Gold And Silver - Other Metals
( Originally Published 1918 )
As nearly as may be determined after careful research and estimate, gold to the amount of nearly $11,000,000,000 has been produced within the limits of history as we know it. About $2,-500,000,000 has been used in the arts, or lost through wear and tear of coins; somewhere around $1,500,000,000 has been exported to Asia and hoarded, and about $2,000,000,000 has been lost in ways now unknown. Thus it comes about that the gold now used in the form of money amounts to just about $6,000,000,000.
According to accepted estimates the production of silver from historic times down, totals somewhere over $12,000,000,000, of which about $3,500,000,000 is in the form of coin. The arts have called for almost $2,000,000,000 more, and about $2,000,000,000 have been absorbed by India and China. Silver unaccounted for amounts therefore to about $5,000,000,000.
The following historical and statistical matter concerning gold and silver, their production and their uses, is taken from a book compiled by Earl D. Howard and Prof. Joseph French Johnson, which has been quoted on another subject in a previous volume of this set :
"In ancient times there was considerable production of the precious metals, mostly from the mines of southern Europe. These sources were worked by slave labor almost exclusively, and the productions found their way into great hoards which served no valuable purpose other than to provide a visible evidence of the wealth and power of the owner. Only a small part of the existing stock of precious metals was used as a circulating medium, and of course at that time its use as a basis of credit was entirely unknown.
"Gold and silver were regarded as an end, not as a means; as treasure, not money. They were distributed, not by trade, but by war. It was the hand of the conqueror that stripped them from palaces and temples. If they were taken from the store of monarchs, it was not to freight the caravans of commerce, but to fill the chariots and mule carts, to load the sumpter horses or the camel trains of a victorious army.
"After the fall of the Roman Empire the mines fell into the hands of the barbarians in their southern migrations, and ceased to be worked. From that time on until the discovery of America the quantity of precious metals in Europe decreased rather than increased. Large quantities were used in decorating the churches. There was probably even less used for monetary purposes than the limited amount which had been so used in the ancient times.
"The Feudal Period.-Under the feudal system society was organized on a basis which required very little exchange of products, and most of such exchange as existed was done on a barter basis. Taxes and payments to the lord of the manor were made in produce. The royal court was maintained not from money taxes collected, but from the produce of the crown lands which the king received as the lord of the manor. Wars were conducted without the use of money; the soldiers were equipped from their own re-sources, and were sustained from the forage of the country traversed in campaigns.
"Discovery of America.—One of the most important effects of the discovery of America on European economic conditions arose from the quantities of silver which began to flow in an increasing stream from the Spanish colonies to Spain and from thence to be disbursed through-out Europe. The eager quest of the early explorers for the precious metals can be better understood when we know that the value of silver was many times its value today, and that the precious metals were about the only property which could be profitably transported during those times, when transportation was so difficult and expensive.
"When Columbus and the explorers who followed him set out on their quest for undiscovered countries, it was largely with the hope of finding gold and silver. Gold was found at the outset in Hispaniola, the first island acquired by Columbus for Spain., but even with the forced labor of the natives it was obtained in only limited quantities. The quest for gold, at first disappointing, was more amply rewarded after the conquest of Mexico by Cortez, about 1520, and of Peru by Pizarro, about 1532. The treasures which had been accumulated by many years of mining by the simple but partly civilized peoples of these countries were poured into Europe and were the subject of most fabulous estimates as to their amounts. Thus, the ransom of the Inca of Peru extorted by Pizarro—a sum equal to about $4,000,000 gold (of our money) and an additional sum in silver—was a large amount to be distributed among a small body of adventurers, but did not add greatly to the monetary resources of the world. It was the discovery of rich silver deposits of the mountain of Potosi, in Peru, about 1545, which revealed the New World as an important producer of the precious metals and especially of silver. Up to this date (1493-1545) the production of gold preponderated in the proportion of about $220,000,000 to $144,000,000 in silver, but from that discovery, followed by many others, began what Leroy-Beaulieu designates `the first age of silver.' It was an age which lasted nearly three centuries, terminating about 1840, and which brought into the commercial world nearly $6,000,000,000 of silver against less than half as much gold.
