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States now share, without reserve, the conviction, more and more extended through the civilized world, that it is impossible to establish a double standard, which must presuppose a fixed relation between the values of the two metals.

M. FOR'I‘AMPs recollected that in the conferences of I865 he had already had occasion to declare that the Belgian government, after having been the partisan of the silver standard, considered, in view of the effects which took place in the monetary circulation of Europe, the standard of gold as the only one that ought to be adopted. M. Fortamps renewed to-day that declaration.

M. MEINECKE would not adopt either the second question, or the fourth, fifth, sixth, or seventh questions. He would vote for the third, that is, for the adoption of the gold standard exclusively; but must add that, for countries which, like Prussia, have the standard of silver exclusively, it would be necessary to prepare the change from one standard to the other by measures of transition. What should they be 1 M. Meinecke, not being furnished with any instructions, does not choose to anticipate them.

The PRESIDENT took note of the very important declaration which has just been made by the delegate from Prussia He added that the eventual fitness of the adoption of measures of transition was provided for in the “ questionnaire."

M. MEINECKE explained that he would fear that if the terms of questions five and six should be ado ted without reserve, certain states could not keep up the double standard. It would there ore be ro er to restrict expressly to the period of transition the time during which the silver stan ar might be maintained simultaneously with the gold standard.

M. WALLENBERG stated the situation and the views of Sweden. Formerly that country had two standards—the ducat in gold, the rix thaler in silver. The value of the ducat was

recisely the equivalent of two rix thalers. As for the rix thaler it was composed of 150% gne silver, and corresponded with the rix thaler of Hamburg. Nine and a quarter rix thalers weighed a pound of Cologne. Each rix thaler was divided into 48 shillings, and the shilling into 12 runstycken. In consequence of the general disturbances at the beginning of the century, gold and silver disappeared, and were replaced by notes of the state bank, having compulsory circulation. When, in l830, the state bank resumed payment in silver, it was wished to base the coin on the weights of the country. One law decided that silver should be coined at 11050 fineness, and that 25 rix thalers should weigh two pound Swedish. It provided at the same time that the ducat should contain 1&3 of fine gold, and that 125 ducats should weigh one pound Swedish. It resulted from the new law that the intrinsic value of the rix thaler became a little higher than before. Formerly the pound of Cologne was equal to 91- rix thalers ; it became only equal to 9% rix thalers. This diflerence, although slight, was not the less prejudicial to Sweden, considering that it has never been observed in the trade with Germany and‘ Denmark. In this respect M. Wallenberg observed that England would take great interest in reducing the sovereign to 25 francs, as has been indicated to the conference, for the pound sterling is given in considerable quantities as the equivalent of 25 francs. Returning to the legislation of Sweden M. Wallenberg added that, from 1847 to 1854, it had been sought to introduce the metric system into the weights and measures of the kingdom, and that this had not been entirely successful in consequence of the resistance of the clerical order and of the agricultural interest ; but the decimal system had been admitted, maintaining at the same time the ancient unities. Thus, as to coins, a law of 1855 had decided that the rix thaler ryxmynt should be coined of [7050 fineness, should

weigh 1%; of the Swedish pound, and should be divided into 200 ores. At the end of eight years, 1863, this reform was accomplished.

In brief, there exist in Sweden two standards without fixed relative values—the rix thaler '

for domestic use and with neighboring countries, the ducat for international money. M. Wallenberg expressed the opinion that monetary unifications could only be established on the basis of the gold standard exclusively, that metal offering the best qualities for circulation; the silver standard should not be reserved except during a time of transition in countries which have it at present, as Sweden as. In the opinion or the Swedish delegate, the unit of international coinage should be a piece of gold of the value of 10 francs, at 39;; fineness,

giving 3l() pieces per kilogram, and represented in its lowest subdivision by the thousandth part, that is to say, the centime. ‘

M. JACOB] would think proper to admit among the measures of transition to be adopted,

that debtors might make their payments in one or the other metal without distinction, at the rate of the day. '

The PRESIDENT replied that this would disavow the legal money, and would reduce the two coinages to the grade of commercial interchanges, which would not be tolerated by the population, especially in France, where they would never consent to receive money the value of which would vary every day.

Mr. VROLrK thought the solution of the difiiculties which are the actual subject of discussion might be found in the examination of the sixth question.

The PRESIDENT proposed a vote on the third question, proposing the adoption of the silver standard exclusivel . The conference decided unanimously in the negative.

