the dollar, Fisher, 1920.djvu/303

Rh miner sells an ounce of gold for twenty dollars, of a twentieth of an ounce each, or for forty dollars, of a fortieth of an ounce each. In fact the former is approximately the case in the United States and the latter in Mexico. If the view were correct that a lower price of gold in terms of a heavier dollar were really injurious to the gold miner, why is it, as I have said before, that gold miners do not now sell all of their gold in Mexico instead of in the United States, so as to receive a price twice as high?

Again, it does not matter whether the gold miner receives a high mint price and has to pay dearly for his machinery, labor, supplies, and other costs of operation, or receives a low mint price and can buy his machinery, labor, and supplies more cheaply.

Still again, it does not matter whether the miner makes large money profits while the cost of living is high or small money profits while the cost of living is lower. In fact the former is true in Mexico and the latter in the United States.

In the long run, then, there is no advantage or disadvantage to gold miners from changing the price of gold. This is fundamentally because the price of gold is in terms of gold itself. It ought to be clear that the interests of the gold miner are not concerned with the price of gold in terms of itself! Their interests lie in exchanging their gold for real wealth.

This is well illustrated by recent history. Despite the "fixed price of gold," the war has, none the less, hurt the gold producer by inflating the world's currencies with credit substitutes for gold and so lowering the value of gold, in terms of other things.

Had the dollar been stabilized before the war and been kept stabilized during the war the gold miners would not have been hurt by the war. They have been hurt by inflation—the flooding of the currency with substitutes for their product. Consequently they have asked for relief. They were soon made to see the futility of any relief from raising the price of gold in terms of