When people actively discuss the precious metals market, most discussions will ultimately be steered in the direction of gold. Silver is often overlooked, even though the Silverites movement certainly tried to change that many moons ago.
An Introduction to Silverites
Over the past few centuries, there have been numerous debates to find a new sort of monetary system. Ultimately, the battle was won by supporters of centralized finance and central banks. Whether that is good or bad for society, is a topic for a different type of debate.
If the Silverites had any say in the matter – and they certainly did in the late-19th century – things could have looked very different. Rather than advocating for paper bills and full control by central banks, they aimed to maintain a monetary standard linked to precious metals. As the name suggests, they had high hopes for silver to co-exist alongside gold in this particular regard.
More specifically, the Silverates aimed to enforce this procedure through the Coinage Act of 1792. Under that act, the coinage of the United States is regulated. It also established the silver dollar as the unit of money in the US, although it was replaced by other coinage later on.
In theory, everything was in place to ensure that silver would have a bright future as a unit of money in the United States. Nothing ever comes easy in life, however, and the vision of the Silverites didn’t come to pass. That doesn’t mean they gave up on the idea that easily, however.
The Silverites and Politics
The best way to get something done in the United States is by leveraging one’s political position. The Silverites certainly explored that angle quite well. Members of this political movement could be found across different parties, including the Democratic Party, Populist Party, and Silver Republican Party.
At one point, the Silverites even had their own Presidential candidate. Willian Jennigns Bryan, credited with the Cross of Gold speech, often lobbied in favor of the movement’s desires and plans. Despite attempting to run for President on multiple occasions, he never succeeded in getting elected.
The Silver-Gold Ratio
In modern finance, the ratio between silver and gold has become a valuable tool to determine overall market sentiment. Not that long ago, it surpassed the 100-to-1 ratio, further indicating that silver would be left behind if the gold price continued to rally.
In their initial proposals, the Silverites wanted to ensure that this ratio would be maintained at 16-to-1. A very ambitious goal, although a similar ratio was effectively established in the Coinage Act of 1834. By maintaining this ratio between the two metals, the Silverites also aimed to allow for inflation of the money supply.
Even today, there will be Silverites among society. While not necessarily adhering to all standards of the late 19th century, there are many who feel that silver should play a more prominent role in the precious metal industry. Following the coronavirus crisis and subsequent financial recession, that vision may yet come to pass in some shape or form.