The discussion t en opened on the third question, relative to the adoption of the gold standard exclusively.

M. Farm Hsazoe mentioned M. Meinecke’s vote on the second question as being par

ticularly important. Prussia was, in fact, the most important of the states that ‘have the silver standard, and to vote for the adoption of an exclusive gold standard, as the delegate from that country had just done, was a declaration of very significant importance. M. Walleuberg, of Sweden, had voted in the same way. A great difficulty had thus disappeared, and now references can be openly declared for the exclusive gold standard. The monetary system 0 Switzerland was necessarily subordinate to that of the larger. neighboring states, particularly France; yet the minutes of the conference of 1865 showed that, even at that time, all the sympathies of the federal government were for the single gold standard. A similar declaration was also made at the same time by Belgium and Italy. The Swiss government had not altered its opinion since then, and it was now ready to renew the declaretion, though bound by the convention of 1865. Therefore it proposed to decide the .third question afiirmatively. M. Feer Herzog added, that in an assembly composed of wellinstructed men, like the members of this conference, he would not produce the customary

' arguments in favor of a gold standard, but would point out the absolute necessity of adopt

ing the metal that constitutes the mass of the monetary reserve as the general standard.

Baron DE HOCK said he would vote with M. Feer Herzog in the aflirmative on question third. The reason he gave for his opinion was that men of merit have written in favor of the double standard. It was articularly asserted that the system would diminish the monetary crises. in tending to estallilish a sort of equilibrium between the two metals. But it is the sum total of money in circulation that influences the value of things sold, and not the relative proportion of the metals. If the amount in circulation increases, prices fall. With the double standard it is like opium—it is a useful medicine in some cases, yet nobody would use it every day, because it would then become a poison. The double standard might be very useful in financial crises. but it would be very inconvenient in general use, on account of the daily changes in the relative value of the two metals. It exercises an evil influence on the Bourse, for the fall in stocks is always greater in countries where the double standard exists than in those where the single standard prevails. While voting for the single gold standard, M. de Hock admits that in countries where a ditferent system has hitherto prevailed, it might be necessary to continue the double standard, for a specified time, to be determined in advance.

The PRESIDENT remarked that M. Feer Herzog’s and Baron'de Hock’s observations have been very pertinent to the uestion. The situation of the states of the convention of 1865 is not now in question, but t rat of Prussia, Sweden, and the Netherlands, that have the silver standard. Their situation is delicate, and we must attend to them. Should the transition period he of one or many years? If one year was fixed upon, and it was decided that debts should be paid at such a rate after that time, silver would fall and gold rise exorbitantly ; therefore a year would be too short. Perhaps it would be better to leave each state, as M. Vrolik proposes, to decide upon the time when they thought proper to modify their monetary systems, and when they could do it without disturbance, that is, after gold had nearly driven silver out of circulation.

M. MEINECKE thought it would be well to introduce a. reserve in question third, in order to give the silver standard countries the chance of adopting the double standard temporarily, in case of an afiirmative vote for the exclusive gold standard.

The PRESIDENT thought it essential to fix the measures of transition at once, if possible, and agreed with M. Meinecke that it is impossible to pass to the single gold standard without going through the double standard. The same opinion was expressed by Lieutenant General Mansfield, on the subject of the monetary system in India, where the silver standard prevails, which should be supplied by the double standard till the exclusive gold standard could be reached. M. Parieu added, moreover, that the best way to substitute gold for silver in general circulation, would be to fix a certain relation between the two metals, which is the subject of question seven.

M. MEEs proposed to substitute the word temporarily for simullanevusly, in question six.

M. MEINECKE said the words at tins time, in uestion two, caused his reservations.

M. LAVENAY believed the general opinion of t e conference to be already in favor of gold as the only standard. Admitting this, the only remaining difliculty is the transitory measures, and question third might now be decided affirmatively : and adding, “saving arrangements necessary to carry it into efiect.”

