------------ EH.NET BOOK REVIEW -------------- Published by EH.NET (December 2004) Mark Duckenfield, editor, _The Monetary History of Gold: A Documentary History, 1660-1999_. London: Pickering & Chatto, 2004. xix + 536 pp. =A399/$160 (hardcover), ISBN: 1-85196-785-0. Reviewed for EH.NET by Lawrence H. Officer, Department of Economics, University of Illinois at Chicago. A Review Article [This review article contains several tables, which can't be displayed properly in plain text. The tables can be viewed in the archived copy at http://www.eh.net/bookreviews/library/0878.shtml.] A new collection of historical documents is always welcomed by scholars. This is especially so if the collection is theme-oriented, so that specialists can acquire new information or readier access to existing information. Therefore the present volume, presented as a documentary history of gold, warrants careful review. The editor, Mark Duckenfield, explains that the project was financed by the World Gold Council's Public Policy Centre "to raise awareness among journalists, scholars and the informed public of gold's role as a monetary asset" (p. xvii). This review will be concerned solely with the book's place in the scholarly literature. What is the World Gold Council? According to its website (http://www.jewelrynet.com/WorldGold/), "the World Gold Council is a non-profit association of the world's leading gold producers, established to promote the use of gold ... and its promotional activities cover markets representing some three quarters of the world's annual consumption of gold." It is interesting, therefore, that the volume contains no documents that deal with gold production, gold consumption, or gold investment. Indeed, these categories do not even enter the index, which, at over eleven pages, is not short. Only in one editorial passage does the editor discuss the role of gold as an investment. Duckenfield sees gold and the stock market as investment alternatives, and observes that "the stock market's decline since 1999, as well as the increase in international tensions as a result of the terrorist attack on the World Trade Center in New York on 11 September 2001 and the second Gulf War in 2003, brought a resurgence in the gold market as investors returned to gold as a traditional safe-haven in troubled times" (p. 327). He explicitly states that "gold ... [is] a non-interest bearing asset." Notwithstanding the sponsorship, this is a book that adopts a scholarly viewpoint and can be appreciated by historians. In this review the book is placed in context with existing collections of historical documents that have the same, gold-oriented, theme -- in whole or in part. These books are listed in Table 1, in chronological order; full citations are provided in the references at the end of this review. [ Table 1 is available at http://www.eh.net/bookreviews/library/0878.shtml#Table1 ] In terms of absolute size Duckenfield is in the middle of the pack, fourth out of seven in total pagination. With 100-percent devotion to documents, the book's relative size in this respect is shared by only two other collections: Huntington and Mawhinney (subsequently referenced as "Huntington") and the massive, four-volume work of Krooss. Considering the other books in Table 1, what else is in them apart from historical documents and associated editorial commentary? U.S. Senate contains proceedings of the International Monetary Conference of 1878. These are presented as contemporary recording rather than historical documentation; therefore these proceedings are not included in the historical document pagination. Horton and Laughlin are each mainly a monetary treatise. Shrigley offers non-document information, quantitative and qualitative, on gold and the Bank of England (of which, more below). It may be noted that S. Dana Horton, a U.S. delegate to international monetary conferences, not only authored and edited the historical documents in Horton (1887) but also had been responsible for the historical documents included in U.S. Senate (1879). Table 2 summarizes the anatomy of Duckenfield and the six other works. In Table 1 all historical documents are included to obtain the page count; in Table 2 only those documents that fall within categories covered by Duckenfield are incorporated. (These are called "pertinent documents," in this review.) Some judgment on the part of this reviewer is involved. For example, Duckenfield has one document pertaining to the greenback period as a suspension of specie payments; documents under that category are included for the other works. An opposite example: Duckenfield has a document on goldsmith banking; this reviewer judges that insufficient to incorporate the category "commercial banking." Again, measured by number of documents, Duckenfield is fourth among the seven collections. [ Table 2 is available at http://www.eh.net/bookreviews/library/0878.shtml#Table2 ] All the collections except Shrigley are divided into sections, some chronological, some by country, some by topic, as Table 2 shows. Only two of the works have systematic subsections. Within sections and subsections, ordering is uniformly chronological. Regarding editorial commentary, Duckenfield is unique, and deserves praise, for having editorial introductions in all three manifestations: for the entire volume, by section, and for the individual documents within each section. Because entries in a collected volume of documents generally are excerpts rather than the entire documents, this reviewer appreciates Duckenfield's practice of calling attention to non-reprinted parts of documents. The three sections of Duckenfield warrant discussion, here in the context of editorial commentary. The introduction to the first, "The Rise of the Gold Standard, 1660-1819," is concerned entirely with British monetary history. Duckenfield observes England's movement from bimetallism to a de facto gold standard in 1717. He notes the interruption of the Bank Restriction Period in this process. It is reasonable to confine discussion to Britain, because it