"Effect of Silver from America.—The effect of American silver upon the economic conditions of Europe was revolutionary. Payments from tenants to landlords for the use of the soil had been made either in produce or in labor, a system which reduced the tenant to a condition not far removed from that of the slave. Commerce was so limited that every community had to be practically self-supporting, and its consumption was limited to the articles which could be produced in the immediate vicinity. The lack of commerce made it possible for famine to exist in one county while great plenty existed in a neighboring county.
"The transmission from payment in kind to money payments, which soon profoundly altered the relations between the lords and tenants, making the latter much more independent, was not so much due to the greater abundance of money as to the effect produced by the new silver on prices of all commodities. The Spaniards to whom this new silver first came, appeared in the markets of Europe as purchasers of goods, thus creating a steady demand for export. The rise of prices and the steady market gave a stimulus to industry. Originally money had been hoarded as a protection against misfortune. This was justified by the conditions of the time, which made it difficult to accumulate any other form of property. The land was not bought and sold as today, but was considered permanent in the possession of families who held it under various forms of limited title from the king or lord.
"There was very little opportunity to acquire productive capital. What little invested capital there was in the form of flour mills and the like was held by the lords under the same conditions as the land—practically. Money was therefore about the only form of property in which savings could be invested. There was no incentive to circulate money except when misfortune forced the possessor to release it for the necessaries of life, or when it was extorted by force.
"Increased Circulation of Money.—The rise of prices, accompanied as it was by the growth of commerce and by the commutation of money for labor dues, had the effect of putting money into circulation. As opportunities increased for the investment of funds in some form of productive property, the tendency to hold money grew less and less, especially as the increase in the value of goods and the decline in the value of money made the latter very unprofitable and a losing investment.
"It is doubtful whether the new silver which flowed into Europe, when measured in terms of value, increased the amount of money. An ounce of silver was worth so much less that the increased quantity had little more power to per-form money work than the smaller quantity had before. The effect was produced by the change of prices, and by the consequent increase in the circulating power of the stock of silver already existing in Europe.
"Discovery of Gold in California.—The quantity of gold and silver in the world was subjected to another great change in the middle of the nineteenth century. On January 28, 1848, a workman named Marshall, while erecting a saw-mill on the American fork of the Sacramento River, discovered gold in the mill race; and within three years from that time California had not only become a part of the United States (it had previously belonged to Mexico), but had also been admitted as a state under the compromise of 1850. Gold had been discovered in Australia in 1823, but mining had been discouraged by the government. Under the stimulus of the California gold discoveries, the government changed its attitude, and the rush of gold seekers to Australia in the early eighteen-fifties was almost as great as that to California. As a result of these discoveries the annual average production of gold increased from about $16,000,000 be-fore 1850 to nearly $130,000,000 between 1850 and 1870. The effect upon prices may be seen in the price tables of that period.. Since 1870 it has about quadrupled.
"Effect of California Gold.—Owing to the fact that the monetary circulation in this country during that period consisted almost entirely of bank notes based on specie reserve, the effect of the new gold was not so pronounced as it would have been had the circulation consisted entirely of specie. The gold which was not required for circulation in California and which was not ex-ported was used to strengthen the bank reserves and to provide for the increased circulation required by expanding industries. The tendency of the sudden addition of so large a quantity of gold to the world's supply would have been to raise prices very sharply, had it not been diverted by these considerations.
"After 1870 the annual production of gold declined steadily for twenty years, and had more serious economic effects than the increase in the previous twenty years had had. The declining prices which it occasioned gave rise to the silver question which agitated the world for more than ten years.
"South African Gold.—The discovery of gold in South Africa in 1889 and in the Klondike region a few years later brought another period of increased gold production, and a rise in prices. These later discoveries, combined with the invention of new processes for the extraction of gold, have given the science of money an entirely new turn within the last ten years.
