There is more gold at one time than
another, and more wheat at one time than another; so that the relation
between the two is not a determinate, but a variable one; and it is this
variation which causes or constitutes the fluctuation of prices. If wheat
increases in quantity, more of it will be given for the same money; and if
it decreases, less of it will be given for the same money; on the other
hand, if money increases, more of it will be given for a specific quantity
of wheat, and if it decreases, less will be given; while if they increase
or decrease together, a relative equilibrium will be maintained. But the
beauty of the precious metals, as we have said, is that they are not liable
to very sudden or considerable increase or decrease; only twice in the
course of history, on the occasion of the discovery of the South American
mines by the Spaniards, and of the California mines by the Americans,
has there been recorded an unusual production of gold and silver; and in
both cases, it is important to note, the same effect followed,--a very
considerable enhancement of prices; that is, all other articles seemed to
grow dear, although the real fact was that money had only grown cheap.
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