THE FUTURE OF GOLD.

AFTER the year 1850, when California and Australia were sending out into the world annually about thirty-five millions sterling in gold, Michel Chevalier and Cobden raised the cry of alarm: the world would be completely submerged by a deluge of gold. After 1867, the production of gold rapidly diminishing, an entirely opposite fear gradually gained ground amongst far-seeing business men. In 1869 in the review of the preceding year, the Economist wrote: It may safely be affirmed that the present annual supply of 30,000,000l. of gold is no more than sufficient to meet the requirements of the expanding commerce of the world. The real danger is that the present supply should fall off, and amongst the greatest and most salutary events that could now occur would be the discovery of rich gold deposits.'

In 1871, after the decision of Germany to proscribe silver, the uneasiness of the Economist increases, and it writes thus: As the annual supply of gold is reckoned at little more than 20,000,000l., and the annual demand for miscellaneous purposes is very large, it follows that if the German Government perseveres in its policy, the strain upon the existing stocks and currency will be most severe. Unless the annual production of gold should suddenly increase, the money markets of the world are likely to be perturbed by this bullion scarcity.'

What the Economist foresaw has taken place. The scarcity of gold has induced so great a fall in prices that they are now lower than in 1850. Mr. Robert Giffen clearly showed this in an excellent study which has never been disputed, but which has, on the contrary, been confirmed by such men as Thorold Rogers, Patterson, Samuel Smith and Williamson of Liverpool, John Hector, T. Smith, and many others. Who can doubt that the present crisis from which the entire world is suffering is due to the scarcity of gold? Up to the present time, exchanges have been effected in civilised countries by means of two metals, gold and silver; to-day, the coinage of silver having been suspended, except in India, the stock of money in the world is now only fed by gold, and at the same time the production of gold is yearly diminishing, and, what is worse, for the last three years America has taken for herself more than sixteen millions annually-that is to say,

the whole total production, less four millions, which do not suffice to cover even industrial wants. Bagehot estimated that England absorbed yearly for industry and coinage from four to five millions sterling. On the contrary, in 1879 England exported a surplus of gold, amounting to 2,389,8261. and in 1880 4,249,4497. The coinage in Europe has now sunk to almost nothing. In France the coinage of gold, which amounted in 1877 to 271,645,425 francs, and in 1878 to 189,139,520 francs, sank in 1879 to 24,610,540 francs. In England last year the amount of gold coined was quite insignificant, 35,000l. only. Silver can no longer, as recently, help the circulation and effect exchanges, for it is no longer admitted at mints. The production of gold, which was thirty-five millions annually some years ago, does not now exceed nineteen or twenty millions. It is clearly evident that these circumstances united-viz. the proscription of silver, the decrease in the production of gold, and the draining of gold to America -have led to an appreciation of gold, a fall in prices, and to the present crisis, as the inevitable consequence of monetary contraction.

This being the case, it is of the highest importance that we should carefully examine if the production of gold is destined to increase or diminish, for the economic conditions of the whole civilised world are dependent on this. If more gold be not found, silver still being proscribed, prices will continue to fall. Prices falling, the burden on all those owing gold will increase, for they will be forced to sell more articles to obtain the same quantity of gold; farmers will have more and more difficulty in paying, for the produce of their farms will lose in value; manufacturers will be exposed to heavy losses, for while converting the raw material into manufactured goods, the general fall in prices will make itself felt, and the manufacturer will in all probability find himself working at a loss.

It would be rash to predict, with too great certainty, anything definite with regard to the future of gold; nevertheless, taking as a basis ascertained historical facts, and geological researches with respect to the earth's crust, it is not impossible to arrive at certain conjectures which may be at least looked upon as probabilities. This is what an eminent professor at the University of Vienna, Dr. Suess, has attempted to do in a work entitled Die Zukunft des Goldes (The Future of Gold). This book attained a very high reputation throughout Germany, and has been successful in convincing some of the most able economists that it is essential to restore to silver its attribute of money, of which it never should have been deprived. The conclusions Dr. Suess reaches are as follows: The production of gold will in the future diminish and the mines become exhausted the more rapidly as the present means of working them are more perfected and powerful. The discovery of new mines in hitherto unexplored regions may, for the time being, stop this ex

haustion, but the expanse of new country where we may hope to meet with these mines is rapidly diminishing, and in the parts previously colonised, mines once very productive are being one after another abandoned. We will examine how Dr. Suess treats these different points.

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Gold and silver are essentially the precious metals' from the mere fact of their being rare. The scarcity of gold is certainly the chief cause of its value. But can it be explained why gold is so rare? According to Dr. Suess, it is because gold is one of the heaviest metals. Three metals are noted for their extreme density-iridium, platinum, and gold. Their weight compared to water taken as a unit is represented by the following figures: iridium 22.23, platinum 21.50, gold 19.253. With the exception of that strange and also rare metal, mercury, the density of which is 13.59, gold and platinum weigh more than any other metals; for, as an instance, lead reaches 11.35, silver 10.47, bismuth 9.82, copper 8.80, nickel 8.27, and iron only 7.84. Is there a connection of cause and effect between these two facts, that gold is a rare metal and, at the same time, one of the heaviest that exist? One would be inclined to think that there is, if one admit that the earth was first in a gaseous and afterwards in a liquid state. In this case the heaviest matters must have occupied the centre of the globe in a smelting condition. If it be true that our whole planetary system has been formed from matter, which constituted in the beginning an immense nebula, it follows that the planets the nearest the centre must be the heaviest. These ideas were brought forward by the great German philosopher Kant about the middle of the last century, and have been from time to time referred to since. The great weight of platinum and gold,' says a German naturalist, Petzholdt, is the reason for these metals being so scarce on the surface of the globe, for the greater quantity of them is contained in the still liquid kernel of the earth, there shielded from men's greediness.'