"Origin of Gold.—The specific gravity of gold is very high and is exceeded by very few metals, most of which are exceedingly scarce and valuable. The theory is that when the earth was thrown off from the sun it was in a gaseous state. The gradual cooling of the mass and the dispersion of heat permitted the formation of Iiquids and finally of solids. The first solids to be formed were the metals of the highest specific gravity, which naturally sank to the center of the earth through the gaseous and liquid medium by the force of gravity. As the cooling process continued and the earth took solid form, there were tremendous upheavals of the surface. The enormous heat at the center formed gases which in escaping threw up to the surface molten matter containing gold in combination with other elements. This accounts for the presence of gold in mountainous localities where the upheavals have been severe, and give rise to the theory that at the center of the earth gold exists in large quantities.
"Sources of Gold.—Until within recent years practically all the gold produced was taken from gravel deposits. The free gold had been washed out of the rock by erosion and carried down in the streams, and because of its great weight had sunk to the bottom of the stream not far from the place of its origin. These small particles of free gold were separated from the mass of sand and gravel by the simple process of "panning." The mass was mixed with water and gradually shaken until the sand had been washed away, leaving only the heavier material behind. The fine particles of gold were separated from the gravel by means of quicksilver, for which it has a very great affinity. The gold was then separated from the quicksilver by filtering the latter through heavy skins."
Leaving aside iron, the basic metal of industry, and the metals used in combination with it to produce the various forms of steel, there remain in the wake of gold and silver other metals, two of which are used in coinage to some extent—copper and nickel.
Copper, slightly alloyed for hardening purposes, is coined in one cent pieces only. But next to iron it is the most important of all metals in many and widely diversified arts and industries.
Copper is indispensable to electric industries. Next to silver, it has highest conductivity—somewhat over 90, taking silver at 100. It is the most compliant of all metals, blending with many others, and meeting more useful requirements than any other. In theory it is not a noble metal; in utility it is one of the noblest, if nobility may be conferred in terms of service.
Its history began in the ages back of our term of history. Homer tells how Hebe "to the chariot rolled the brazen wheels, And joined them to the smooth steel axle," before the walls of Troy—and brass then was a blend of copper with tin, and so remains; a familiar commodity.
The oldest copper mine is the Rio Tinto, in Spain, which has been operated continuously two thousand years. It furnished the Romans with most of their "cuprum" supplies. Its copper is in a pure state, ready to be worked.
The greatest mine of virgin copper is the group known as the Calumet and Hecla, in upper Michigan. The metal was discovered there by Prof. Louis Agassiz, the naturalist, incidentally to a scientific investigation wholly foreign to mining. Prof. Agassiz declined to have anything to do with commercializing the mines, because (he said it, himself) he "had no time to make money." The company set aside for him a block of its stock to which he gave no attention, being busy; but it made his family very rich.
Copper is widely distributed in nature, but the western half of North America is peculiarly rich in it. The Bonanza Circle around Bisbee, Arizona, has a steady and enormous output. So has the region around Jerome, near Prescott, in the same state. The United Verde mines, opened by the late Senator Clark, are there. The Anaconda group near Butte, Montana, has produced heavily and steadily since the late eighteen-seventies.
Almost 60 per cent of the world's annual supply of copper is furnished by the United States.
Nearly all the copper ores of the mountain states are carbonates, oxides, or sulphides, but most of them carry considerable gold and silver and nearly all carry their own flux of lead and silicates, so that they yield readily to treatment.
Copper moves more money every year than any other staple metal, aside from iron.
Nickel is a reddish white metal, very hard, difficult to purify, highly magnetic, ductile and malleable when purified. Cobalt is an ore of nickel-silver. Canada has the most important nickel and cobalt mines.
In current coins, nickel appears as a five-cent piece, originally issued in substitution for the old silver half-dime, which was too small for handling.
Tin, though of intimate daily use, is not very widely distributed, but has been an important quantity in trade, dating from the days before Phoenicia instituted a merchant marine. The Phoenician merchant sailors traded with Wales and Ireland for the tin of those countries, and through the relationship thus established made marriages there, and founded a strain that is visible in their present populations. The oldest tin mines are in Wales. Their workings in some places extend far out under the sea.