was the only country on a gold standard well into the nineteenth century. However, it would have been in order to discuss the bimetallist systems of other countries. The second section, "The Heyday of the Gold Standard, 1820-1930," has a broader introduction, including topics such as the expansion of the gold standard, the price specie-flow mechanism, the U.S. shift from an effective silver to an effective gold standard (with the interruption of the greenback period), the deflation of 1873-1896, and London as the center of the gold standard. The end of the classical gold standard with World War I is noted, as is the return to the standard after the war. Duckenfield discusses the issue of convertibility but can be criticized for ignoring that of credibility (of countries' commitment to convertibility at the existing mint price), which underlay the success of the classical gold standard. In his introduction to the third section, "After the Gold Standard, 1931-1999," Duckenfield sees a weak institutional structure as the cause of instability of the interwar gold standard. "Domestic social tensions" and the "prospect of substantial budget deficits" drove countries off the gold standard. War and "new social realities" meant that political and economic institutions that supported the gold standard could not overcome political demands that occurred during the Great Depression. Again, reference to the issue of credibility, now the lack thereof, in government's commitment to convertibility would have been in order. The introduction also discusses the International Monetary Fund, the role of the dollar, and the "Triffin dilemma" (the trade-off between liquidity and confidence). On the U.S. suspension of gold convertibility in 1971, Duckenfield writes: "Ironically, although it was the weakness of the dollar relative to gold that brought about the collapse of the Bretton Woods system, it was gold that was removed from its primary position as a monetary asset while the devalued dollar became even more crucial to the smooth operation of the international economy" (pp. 326-327). It can be argued, rather, that it was U.S. commitment to a fixed dollar price of gold that artificially made gold the first class monetary asset. Table 3 divides the pertinent documents of each work into chronological sections (pre 1820, 1820-1930, post-1930) corresponding to the Duckenfield partitioning, except that Horton's original partitioning is retained, because it is so close to that of Duckenfield chronologically. Of course, the four documents antedating Shrigley lack the third (post 1930) section, because of the date of publication. [ Table 3 is available at http://www.eh.net/bookreviews/library/0878.shtml#Table3 ] What are the components of official versus private documents? Official documents consist of country and international items. Country official documents include acts, resolutions, announcements, reports, memoranda, communications, statements, declarations, representations, speeches, notes on petitions, parliamentary diaries, proclamations, mint correspondence, and press conferences. International documents (all official) consist of treaties, conventions, resolutions, agreements, press releases, communiqu=E9s, and decisions. Private documents include treatises, books, pamphlets, diaries, discourses, petitions, speeches, reports, correspondence, memoirs, newspaper articles, and memoranda. As one would expect in collections of documents, the vast majority of documents are official, in all the works. Duckenfield is unique in having private documents constitute a significant proportion -- over one-third the total number -- of documents in the pre-1820 period. Table 4 offers an alternative division of pertinent documents -- by country (Britain, United States, other countries), with international as a separate category. For private documents, the subject country is taken. For official documents, the country category is the country of the official document rather than the subject country or countries. All seven works concentrate on Britain and/or the United States. Huntington and Krooss deal only with the United States, Shrigley only with Britain. Laughlin has U.S., other-country, and international -- but not British -- documents; while Horton includes only British and international documents. The only works with documents in each category are the earliest and latest: U.S. Senate and Duckenfield. As would be expected, U.S. Senate has somewhat more U.S. than British documents overall (but not for the pre-1820 period). [ Table 4 is available at http://www.eh.net/bookreviews/library/0878.shtml#Table4 ] One would predict a balanced British/U.S. division on the part of Duckenfield, given that neither the book-title nor the sponsor is specific-country oriented. Then one would be disappointed, because a British emphasis is present in every period. The asymmetry is apparent in several ways: 1. There are nine documents of the Bank Restriction Period but only three from the greenback period and nothing on other U.S. suspensions of specie payments. 2. There is an entry for the Bank of England charter, but not for the Federal Reserve Act. 3. There are more entries for Acts of Parliament than for U.S. legislatio= n. 4. The British Coinage Act of 1870 is reprinted in full; not so the U.S. Coinage Act of 1873, which admittedly is a longer Act. In fairness to Duckenfield, it should be noted that, while Winston Churchill's famous Budget Speech of 1925 returning the United Kingdom to the gold standard is excerpted, William Jennings Bryan's at least equally famous "Cross of Gold" Speech is reprinted in full. Also, there are many entries involving U.S. abandonment of the gold standard in 1933-1934. Notwithstanding the generally British orientation of Duckenfield, Horton is the better source for material on the history of the guinea -- perhaps the most famous coin in British history, and, along with the (new) sovereign introduced in 1817, one of the country's two most important coins. Only seven of Horton's 31 documents on the guinea are