The significant factor of commercial control in the pyrite situation is the large investment of British capital in the Spanish deposits and to a less extent the investment of French capital. United States capital controls the principal pyrite developments in Canada, Cuba, Mexico and Cyprus. English, French and Swedish capital is invested in Norway.
POSITION OF THE PRINCIPAL POWERS
The United States is the most favorably situated of any nation in its supply of sulphur. In the years preceding the European war it produced about one-half the world’s supply. Since that time its production has increased several fold and it is now the dominating factor in the world situation.
The relative position of Italy, which was formerly of equal importance with the United States, is declining. Her cost of production is increasing, and American sulphur will enter into keen competition with the European markets. The resources of Japan are comparatively small and the larger part of her production has been exported. The post-war conditions will probably curtail the markets for Japanese sulphur, and there is no likelihood of any increase in Japan’s position. England, France and Germany must primarily rely upon other countries for their supply of both pyrite and sulphur. England secures a part of her sulphur supply from a by-product source known as the Chance-Claus process, which produces from 30 to 40 thousand tons annually. In addition she secures large amounts of pyrite from Spain. France produces some local pyrite, but imports large quantities of this material from Spain; and before the outbreak of the war was securing increasing amounts of sulphur from the United States. Germany and Austria have some resources in pyrite and probably had considerable stocks of sulphur at the opening of the war. It has been stated that in order to secure her needs of these materials Germany was forced to use expensive processes, to reduce the sulphur content of gypsum, to expand her pyrite production, and to increase the output of smelter acid. Under normal conditions she will probably have to return to imports of pyrite from Norway and Sweden, or sulphur from the United States and Italy.
CHAPTER XXIX
GOLD
By John E. Orchard
USES OF GOLD
The physical properties of gold and the difficulties connected with obtaining it have made gold through all the ages one of the most precious of the metals. Because of its luster, its color, and its indestructibility, it was shaped by primitive man into rings, bracelets, and other ornaments. These same properties, together with its divisibility, early led to the use of gold as a trading counter, and in all but the most primitive societies it has been regarded as a measure of value and a medium of exchange. The earliest known reference to gold is a reference to its use in trade, and is contained in an edict of Menes of Egypt (perhaps 3800 B. C.) fixing the ratio of the value of gold to silver at 2¹⁄₂ to 1.
As a medium of exchange gold is used in a variety of forms. The primitive trader accepted and gave ornaments of gold in exchange for commodities. In mining camps, gold dust and nuggets have been the circulating medium. In a settled community under a government possessing the confidence of the governed, gold coined into counters of convenient denominations by the government is accepted without question in all transactions. For the settlement of balances in international trade, gold bullion is used, its value being determined by weight. Today practically all nations are on a gold standard, and even those on a silver standard in domestic trade have adopted the gold standard for foreign trade.
But gold, though it has many excellent qualities, is one of the heaviest of metals, and carrying it on the person is inconvenient, especially in amounts sufficient for large transactions. Also, through constant handling, gold wears away and coins deteriorate in value. Accordingly a large part of the coins or the gold bullion is kept in the national treasury or in the vaults of a bank, and some form of paper currency is used as the circulating medium. Upon this reserve of gold, seen only by a few employees of the government or bank, who have no ownership in it, is built an intricate system of credits and trade.
It is true that little gold is in actual circulation and that for domestic trade mediums of exchange secured only in part by gold are being used in increasing amounts. Even international exchange is no longer on the gold standard, but this situation is undoubtedly temporary and with the improvement in financial conditions in Europe gold will be restored to its position as foundation of trade and finance, national and international. The circulating medium, whatever its nature, must be freely convertible, and credit, to remain sound, must be founded upon an adequate gold reserve.