Considering the low production of silver in relation to the production of other commodities, the, probable stoppage of the previous 1 Temonetisations of silver, and its possible remonetisation, the general futloae is thatthe purchasing power silver will probably continue to vise, "The reason for the tremendous decline in the purchasing power of silver in the world during the period 11887 to 1981 was the rapid demonetisation of silver which took place just prior to and during that period. The "demonetised silver was con-the tinually being, sold, jereasing the supply available for other, uses and for monetary uses. inn decreasing number of countries. During lod 1902 to 1922, this clemonet Hon Was so rapid that the Chinese price level rose at about the same Fate as estimated world stocks of silver, In more recent years, a especially large amount of demonetised sliver was sold, and until the middle of 1931 the Chinese price evel rose much faster than the world stocks of silver increased, Silver Agreement. the summer of 1933, a provisional agreement designed to increase the value of silver was signed Jat London by representatives of nine countries. If ratified, this agree: nent would provide, in effect, that the total amount of silver sold by Ube important silver holding count: vies of India, and Spein during the next four' years would bbe 160,000,000 ounces, Tt would also provide that the important silver producing counties of Mexico, Pera, livin, Australia, Canada, and the United' States would purchase and impound in their central banks and eceasuries 140,000,000 ounces of their newly mined silver during the same four years. During the thi-teen years, 1920 to 1932, an average of more than 41.5 million ounces of demonetised silver was sold annually by' governments and central bank 1¢- proposed arrangement. repre: ents & real relative increase in the demand for silver, since. it provides fan offset to the sale of all except 5 million ounces of silver annual Much agitation now exists for actual remonetisation of silver in Mexico, the United States, and South American countries public opinion scorns to proposals.
Tm "general, the outlook sufficient demonetization of silver in the future to hold the purchasing Power of silver down and to. hold the Chinese price level up is rather small.
During the long period when the purchasing power of silver was decreasing, the index of world stocks of silver Ingzed far behind the index of the workd's physical volume of production of basic commodities, as compiled by Carl Snyder. From 1864 to 1914, the index of world [production of commodities increased the rate of 3.15\per cent. per The war period caused a tom-decline 1h the world's com.
ity. production, but, the usual vote of increase was beginning to be resumed. when the depression of 1920 again called a halt in the Normal Production As the world recovers from the depression, the normal rate of inferease in' the production of commodities will probably be resumed. In order for silver to maintain a stable purchasing: power, it is probable that its annual production should be about 3.15 per cent, of the previous year's stocks, assuming no change la monetary uses. At eatimated world stocks in 1982, an annual production of about 479,000, 000 ounces would-be required. The
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