Page:The Economic Journal Volume 1.djvu/165

 THE FALL IN SILVER, AND THE CLOSING OF THE FRENCH MINT

following Paper arose from a statement printed in the Times of February 1st, 1890, that the fall in the price of Silver was the cause and not the effect of the closing of the French Mint to that metal.

I asserted, and I think I show in this Paper, that it was the effect, and that it could not have been the cause; or, to speak more exactly, that Silver could not have fallen as it did but for the suspension of the law under which, until that time, a fixed and definite price of 6·34554 francs had been given for the ounce standard 2/2 2/4 2/0 fine, just as 77/10½ was and is given here for the ounce of Gold.

A writer in the Times thought, and it will be seen that M. Sudre, of the Paris Mint, expresses the same view, that the fall of the price of Silver having begun from other causes, the closing of the Mint gave it but a slight help on its downward way; but the point on which I insist in these pages is, that the suspension of the law as to the coinage of Silver was a necessary precursor of the fall in price which took place after September, 1873.

There was indeed a fall of price before the suspension of the law, viz., from 60·25d. in April 1872 to 59·75d. in May 1878—that is to say, a gradual decline over a period of 13 months, to the extent of ½d. per ounce. It is true also that apprehension of what would follow if the Mint were to be closed caused the price to fall nearly another ½d. in the ensuing three months; but when the suspension of the Mint law really began the price fell another 1d. by December 30th, and declined pari passu with the further suspension, and both fluctuated violently and fell rapidly when the Mint was finally closed and the barrier which prevented further fall was broken down.