Richard Kerschagl’s monograph examines silver’s monetary decline and the international proposals to reverse it during the world economic crisis. Its five substantive sections move from monetary history through extensive production, price, and consumption statistics to a survey of remonetization schemes, conceptual analysis, and policy recommendations. Its central argument separates the stabilization of currencies from the rescue of silver producers and holders: restoring silver’s monetary privileges would complicate international monetary relations without reliably restoring prosperity.
The historical survey traces the retreat from silver through gold-standard adoption, restrictions on coinage, wartime price increases, and subsequent demonetization, particularly in India and other Asian territories. The statistical section establishes both the scale of the problem and the limits of knowledge. Production figures cannot establish market supply when accumulated stocks and private hoards may reappear unpredictably. Nor does a relatively stable physical ratio between gold and silver production imply a stable value ratio. Kerschagl consequently reframes the apparent monetary emergency:
Das Problem der Silberstabilisierung ist daher ein Problem der Stabilisierung eines Preises.
English translation: The problem of stabilizing silver is therefore a problem of stabilizing a price.
This formulation challenges claims that falling silver prices caused the world depression. Depreciation can diminish wealth and impair international purchasing power, but these effects do not establish a direct causal relationship between silver and the general price level. Monetary institutions matter: once unrestricted coinage ends, the currency’s value need not follow the metal’s price.
Kerschagl gives competing proposals substantial space, often reproducing their advocates’ arguments. These include American congressional initiatives and silver loans to China, the International Chamber of Commerce’s recommendations, Darling’s international currency schemes, Kemmerer’s Chinese reform, Gregory’s critique of bimetallism, Hans’s international silver bank, and Kunwald’s and Zucker’s coinage reforms. His differentiated assessment credits Kunwald with identifying the significance of underweight silver coinage and Kemmerer with recognizing the institutional requirements of monetary transition. Yet loans in silver merely relocate the disposal problem, while guaranteed prices and monetary absorption risk recreating bimetallism.
The analytical hinge is the distinction between silver as an unrestrictedly coinable monetary metal, silver coins with unlimited legal-tender power but restricted issuance, and subsidiary coinage. Drawing on Knapp’s terminology, Kerschagl distinguishes the hylisch foundation of money creation from the notal status of monetary tokens. Restricting silver’s monetary admission already turns the system toward managed currency; physical silver then becomes an expensive backing rather than a necessary foundation of stability. Credit expansion, if desired, requires no remonetization of silver.
A second conceptual move joins production economics to the psychology of hoarding. Much silver emerges as a by-product of other metals, limiting the responsiveness of supply to its own price. A cartel would also have to manage stocks accumulated over centuries, not simply future output. Higher prices might attract additional sellers rather than restore lasting confidence:
Kurz gesagt: Man kann nicht den Silberpreis befestigen, ohne gleichzeitig die Silberideologie wieder zu befestigen.
English translation: In short: one cannot stabilize the price of silver without simultaneously restoring faith in silver.
Kerschagl treats confidence as an unresolved empirical question, particularly concerning Asian holders. Agreements between governments cannot fully control private hoards, and a recovery intended to arrest liquidation might instead offer owners an opportunity to sell. This limits both cartel schemes and assertions that governments can simply reverse the depreciation attributed to their earlier policies.
His preferred direction is explicit:
Die Konsequenz dessen ist, daß das Silber sich auf industrielle Verwertung umstellen muß, was ebenso für die Silberproduzenten wie für die Silberbesitzer gilt.
English translation: The consequence is that silver must shift toward industrial utilization, which applies equally to silver producers and silver owners.
That adjustment may entail lower prices, altered cost calculations, and closures of mines producing silver as their principal output. Industrial research, alloys, jewellery, and household goods offer alternative outlets. Transitional silver circulation in Asia and subsidiary coinage remain permissible where acceptance habits justify their costs; temporary international restraints on disposal may soften disruption. These concessions do not change the long-term priority: compatible, stable monetary systems over producer protection. The work’s significance lies in its refusal to equate commodity-price support with monetary reconstruction, and in its warning that creditor power could impose obsolete currency arrangements on Asian borrowers under the guise of assistance.
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