Some observations that have been made help to support these ideas. The spectrum analysis reveals no gold in the sun; we may therefore conclude that it is quite in the centre, hidden from view by other lighter bodies in a gaseous state forming the photosphere. The planets may be divided according to their weight into two groups. The planets in the interior of the circle of asteroids are comparatively heavy, those exterior are comparatively light. Mercury, the nearest to the sun, weighs almost seven times as much as water; Venus, the Earth, and Mars, five times as much; while Jupiter weighs barely as much as water; Saturn 0.73 and Uranus 0.84, therefore less than water. The density of Neptune, which has not been quite accurately determined, is at all events very trifling. So we see that in our planetary system the heaviest bodies are the nearest to the centre, and this leads us to assume that the same distribution of matter will be found in each planet. As the rocks form

ing the surface of our globe weigh on an average 24 times as much as water-limestone 2.6 to 2.8, granite and gneiss 2.54 to 2.7, and lava or basalt 2.7 to 3-and as, on the other hand, the specific gravity of the globe is five, we are necessarily led to conclude that the interior must be composed of heavy matter, far exceeding in weight the earth's average of 5. The existence of gold in the central strata of our globe appears, therefore, very probable.

But if this be the case, how can we account for gold and platinum being found on the surface of the earth? It can be explained by the action of hot springs and volcanoes. These two heavy metals are always found amongst rocks of an igneous origin—here where volcanic rocks have pierced through and scattered earlier formations, and there where granite has broken up schists. Platinum, which has only been found in abundance in the washings of Nijni-Tagil in the Ural, comes from the serpentine, a rock coming from the depths. Gold is chiefly found in quartz veins. These veins appear to have been formed in the following manner. As a natural consequence of the contraction of the earth's solid crust, and of the upheaval and disturbance of the previous formations, crevasses have formed themselves. They have become filled with quartz, sometimes auriferous, either by the action of hot springs or by sublimation. In these veins, usually poor, exceptionally rich zones are here and there to be found; German miners call them edle Säulen' (noble columns), and Americans' bonanzas.' It is the working of these bonanzas that renders veins profitable, which generally contain, apart from them, so little gold that the miner literally works at a loss. If the work be continued it is in the hope of coming upon one of those rich zones, which sometimes far more than compensate for any former deficit. The extreme scarceness of gold that can be dug up is therefore a fact, and a fact easily accounted for when we consider its distribution and the geological origin of this metal.

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Let us now recall some historical facts which lead Dr. Suess to conclude that the production of gold will diminish in the future. The soil from which we obtain gold may be placed under three heads: auriferous rocks, auriferous veins, and auriferous alluvium.

I. The first group comprises rocks rich in magnesium and with gold scattered through them. A good example of this is the mines of Nijni-Tagil in the Ural, where platinum is also found. As a transition between this division and the next may be cited the auriferous minerals contained in some rocks of an igneous origin, as, for instance, the gold that is to be found in the granite of the west coast of South America and in certain parts of Brazil. Granite containing tin in the Erzgebirgen, in Bohemia, is a similar formation. This division of auriferous grounds, very interesting from a geological, is less so from an economic point of view, for it contributes but very slightly to the production of gold.

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II. The next group, the auriferous veins, comprises all the veins that have filled up, by means of hot-springs or geysers, the fissures in ground upheaved and broken. These veins may be subdivided into three categories according to the different natures of the soil in which we find them. (A.) Veins of recent volcanic rocks, principally the propylite. Gold is here found mixed with silver, and it is only in this division that those exceptionally rich seams-the bonanzas are met with. To this category belong the Comstock Lode, in Nevada, which is the most noteworthy example; the auriferous beds of Queensland, some in New Zealand, and those of Schemnitz in the Carpathian range of Hungary. The gold is found sometimes in spangles and as electrum,' or silver and gold combined, or, again, mixed with copper or sulphur. (B.) Veins in more ancient volcanic rocks, especially diorite. The gold here is not, as in the preceding division, mixed with silver, but, on the other hand, there are no bonanzas. The best example of this category are the veins of Victoria. (C.) Veins in the schists, where they meet with granite, or even in granite itself, even distant from volcanic regions. It is supposed that in this case granite has been the eruptive force which has brought the gold with it. These veins are sometimes very extensive: as, for instance, the famous Mother Lode in California, which spreads itself over a vast region; but experience proves that they are seldom sufficiently productive to repay a miner's toil. Silver is never found here, and gold only in the same circumstances as in the preceding divisions. Examples of this class are to be found in California, in New Caledonia, in Tasmania, and in the Pennine Alps.

III. Auriferous alluvium. This alluvium is formed by the decomposition of different rocks containing gold, but it has been remarked that recent volcanic regions give much less than other classes of grounds. The veins richest in precious metals are, therefore, not those which produce deposits containing the most. Gold is in this instance generally found as spangles or quite tiny grains, and sometimes as nuggets, of the size of a hen's or even a turkey's egg. An extraordinary point is that the gold found in this alluvium is purer than the metal found in the veins from which it comes, though, of course, this must have proceded from them originally. Neither this phenomenon nor the formation of nuggets has yet been satisfactorily accounted for or explained. The 'placers' of California, Australia and Siberia are the most remarkable examples of auriferous alluvium. This latter can also be divided into two categories: (A.) that found on the surface of the earth, on river banks, where gold can be almost picked up, sifted from the soil and washed in the most primitive fashion; and (B.) that of an earlier date, covered over by more recently deposed soil, and which can only be reached by labours which frequently entail large expense.