included in Duckenfield. The guinea is notable as a coin for two reasons. First, its initial value of 20 shillings corresponded to the pound sterling. Interestingly, the guinea was not the first coin with this property; that distinction belongs to the old sovereign, introduced in 1489. Second, the fineness of 11/12th was firmly established with the guinea (and continuing with the new sovereign); but again the guinea was not the first coin with that fineness (that honor belonging to the crown in 1526). Shrigley, totally specialized on Britain, has a specific theme within gold. She writes: "The purpose of this collection of documents is to show the official position of gold as a marketable commodity from the Incorporation of the Bank of England to the Gold Standard (Amendment) Act of 1931" (p. vii). Of her 20 documents, 12 are not in Duckenfield. Table 5 breaks down the "other-countries" category of Table 4 into specific countries. Duckenfield does not provide a rationale for his concentration on Switzerland in the 1920-1930 and post-1930 periods in this respect, nor for inclusion of material on countries such as Chile and Yugoslavia post-1930. It is also arguable that France and Germany deserve greater attention than all three works give these countries. [ Table 5 is available at http://www.eh.net/bookreviews/library/0878.shtml#Table5 ] Table 6, similarly, partitions the "international" category of Table 4. Duckenfield can perhaps be criticized for neglecting the international monetary conferences of the nineteenth century. Yet he deserves praise for including the, post-World War I, Treaty of Versailles -- relevant because of the gold-denomination of the monetary obligations imposed on Germany. [ Table 6 is available at http://www.eh.net/bookreviews/library/0878.shtml#Table6 ] Duckenfield deserves praise on a number of counts. First, for some documents, the contents of appendices are listed. (Indeed, that is sometimes the full text of the entry.) These contents can be useful references for the scholar. Second, Duckenfield makes use of generally neglected sources: Bank of England archives and the House of Lords Record Office. Third, some documents may be new to historians. Examples: a "confidential telegram" (one of many) sent on September 20, 1931, from the Bank of England to domestic and foreign correspondents; the Rothschild letter on fixing the price of gold in 1939, just prior to World War II. A serious limitation of the Duckenfield volume is the neglect of quantitative information. Only three documents have a quantitative aspect: the original Articles of Agreement of the IMF, which contains the list of country quotas; the IMF Executive Board decision on the Smithsonian Agreement which lists exchange rates for member countries; and, perhaps most interesting to historians because probably not available elsewhere, three documents from the Bank of England's Archives providing data on gold holdings of countries occupied by Germany, in 1940. In contrast, the documents in U.S. Senate contain many useful tables on U.S. exchange rates, gold and silver prices, and coinage. Shrigley presents several useful time series (which are not included in the list of her documents, in Tables 2-4): the annual gold-silver market price ratio, 1867-1932; the London market price of gold, annual 1870-1932, daily 1919-1925; and the London market price of silver, monthly 1833-1933. The last is an insert at the end of the book, and includes also annual data on silver coined in England, the amount of bills and telegraphic transfers drawn in England on Indian governments, exports of silver to the East, imports of silver, average Bank Rate, and remarks (generally historical). It is a large and impressive table, which, unfortunately, because not attached to the volume, may be missing from many copies. Not a time series, but nevertheless useful, is a list of Governors of the Bank of England from inception to 1920, along with dates of service. In conclusion, the Duckenfield volume is a useful addition to collections of historical documents on gold, and would be best utilized by scholars in conjunction with existing works of a similar ilk. References: Horton, S. Dana (1887). _The Silver Pound and England's Monetary Policy since the Restoration, together with the History of the Guinea, illustrated by contemporary documents_. London: Macmillan. Huntington, A. T., and Robert J. Mawhinney, eds. (1910). _Laws of the United States Concerning Money, Banking, and Loans, 1778-1909_. National Monetary Commission, Senate Document No. 580, 61st Congress, 2nd session. Washington: Government Printing Office. Krooss, Herman E., ed. (1969). _Documentary History of Banking and Currency in the United States_, four volumes. New York: Chelsea House in association with McGraw-Hill. Lauglin, J. Laurence (1896). _The History of Bimetallism in the United States_. New York: D. Appleton. Shrigley, Irene, ed. (1935). _The Price of Gold: Documents Illustrating the Statutory Control through the Bank of England of the Market Price of Gold, 1694-1931_. London: P.S. King & Son. U.S. Senate (1879). _International Monetary Conference=8Aheld=8Ain Paris,= in August 1878, under the auspices of the Ministry of Foreign Affairs of the Republic of France_. Senate Executive Document No. 58, 45th Congress, 3rd session. Washington: Government Printing Office. Lawrence H. Officer is Professor of Economics at University of Illinois at Chicago. As Editor, Special Projects, EH.Net, he has recently completed "What Is Its Relative Value in U.K. Pounds," a calculator available on the EH.Net website (http://www.eh.net/hmit/ukcompare). Copyright (c) 2004 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and EH.Net. For other permission, please contact the EH.Net Administrator ([log in to unmask]; Telephone: 513-529-2229). Published by EH.Net (December 2004). All EH.Net reviews are archived at http://www.eh.net/BookReview. -------------- FOOTER TO EH.NET BOOK REVIEW -------------- EH.Net-Review mailing list [log in to unmask] http://eh.net/mailman/listinfo/eh.net-review