At the beginning of this second period, 1851, the Bank of France held in its reserves approximately only 3 1⁄2 millions sterling of gold, whereas its silver amounted to more than 19 millions. At the close of the period indicated, 1866, the bank was holding 23 millions sterling of gold against nearly 5 1⁄2 millions of silver. In the former case the proportion of silver formed 85 per cent. of the total, in the latter only 19 per cent.
TABLE OF THE RESERVES OF THE BANK OF FRANCE, 1851-76.
| Year. | Gold (Million Francs). | Silver (Million Francs). | Percent of Silver to Total. | Year. | Gold (Million Francs). | Silver (Million Francs). | Percent of Silver to Total. | |
|---|---|---|---|---|---|---|---|---|
| 1851 | 83 | 478 | 85 | 1864 | 273 | 94 | 27 | |
| 1852 | 69 | 442 | 86 | 1865 | 238 | 208 | 44 | |
| 1853 | 102 | 214 | 67 | 1866 | 576 | 136 | 19 | |
| 1854 | 301 | 193 | 39 | 1867 | 697 | 318 | 31 | |
| 1855 | 72 | 147 | 66 | 1868 | 662 | 474 | 42 | |
| 1856 | 94 | 104 | 53 | 1869 | 461 | 798 | 63 | |
| 1857 | 110 | 126 | 52 | 1870 | 429 | 69 | 14 | |
| 1858 | 294 | 260 | 47 | 1871 | 554 | 80 | 13 | |
| 1859 | 250 | 329 | 56 | 1872 | 656 | 134 | 17 | |
| 1860 | 144 | 272 | 65 | 1873 | 611 | 148 | 19 | |
| 1861 | 225 | 100 | 30 | 1874 | 1013 | 314 | 24 | |
| 1862 | 187 | 108 | 36 | 1875 | 1168 | 504 | 30 | |
| 1863 | 119 | 72 | 37 | 1876 | 1349 | 540 | 28 1⁄2 |
The statistics of the Latin Union, up to the suspension of the bimetallic system will be separately dealt with.
Speaking only of the experience of France during these years of bimetallic régime, the ebbing and
flowing experience which has throughout been instanced as the chief characteristic of such régime is most strongly marked. The legal ratio did not give the market ratio, and so far was it from giving France a stable currency, it was the one thing which unsettled it and made a stable currency impossible. The exposé des motifs of the law of 1876, which will be referred to in another connection below, puts the matter with official brevity. "The variations of the commercial from legal 15 1⁄2 ratio remained normal during the years 1824-67. All the same they sufficed to modify greatly the composition of the French circulation. After the predominance of silver, which became marked in 1847, the ratio from 1847-67 introduced gold in a large proportion, and measures had to be taken to retain in France the smaller silver coinage. Our silver monnaie d'appoint of .835 fine was created for this purpose."
To regard this question from a theoretic and international point of view, to the exclusion of any regard for the separate national interests of France, is a sheer absurdity. It mattered little or nothing to France that by unloading the stores of silver she happened to possess at the time of the gold discoveries of the Fifties she helped to steady the ratio for the world at large. It did however matter, and very much, that this process of exchange from the one metal to the other was attended with public loss, balanced only by illicit private gain, and with a disturbance of trade in every town of France
through the disappearance of the smaller silver specie. Whether or not France or any other country is called upon to sacrifice herself thus—not once but every time the ratio fluctuates from below to above the legal ratio or vice versa—for the sake of an ideal, bimetallic, regulating, function, let common sense decide.
The French monetary commission of 1867 speaks thus of the situation—
"It is well known by all that this ratio [of 1803] by the simple reason of its being fixed could not remain correct. There was quickly a premium on gold, and silver remained almost alone in circulation until near 1850. The discovery of the mines of California and Australia suddenly changed this situation by throwing into the European market a very considerable quantity of gold. By the side of this force, which tended to create a divergence from the legal ratio by lowering gold, there was another which occasioned a rise of silver. Under the influence of various circumstances, too long to enumerate, the needs of the extreme East had grown in unusual proportions, and as silver is alone in favour there, it was exported in enormous masses. There was a premium on silver to the extent of 8 per mille, and it disappeared almost completely from circulation, yielding place to gold.