Very few articles are made of tin, but millions are made of other metals surfaced with tin.
Lead is a soft, heavy metal, widely distributed in nature, often found in its nearest pure form, known as galena, but more frequently in combination with silver or associated with zinc. The bulk of the world's supply is furnished by the United States.
Zinc is not found as an isolated metal, but always in ores. In its pure state it is hard, but it softens freely at a temperature as low as 250 Fahrenheit, and may be rolled or hammered into sheets or other forms desirable for handling. It is the positive element in voltaic batteries, being indispensable as the positive element in secondary batteries. Its commercial form is known as spelter.
The oldest zinc mines are in Flanders. The company owning them is called Le Veille Montaigne. They have been in active production several hundred years. Their lower working levels are nearly 4,000 feet below the surface.
Platinum, a metal more valuable than gold, is the heaviest of all known metals. It was first found at Choco, Peru, in 1741, and is comparatively rare, and most frequently associated in ores with other metals, known as platinoids. These are palladium, rhodium, iridium, osmium, and ruthenium, all rare and of great value in chemistry.
Platinum is exceedingly hard, ductile, malleable, tenacious, and difficult of fusion. It does not tarnish. In the commercial form it has the appearance of bright silver. It is used largely in jewelry, in electrical apparatus, and for other purposes in which it gives service not obtainable from any other metal.
Aluminium, commonly called aluminum, is the most widely diffused of all. In various compounds it forms one-twelfth of the earth's crust. Its most advantageous compound is with the feldspars, which decompose and form clay. The distinctive aluminium clay is called beauxite, and is found in quantities in various parts of North America. Aluminium is light, and does not oxidize. It can be separated from its compounds only by processes so costly that its commercial use was for a long time very limited. By improvement in electrolytic methods it is now being produced at a cost about equal with that of producing copper. It is used mostly in an alloy with copper called aluminum bronze, and with another called aluminum silver, which has the bright appearance of polished silver, but cannot be tarnished by gases.
Tungsten, which has been known since the latter part of the eighteenth century, came into world demand through the rapid advance in improved steel processes during the last thirty or forty years. Its principal ore is scheelite, which formerly had slight value, but now commands a high price per unit of tungsten content. It is grey-white, nearly as hard as steel, brittle, and less fusible than manganese.
Manganese is another mineral necessary to produce certain kinds of steel. It occurs in ores that are called by its name, but never is found in the metallic state. It is hard, and difficult to fuse. It is neither expensive nor rare.
Molybdenum, in chemistry an element usually found in the ores of wulfenite, is a hard, silver-white metal, with a very high fusing point.
Wulfenite is a red tetratagonal mineral consisting of protoxid of lead and molybdenic acid.
Vanadium looks like silver, but is extremely brittle. It does not oxidize in air or water.
Radium, in ultimate metallic form, has not yet been produced. The substance called radium is an oxide. It is obtained by intensive condensation of pitchblende ores, several tons of which are necessary to the production of three grains. The present supply of radium is under four ounces.
Uranium and Thorium have the same radioactive property, but radium exceeds either of them 1,500,000 times over. It was discovered by Mme. Curie at the Curie laboratory in Paris.
Mme. Curie named it for its power of emitting rays. It is probably the most valuable substance known to man, and its uses are not yet fully known.
One of its curious performances proved the transmutability of metals, the dream of ancient alchemists. A quantity of the gas of radium left standing for a time was found to have become a gas of helium, an element first discovered in the sun's atmosphere,, but since found in a few rare minerals.
Antimony is a brittle bluish white element, sometimes found pure, but usually in alloy with other metals. Its peculiar characteristic is that it expands at the moment of solidifying, and this gives it value as a constituent of alloys not affected in bulk by heat or cold.
Other Metals.—There are many other metals of great cost and rarity, that are required in the most advanced work of the science of chemistry, but do not come within the category of metals as generally understood.
The importance of all these metals is so vast, and the production of and trade in them runs into figures so enormous, that special trading concerns and many banks, all strongly capitalized, have of late come into the field of finance, and are acquiring eminence in that field.