THE PRICE OF GOLD.

Lyttelton Times, Volume CXVII, Issue 17982, 26 December 1918, Page 6

THE PRICE OF GOLD.

TO THE EDITOR. Sir,—Mr Statham, M.P., tells Parliament that " the price of gold is a quo3.ion not only calling for tho attention of the British Government and the American Government, but also of the Government of New Zealand." He says that " the American people are now considering- the increasing of the value of the sold standard," and ho complains that " the arbitrary price which was fixed for goid by tho Bank of England, many years ago, is still- retained." >.ow, the price of gold was never fixed by the Bank of England. Adam Smith said 150 years ago that " the law for the encouragement of the coinage, by rendering it duty free, was first enacted in the reign of Charies 11. for a 'limited time and afterwards continued by different prolongations till 17G1), when it was rendered perpetual. The Bank of England, in order to replenish their coffers- with money, are frequently obliged to carry bullion to the Mint, • and it was. mora for their interest, they probably imagined, that the coinage should bo at the expense of the Government than at their own. _ It was probably out of complaisance to this great company that the Government agreed to mako this law perpetual." It is absurd to suppose that any law of Georgo 111. could make it " perpetual." This law mado tho coinage of silver free as well as gold, but has been abolished as far as silver goes, and ought to bo as regards gold. Kow, gold coinage being freo, if the sovereign were made of one ounce of pure gold, the price of pure gold would be one pound' sterling per ounce. The ' coinage stamp would guarantee tho weight and purity of tho gold, and make it legal tender. Bin standard goid of which bur coins are made contains a twelfth part of alloy to harden the metal for tho wear and tear of circulation. BV the Mint regulations twenty pounds troy of standard gold is mado inio nine hundred and thirty-four sovereigns and ono half-sovereign. Therefore, the value of twenty pounds troy weight of standard gold or of sovereigns is .£3 17s IOJd per ounce troy. Consequently tho price of pure gold is " fixed " at £i 4s. lljd per ounce. Perhaps Mr Statharu will explain how it is proposed to increase the "arbitrary price of gold!" Mo doubt tho gold mining shareholders would like a war profit on their gold, but instead of that they ought to pay tho Imperial Government foi valua received in converting their raw material into sovereign!!, maing thorn legal tender and guaranteeing the weight and purity of each coin. People talk, of the " shrinking of the sovereign," but that in only camouflage for the increased oost of living!* If a man buys a writing pad, which before tho war contained one hundred sheets, ho will probably now got only •fifty sheets, It is the paper which lias shrunk, not the shilling, nor tho rovereign, and wo hope not the on« pound note, so long ns governments do not tamper with the standard -of value. So it is with milk, butter, cheese, meat, wool, o,nd almost, everything, not forgetting imports. Gold to the value of rover £11,000,000 has been taken from tho Waihi mines. Why should not tho Imperial Government have charged expenses, profit and stamp tax far coining probably all of it? If gold mining doesn't pay, coal raining does, and it would be better for men and country if Ihoy were occupied in getting golden harvests on top of the land, instead of burrowing under it far gold.—l am, etc., J. MILES VEKRALL. Swannanoa, December 18, 1918.