Front Page Titles (by Subject) CHAPTER I.: a general distinction between those private incomes which will, and those which will not be affected. of a certain collective loss which the people of france will suffer. - On the Probable Fall in the Value of Gold: The Commercial and Social Consequences which may ensue, and the Measures which it invites
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CHAPTER I.: a general distinction between those private incomes which will, and those which will not be affected. of a certain collective loss which the people of france will suffer. - Michel Chevalier, On the Probable Fall in the Value of Gold: The Commercial and Social Consequences which may ensue, and the Measures which it invites 
On the Probable Fall in the Value of Gold: The Commercial and Social Consequences which may ensue, and the Measures which it invites. Translated from the French, with preface, by Richard Cobden, Esq. (New York: D. Appleton and Co., 1859).
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a general distinction between those private incomes which will, and those which will not be affected. of a certain collective loss which the people of france will suffer.
I will suppose the case of an inhabitant of London, who is possessed at the present time of a certain income, for example, of £ 1,000 sterling. Assuming the event of the fall in the value of gold to have been completely consummated, he will continue to receive, as at present, for every pound sterling composing Ms revenue a metallic disc containing 7 grammes, 318 milligrammes (113 grains) of fine gold, for that is what constitutes the piece called a sovereign, or the pound sterling. But the fall being accomplished, if gold has lost the half of its value, then, in transactions where one piece of gold was previously sufficient, two will be required, so that with the same number of discs the individual in question will only be able to procure in bread, in meat, in all kinds of articles, in every description of gratification, the half of what he would have obtained before this monetary revolution. Thus, in order that he might not be impoverished, in other words, that he might have the same subsistence, it would be necessary that his income should have nominally doubled itself, that it should be £ 2,000 instead of £ 1,000. This observation relative to a person residing in London would apply equally to an inhabitant of Paris, provided we still continue the tolerance, not to say the negligence, by virtue of which gold is unduly circulated on the footing established by the law 7 Germinal, year 11, notwithstanding that events have since overthrown the hypothesis on which, so far as gold is concerned, that law was framed.
It follows, therefore, that if we would particularise the persons who will be more or less deeply affected by the fall in gold, we have only to select those whose income, expressed in monetary units (the pound sterling in England, and the franc in France), will not find itself augmented, naturally and by a self-adjusting process, in exact proportion to the fall, and by the very fact of the fall in gold.
All those persons, whose incomes expressed in monetary units remain the same, would be injured by the change to the extent of the half of their income, all other things being equal. The national creditor is the characteristic type of this class of sufferers.
The proprietor of government stock is in fact the holder of a title by which a certain State engages to pay yearly a given number, agreed upon previously, of francs or pounds sterling; in other words, a well-defined quantity of metal. The current value of the capital of the public funds in each State is regulated by this very quantity; all other things, such as the solvency of the government, the degree of confidence which it inspires, and the abundance of capital upon the market, being equal.
All commodities excepting gold, and every kind of property excepting that of which the income is from the present fixed, as is the case with the government funds, ought, from the moment that the monetary crisis is terminated, to have attained in a gold currency double the price which they are at present worth, upon the supposition, quite arbitrary I admit, of the depreciation reaching fifty per cent. Thus, a house or a landed estate now worth £ 4,000 or 100,000 francs, would then sell for £ 8,000 or 200,000 francs. The hectolitre of corn or of wine, the quintal of iron, or the metre of calico will undergo the same rise, at least if no change conducive to cheapness be introduced into the conditions of their production, or into the relations between the supply and demand. It will be the same eventually with the wages of labour, and with all personal services, whether rendered in the factory or the farm, or from the liberal professions: we are warranted in believing that their value will have doubled.
Thus, as a definitive analysis, the proprietors of lands, houses, and other real estates, manufacturers, merchants, and their auxiliaries of every kind; public functionaries of all ranks; and also those who follow the different learned professions, will all find themselves in the end compensated in the new state of things with advantages equal to those which they now enjoy,—all other things being equal. It is another class of persons, whom we have previously defined in a general way, who would have to submit to a sacrifice in proportion to the fall in the precious metal.
Looking merely to the substitution which would have to be made in the currency of a country like France, where gold is taking the place of silver, that country would experience a sense of very serious disappointment at having exchanged a commodity which has actually a fixed value —its coined silver—for another metal the value of which is declining and must fall one half, according to the supposition which we have made, and which we have adopted solely for clearness of speech and precision of argument. The quantity of silver on which this disastrous exchange had been effected to the 1st January, 1858, was not less than a milliard (£ 40,000,000), which has been bartered for gold at the rate of 15½ kilogrammes of silver against 1 kilogramme of gold. At this rate, France will find at the close of the fall that she has been on an immense scale, almost imitating the trade of a certain sporting individual who, for a wager, passed a morning on London Bridge offering sovereigns to the passengers in exchange for shillings. Assuming that at the point of departure the silver currency of France amounted to 2½ milliards, (£ 100,000,000), this beautiful operation would cost her a very considerable amount, a sum so much the nearer to 1,250 millions (£ 50,000,000) in proportion as the abstraction of her silver had been more rapidly effected; and down to the commencement of 1858, the silver was flowing out of France at a very great speed. It would be more than the above large sum, if the depreciation of gold were upwards of one half, or if, being one half only, the silver currency of France had been at the point of departure upwards of 2½ milliards (£ 100,000,000).
The sum of 1,250 millions (£ 50,000,000) is too large to be lightly sacrificed, and yet it is not the loss which seems to me the most to merit our attention. The great danger and the great evil are the anxieties, the uncertainty, and, finally, the injuries which will fall upon a multitude of interests calling for our consideration by their mass, and for our respect by the justice of their case and the sympathy which it excites.