M. BROGH thought gold ought to be the only standard, and that the free coinage of silver ought to be prohibited in countries where that standard prevails. In some countries any person can take bar silver to the mint and have it coined at a small cost. Individuals ought

to be deprived of this right; the state alone should have the privilege of coiua e, and ought

to limit the quantity of coin issued to so much per head. This provision oug t to be made now for the tive francs of the convention of 1865. If such a precaution is not taken, and a sudden revolution rendered silver more abundant than gold in Europe, the same difficulties that now exist from the expulsion of silver would then happen inversely. So, private individuals ought only to be allowed to coin their gold. . _The PRESIDENT thought there was an agreement upon the question of a single standarddltferences only existing in regard to the mode of transition; so, to conciliate divergent °P"11°I1$. he proposed the fusion of questions three and six. , . M. MEES, adhering to what he said at the first of the sitting, would not vote for the adoption of question three, nor for the proposed fusion. He considered it inconvenient to adopt the gold standard everywhere, because it would reduce silver to change-money, and consequently gold would rise in value. He thought it not desirable to choose between the two metals at present. Moreover, M. Mess thought a monetary union not very certain to be adopted, and that the labor of the conference, to use a figure of M. Parieu, “is only a seed sown, the germination of which cannot be foreseen.”

The PRESIDENT then pro osedto decide question six in the afiirmative, completing it by limiting the value between t e two metals, as rovided for in question seven.

M. JACOB! thought the question of standard1 not sufliciently investigated. Supposingtwo standards, how long would the fixed relative value between them exist’! The proportion is essentially variable in theory, and there are perpetual changes in the reciprocal value of the two metals. .

The PRESIDENT thought the result of the variations in value of the two metals, when both are circulating, will be to drive out the more precious metal, in certain proportion, equivalent to the change in value. Even when the relation js changed, theoretically speaking, monetary circulation is not so much affected as is supposed, on account of bank deposits and private savings. There is always a certain quantity of specie in every small place, that

only circulates among its inhabitants, and never gets out of a certain circle. Great masses

must be operated upon to. find a profit in the exchange of metals, and the change of metals takes place slowly by successive movements.

For these reasons the general circulation is neither suddenly nor sensibly affected by changes in the relative value_of metals, for France has always had much silver in circulation, even when that metal was largely exported.

M. J ACOBI thought if the gold standard alone were adopted, the silver in banks would be put into circulation, gold would take its place and rise in value. He said there is scarcely any gold in Prussia, and he asked M. Meinecke if the Frederic price of gold is very variable in the Berlin market. _

M. MEINECKE said there are but few gold Frederics in circulation; none have been coined since 1831, except those much worn by use, and since 1857 none have been coined. It has a fixed legal circulation, so that there is no profit in recoining it.

M. VROLIK thought the transition from one system to the other would be slow; that equations and identities would have to be created between the coins; and the right granted to each state to fix the current value of the coins, as is done with the Frederics.

M. FEER HERZOG said that would not be forming a monetary union, but would be main- _

tainin what now exists in Germany in regard to the Napoleon. M. ROLIK thought the Napoleon would be received in banks, and not have a legal circulation;

The PRESIDENT said that would be going back to the double system. He then put question three to the vote.

M. LAVENAY repeated M. Meinecke’s observations tending to a fusion of numbers three and six.

Baron DE HOCK thought the privilege of preserving the double standard for an indefinite time should not be left to any state; question three ought to be settled at once, by fixing a period of transition, as was done with question two.

M. ARTOM proposed to add these words to question three, “with the reservation of transitory measures.”

M. HERMANN insisted that each state shall have the right to adopt any transitory measures it thinks convenient. Y

M. HOCK thought the states should not have the choice of these measures.

M. HERMANN insisting upon his opinion, Count Avila proposed to add these words to question three: “ Leaving each state the liberty of keeping the silver standard temporarily." As gold would drive out silver whenever they circulated together, this amendment should meet with no practical objection, and the temporary maintenance of the silver standard together with gold would not last long from the force of circumstances.

M. KERN would not continue the debate, but must insist on reading the instructions from his government: “ If the question of the gold standard, which was rejected in the conference of 1855, is brought up, the delegates will vote as they were instructed in 1865; that Switzerland prefers the gold standard, but will be governed by the other states signing the convention of 1865.” He added, that he did not know what conclusion France will come come to, which made his situation delicate; but he thought the gold system cannot be adopted immediatel ; a transition period is necessary, and therefore he thought it better to complete question three with these words, “with the reserve of transitory measures/’already proposed by M. Artom, than to adopt the less general proposition of Count Avila.

Count AVILA said, if the conference adopts Mr. Kern’s proposal, he is second it. He is not much interested in the transitory measures now discussed by the conference. As a representative of a country with the exclusive gold standard, he will vote in favor of question three.

