rapid displacement of
prevailing prices in all quarters of the industrial world. The price
of manufacturer's products rose in advance of the rise of costs of
many raw materials and especially of the labor costs of manufacture.
The average enterpriser's gain was the average wage-worker's loss.
Wages (and salaries), as nearly always in the case of a change of
price levels, moved more slowly than did the prices of most of the
commodities which are bought with wages, thus causing great hardship
to large classes living on comparatively slowly moving incomes.[19]
Extremes meet, and these classes include both those living on
passive investments, and those dependent on their daily labor for a
livelihood.

Thus we escape the evils of a rising standard of deferred payments,
only to meet those of a falling standard. And as long as we have so
fluctuating a standard these difficulties must arise again and
again, continually repeated, causing unmerited gains and losses
to individuals. Let us conclude with a brief consideration of the
fundamental principles involved in this problem.

Sec. 13. #Defectiveness of the gold standard#. Money is, in general, for
both borrowers and lenders the most convenient standard of deferred
payments. But from the usage of speaking of all things in terms of
gold, arises the popular notion that the value of gold is always
the same, while the value of other things changes. In truth, a fixed
objective standard of value is not possible of attainment. Altho the
value of gold is stable as compared with most things, it rests on the
estimates made by men and is constantly changing with conditions. The
current new supplies of gold are comparatively regular. For centuries
at a time there was little change in the methods of mining gold and
there were no radical changes in its output. The nature of the use of
gold, likewise, is such as to made changes in the amount of it needed,
under ordinary conditions, more stable than is that of most other
goods. Moreover, the stock of gold in monetary uses is but slowly
worn out; it is, therefore, a large reservoir into which flows a
comparatively small stream of annual production; the existing stock
is twenty or thirty times the annual output. Yet the value of gold
expressed in other things is never quite stable, and sometimes
several influences combine to affect it greatly and suddenly. Recent
inventions, chemical and mechanical, moreover, have considerably
altered the co