It may be demanded, what hurt this trade can do to England, since those who export silver bring back the same value in gold? I answer, that were this trade carried on by natives, there would be no loss; because they would bring home gold for the whole intrinsic value of the silver. But if we suppose foreigners sending over gold to be coined at the English mint, and changing that gold into English silver coin, and then carrying off this coin, I think it is plain that they must gain the difference, as well as the money-jobbers. But it may be answered, that having given gold for silver at the rate of the mint, they have given value for what they have received. Very right; but so did Sir Hans Sloane, when he paid five guineas for an overgrown toad: he got value for his money; but it was value only to himself. Just so, whenever the English government shall be obliged to restore the proportion of the metals, (as they must do) this operation will annihilate that imaginary value which they have hitherto set upon gold; which imagination is the only thing which renders the exchange of their silver against the foreign gold equal.
But it is farther objected, that foreigners cannot carry off the heavy silver; because there is none to carry off. Very true; but then I say they have carried off a great quantity already: or if the English Jews have been too sharp to allow such a profit to fall to strangers, (which may or may not have been the case) then I say that this disorder is an effectual stop to any more coinage of silver for circulation.
CHAP. VIII.
Of the disorder in the British coin, so far as it affects the value of the pound sterling currency.
Two legal pounds sterling in England.
From what has been said, it is evident, that there must be found in England two legal pounds sterling, of different values; the one worth 113 grains of fine gold, the other worth 1718.7 grains of fine silver. I call them different; because these two portions of the precious metals are of different values all over Europe.
And several others, in consequence of the wearing of the coin.
But besides these two different pounds sterling, which the change in the proportion of the metals have created, the other defects of the circulating coin produce similar effects. The guineas coined by all the Princes since K. Charles II. have been of the same standard weight and fineness, 44½ in a pound troy of standard gold 11⁄12 fine: these have been constantly wearing ever since they have been coined; and in proportion to their wearing they are of less value.
If, therefore, the new guineas are below the value of a pound sterling in silver, standard weight, the old must be of less value still. Here then is another currency, that is, another pound sterling; or indeed more properly speaking, there are as many different pounds sterling as there are guineas of different weights. This is not all; the money-jobbers having carried off all the weighty silver, that which is worn with use, and reduced even below the standard of gold, forms one currency more, and totally destroys all determinate proportion between the money-unit and the currencies which are supposed to represent it.
Why any silver coin remains in England.