The amendment he proposed was to bring the states with a silver standard to an aflirmative vote on question three. In granting the silver standard for a certain time, a general understanding would be arrived at, and a great advance would be made in monetary unifi

cation by accepting gold coins at a le al rate. For the silver standard countries that accepted the double standard would make gel the chief currency thereby, as is now the case in the states that accept the convention of 1865. In fact, in those countries the double standard exists only nominally; silver coins have become the change money, and the five-franc piece, the sole representative of the silver standard. has only a nominal existence. .

The PRESIDENT preferred Count Avila’s proposal to M. Kern’s As transitory measures in silver standard countries are in question, we must not omit the most important of them, the provisional maintenance of the silver standard by the side of the gold standard.

Mr. GRAHAM accepted Count Avila’s amendment, substituting the word transitorily for simultaneously, in the last part of question six, annexed to question three.

Messrs. KERN, HOOK, and ARTOM supported Count d’Avila in this substitution of terms.

After remarking that question six is suppressed, the PRESIDENT put question three, thus modified, to the vote:

“ On the contrary, is this result attainable on the basis and condition of adopting the exclusive gold standard, leaving each state the liberty to keep its silver standard temporarily 1”

The vote was unanimous in the afiirmative, with the exception of the Netherlands.

M. VROLIK, invited by the President, explained that he voted against it because the modification goes beyond question six. where the word transitory is not found in the first draught.

This expression seemed to him to imply a time fixed in advance, and beyond which the silver standard is to give place to the gold standard. He would have voted with the other members of the conference if each state had been left the judge of the time it should keep the double standard. If the states joining Holland come to a mutual understanding, then Holland will be forced to imitate their example. '

The PRESIDENT proposed to continue the discussion of question seven, questions four, five, and six having been solved negatively by the adoption of the aflirmative on question three.

At the suggestion of Baron DE HOCK, the conference decided to-meet-next day, Friday, at 10 a. m., for the continuation of the debate. '

The sitting adjourned at half-past 5. PARIEU,

Vice-President of the Conference. CLAVERY, Secretary. ROUX, Secretary adjunct.

[graphic][merged small][merged small]

M. PARIEU presiding. The sitting opened at 10 o’clock. Present, the delegates of the preceding sitting and Count Moltke Hvitfeldt, .with the exception of Baron Schweizer.

Count MOLTKE said he voted with the majority on questions two and three, which were decided during his absence, with this reserve, however, that he does not pretend to oppose the monetary system of Denmark to that of the neighboring countries with which it has most business.

Baron DE HOOK asked permission to state why he voted for Count Avila’s amendment on the wording of question three, to which he objected at the last sitting.

As decidedly in favor 6f the adoption of the exclusive gold standard, he would not have hesitated to vote for question three as originally drawn up; but modif ing it by M. de’Avila‘s amendment, and then putting it to vote, forced him either to accept a orm he did not approve of, or to vote against the gold standard; therefore he did not hesitate to vote in the affirmative. He laid aside personal preference, so as to put no obstacle to the acceptance of the principle of the exclusive gold standard by states having the silver standard, and determined to regulate the transitory measures for its abolition, as M. Meinecke and M. Hermann say they will. M. de Hock, moreover, thought that if the new wording of article three is defective, the practical consequences will be lessened by special conventions between the states. Stipulations of a nature to limit the action of each government in regard to transitory measures might be introduced, and in discussing question seven the too general meaning of the amendment to question three might be restricted.

The PRESIDENT said the decision at the last sitting would be no impediment to certain transitory measures suggested by the conference, such as fixing a minimum limit to the relations between gold and silver, which is the subject of question seven. .

Viscount VILLA-MAJOR thought, before examining this question, it would be better to begin by determining what present coin could be adopted as a general unity of the monetary system, and he thought it would be very well for the delegates of each state to -draw up a plan of equations between their present coins and the monetary unity they would like to see adopted. These equations might serve as a basis for the proposed unification. Portu al would willingly adopt the five-franc piece as a unity, as it already has the reis at the foun atiop of its monetary system, and if its minuteness renders it defective, it has the advantage of representing with tolerable precision the thousandth part of the five-franc piece. Therefore he thought some preliminary discussion of question eight should be entertained.

Tl1ePRES1DEN'1‘ recalled the incidental decision of the conference in favor of reducing the

dollar to five francs, and the sovereign to 25 francs. The question did not concern the florin and dollar countries, and therefore M. Villa-Major’s proposal would suit them. The conference could do nothin better than to agree unanimously upon the adoption of a single monetary unity, and M. arieu believed no better piece than five francs, or one of its multiples, could be selected.

