“The Crime of ’73,” has often been overlooked, when most regard “The Crime of ’93” as being far more important. Both are important, but we should refer to the Constitution, which says that the Congress has the power to “Coin money and regulate the value” of it. In 1792, following the advice of Alexander Hamilton, the various denominations of coins were set, including the penny, nickel, dime, quarter, etc. The dollar was to be 371.25 grains of silver or 24.70 grains of gold.. A ratio of 15 to one, gold being 15 times more expensive that silver. That lasted for close to a hundred years, with variations. The term “free coinage,” meant simply that if a person presented gold or silver to the U.S. Mint, it would be converted into coins at no charge, or “free coinage.” Most mints charged for the conversion. In 1834, legislation raised the ratio to 15.621 to 1. This “did something for gold,” since gold had been discovered in Virginia, South Carolina, North Carolina, and Georgia. Then, almost immediately, the ratio was changed to 16 to 1. This was at the time President Andrew Jackson, refused to renew the charter of Nicholas Biddle’s “Bank of the United States, which was an early day Federal Reserve. Hooray for Jackson! The 16 to 1 ratio gave gold at $20.67 per ounce and silver $1.29 per ounce. As I write this, the ratio is 62 to 1, meaning that silver is a great bargain!
A few years later, the War Between the States came along, and both North and South, printed unbacked paper money, and both became worthless eventually, due to endless printing, which is what is happening to the dollar today. Today, the dollar has fallen so much, that a gold is about $1400 per ounce, and silver $22.50.
Getting back to 1873: The act eliminated “The free coinage of silver.” this meant that if a holder of silver took it to the mint to be turned into coinage, there would be a charge, which had the effect of degrading silver. Not only that, but the act eliminated the silver dollar, the silver ’half dime,’ the silver ’3 cent,’ silver ’2 cent’ coins, which had been in common use. The gold dollar was to be the dollar unit measured. The 1873 period, saw a depression and hard times for farmers and the common man. The 1873 legislation proved to be a disaster, and 20 years later, it became part of a heated Presidential race. By eliminating the silver dollar and the other three coins, much smaller amounts of silver were used, and the ratio rose, to eventually go to 30 to 1. Silver went down to about 69 cents an ounce, making it almost unprofitable to mine, but the government did buy it at the 16 to one ratio, and actually made silver dollars, which it stored in its vaults. In 1878, the “Bland-Allison” act, forced the government to purchase silver at high rates. In 1890, President Benjamin Harrison signed the “Sherman Silver Purchase Act” which made the government purchase $4.5 million worth of silver every month..
In 1893, the “Sherman Silver Purchase Act” was repealed, and government purchase of silver stopped. Mines in the west, and especially Colorado, shut almost immediately, and ’ghost towns’ were created instantly, the remains of which can still be seen. A few years later, it was discovered that in the tailings of these shut mines, gold was present, and the tailings were rerun, at a profit. Gold then was the ore to mine, and many mines re-opened again. If silver had not been literally demonetized in 1873, (no silver dollars and other silver coinage), the ratio would have undoubtedly remained at 16 to 1, and hundreds of thousands of farmers, workers, and working class citizens, would not have been ruined. When silver purchased stopped in 1893, the price of silver dropped to 62 cents, which was far lower than the cost to mine it. With Silver not being purchased, and silver being demonetized, there was a real shortage of money, which caused prices to decline. Farmers by the thousands were being foreclosed, and the theory was that if silver once again were monetized, there would be more money in circulation, prices would rise, and farmers and manufacturers would be saved.
William Jennings Bryan
Bryan was a golden voiced, superb public speaker. Born March 19, 1860, he was a life long politician, and was a a populist Democrat. He ran for President three times (1896, 1900, 1908), and served two terms in Congress. He was the 41st Secretary of State under Woodrow Wilson. It was his first run for President in 1896, which made him famous. He wanted to see silver re-monetized, and the money supply increased, which the bankers and Wall Street didn’t want. Bryan defeated Grover Cleveland in the primary, and at age 36, became the youngest Presidential candidate in American history. He gave endless speeches across America, stressing the fact that remonetizing silver was important, and would revive America. His most famous speech was his “Cross of Gold” speech, which ended with, “Having behind us, the producing masses of this nation and the world, supported by the commercial interests, the laboring interests, and the toilers everywhere, we will answer their demand for a gold standard, by saying to them, you shall not press down on labor, this crown of thorns, you shall not crucify mankind upon a cross of gold.” Unfortunately, Brian lost. He became famous as the defender in the Scopes Monkey Trial, which he lost, and died a few days later.
2013
Today, both silver and gold have been demonetized for all practical purposes. The U.S. Mint, in West Point New York, does make and sell millions of both gold and silver Eagles. Both have absurd values on them, which makes people play games with them. As an example, a Silver Eagle has $1.00 imprimatured on it, but sells for more than 25 times that amount, and the same with a $50 Gold Eagle, which sells for more than 29 times that much. The games which can be played with these coins need no explanation I am certain. While gold and silver are not monetized officially, as in all of history, they are true value and actual money. Bartering with them would be difficult, but they can easily be converted into dollars, euros, yen, yaun, or whatever is needed, anywhere in the world. As all paper currencies slide in value, all tangible things increase in currency prices, which is an obvious law of economics, which cannot be defeated.
I have worries about the stock market, and own no stocks. The question, when it comes to investing is, Would you rather own a hundred millionth ownership of a large corporation, which is at the mercy of management, governments, and public opinion, or would you rather own 100% of gold and silver , which are self backed, and dependent on the futures market for prices, which admittedly can be manipulated. When millions of ounces of non-existent silver or gold in the futures markets are bought and sold, this makes the prices of real silver and gold go up or down. Physical things cannot be manipulated or controlled forever, and costs to make tangible things, cannot be defeated, as they take dollars to produce, and the dollar is constantly losing value, thereby making all tangible things have to go up in dollars, sooner or later, regardless of futures prices, or other manipulations. I really believe that gold and silver prices, are right about their cost to mine, refine, manufacture, and distribute. As years pass, all costs will rise in declining dollars, so their prices will go up. A savings account paying less than 1% interest, in declining dollars, makes as much sense, as storing water in a leaky bucket. I have hundreds of customers who have tripled, quadrupled, or more in the values of their gold and silver. Prices may be down from a year or so ago, but gold was $360 ten years ago!