M. WALLr.NBERG mentioned in the preceding sitting that the gold iece of 10 francs seemed to present peculiar advantages. Divide it by 1,000 and you have tie centime, which is an excellent small monetary subdivision, while the five-franc piece divided by 100 gives five

centimes, a too great fraction for small payments. In large transactions the 10-franc piece

‘forms a good medium coin, a unity neither too high nor too low.

The PRESIDENT liked M. Wallenberg’s opinion ; in fact, the piece of 10 francs, taken as a monetary unity, would be very convenient for France, as in accounts it would only be necessary to change the comma to express new unities. Formerly the 10-franc piece had a universal circulation under the name of drtcat, a piece that was nearly of the same value. It was also the smallest gold piece till the five-franc piece was coined to supply the place of the silver five-franc piece, which was driven out of circulation.

M. MEINECKE would not discuss the question ; he thought the principal coins ought to be brought together by simple equations, each state remaining free to adopt the unity it pleases, provided its coins are easily changed to coins of other states. The principal unities would thus be assimilated, and therefore he was not authorized to pronounce in favor of fixing a monetary unity.

The PRESIDENT agreed with M. Meinecke that the coins should be easily exchanged ;~bu't there must also be a common denomination for them, and the smallest that could be conveniently adopted for gold seems to be the five-franc piece.

M. MEINECKE suggested a smaller unity, two francs 50 centimes, for instance.

M. J ACOBI preferred five francs, because it has whole numbers for multiples, as 10, 15, 20, 25, &c.. whereas the the unity of 2.50 would require fractional multiples.

M. HERBET remarked that the unity of 2.50 in gold would be inconvenient to coin ; and he instanced the 1.25 pieces that were issued at one time in Turkey, and found too soft and too small.

M. STAS thought the remarks about monetary unity would come in better with the discussion of question eight, and added that the 2 50 unity suggested by M. Meinecke would have the disadvantage of creating too many gold coins, and it -would be diificult to tell them apart.

M. KERN agreed with M. Stas, and_ the conference determined to postpone it till question eight is discussed.

The PRESIDENT then read question seven:

In case of an affirmative vote on one of the two preceding questions, would the internationality of the common standard coins be a suflicient guarantee of their circulation in each state; or would it be necessary to stipulate a certain limit in the relative value of gold and silver, or make provision for the case where the international metal might be expelled from circulation in any of the contracting states? I

The PRESIDENT remarked that this question regards the organization of the transitory situation of the states that have not the gold standard. Its principal aim is to harmonize the transition measures without affecting the decision of the conference in favor of the gold standard. It is necessary to make a correct estimate of the relations between gold and sil-ver, and if the rate of gold in Prussia and Holland were known exactly, mediums of exchange could be established that would gradually introduce gold, and expel silver from circulation, in the countries where it has served as a standard, without a financial convulsion.

M. MEES said, in Holland, if the rate of exchange continues the same as it has been for the few last years, the florin would be worth 2 francs 13 or 14 centimes, and the Napoleon 9 florins 35, or 1». Butit is hard to say how long the present rate of exchange will be kept up. In late years the value of gold has been sustained by its great demand in France, and the proportionate expulsion 0 silver. At present there is no more silver in France, and gold

as taken its place in circulation. The same want of gold is not felt now, and its value may diminish, particularly if it continues to be produced in considerable quantities.~ In such a case silver would rise; and knowing this, a state like Holland, that wishes to keep its silver circulation, would find some ditiiculty in fixing a definite relation between the two metals. Nevertheless, in the border provinces, the Napoleon might be rated at 9l- florins, and 4 thalers at 15 francs or 7 florins of Holland, this last being equivalent to the florin of south Germany, though it has a value less than seven-thousandths. This par equality between the two tlorins in the Netherlands is caused by the large exportation of silver to India, the silver diminishing so fast it is necessary to coin it continually. _ ~

M. MEES added,that if the gold standard were generally adopted and became the principal agent of general circulation, the dilficult in fixing a rate between the two metals would no longer exist, because, so far from diminis ing in value, gold would rise, and then there would be no danger in an approximate rate.

The PRESIDENT. It would be useful for the conference to examine these questions of relao tions between the two metals; for, if a preferred currency were given to one of them in a country, it would not only affect the circulation in that state but in the adjacent countries. There are great differences in Europe between these relations in countries where the double

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