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Statement of earnings and expenditures of the mints and assay-offices of the United States for the fiscal year ended June 30, 1877.
COINAGE EXECUTED FOR THE GOVERNMENT OF VENEZUELA.
Early in the last fiscal year the following coins, composed of an alloy of copper, nickel, and zinc, were struck at the mint in Philadelphia for the Government of Venezuela, viz:
10,000,000 pieces of “un centavo," of the nominal value of $100,000.
2,000,000 pieces of “dos y medio centavos," of the nominal value of $50,000.
The planchets for these coins were prepared by private enterprise at the expense of the agent of the above-named government, and the coins were simply stamped at the mint, the expense of which oper. ation was paid to the mint, and afterward into the Treasury of the United States. The stamping of these pieces did not in any way interfere with the regular coinage operations,
ASSAY OF FOREIGN COINS.
During the year various gold and silver foreign coins bave been assayed
mints of Philadelphia and San Francisco and assay-office at New York. The results furnished exbibit the actual weight and fineness of the sereral coins, as determined by our trials, and not the standard weight and fineness prescribed by the laws of the respective countries.
Samples of the annual pyx coins of the imperial mint at Osaka were assayed at the mint in Philadelphia by request of the Japanese minister, and the results confirmed the assays made at the Japan mint, and also showed the closeness to which the coins of that empire conform to the legal standard for fineness.
INTRODUCTION OF AUTOMATIC WEIGHING-MACHINES.
Gold coins and trade dollars are the only pieces singly adjusted and weighed by hand, dependence being placed upon the draw-bench to insure a uniformity in the thickness of the rolled strips from which the blanks for the fractional coins are cut.
The legal deviation from standard weight on these fractioual coins is three times as great as that on the gold coin, the evident intention of the law being that the adjustment should be made by machinery, and the delay and expense attending adjustment of single pieces by hand avoided. Experience has demonstrated that this method cannot always be relied upon to secure a uniform adjustment of these pieces within the limit of deviation allowed by law. At the first session of the Forty-fourth Congress an appropriation was made for procuring automatic weighing and assorting machines, and two were accordingly ordered from Seyss & Co., Atzgersdorf, near Vienna, for the use of the mint at Philadelphia, and one manufactured by Napier & Son, of London, for the mint at San Francisco. The machines imported from Austria have been in constant use and with very satisfactory results. They have been employed mainly on the half dollar planchets, and their combined capacity is about one bundred and sixty blanks per minute. Those outside of the legal tolerance are invariably detected and automatically separated from the others.
Owing to delay in the receipt of the Napier machine, it has only lately been erected at the mint at San Francisco, and has been partially tested upon the small gold coins. The rate of adjustment is about 40 blanks per minute, but the results are equally as satisfactory as those from the Seyss machine.
The use of these machines has demonstrated the fact that without tbe employment of some such safeguard, a small percentage of fractional coins, slightly beyond the legal tolerance for weight, may escape observation and pass into circulation.
An appropriation should be procured to supply the mints with a sufficient number of these machines to test all the blanks for fractional coins.
The building occupied as an assay-office in Denver, Colo., was orignally purchased from private parties and enlarged by the government. From settling of the foundations it has become dilapidated to an extent render. ing it unsafe and unsuitable to occupy much longer for melting and assaying purposes. The propriety of procuring an appropriation sufficient to construct a new assay-office at Denver, after the plan of the one recently constructed at Helena, Mont., is presented for your consideration.
ASSAY OFFICE AT HIELENA AND MINT AT NEW ORLEANS.
Soon after the close of the fiscal year ended June 30, 1876, the building erected for an assay-office at Helena, Mont., was completed, and it was formally opened for the reception of deposits for melt and assay October 23, 1876, since when the amount of business transacted bas steadily been on the increase.
An appropriation having been made for the purpose of reopening the mint at New Orleans as an assay-office, the pecessary repairs and preparations were made and operations commenced January 15, 1877. The number and amount of deposits received bave been inconsiderable, being principally confined to old plate and jewelry.
The square of ground upon which the mint building was erected was, by a resolution of the city council of New Orleans, approved May 11, 1835, ceded to the United States for the express and only purpose of erecting thereon a branch of the Mint of the United States, together with the necessary appendages ;” and that “should it hereafter be deemed necessary by the Government of the United States to remore the mint contemplated to be established, as aforesaid, or to cease to occupy it for such purposes, then the said act to be pull and void.”
Measures bave been taken baving for their object the reversion of this square of ground to the city of New Orleans, and it is understood have been held in abeyance only by a prospect of the mint being reopened as a coinage inint. In the event of a silver dollar being authorized by Congress to be coined, and additional coining facilities be required, the facts in connection with this subject should be considered.
WITHDRAWAL OF CERTAIN THREE-CENT SILVER COINS FROM CIR
There are in circulation some of the three-cent silver picces coined prior to March 3, 1853, which are only seven hundred and fifty thousandths fine. These coins were issued under the provisions of the act of March 3, 1851, for postal-currency purposes, and wbich fixed their fineness as above stated. The standard for this denomination was increased to pine hundred thousandths fine by the act of March 3, 1853. The standard for the gold and silver coins being nine hundred thou. sandths, those of the fineness of seven hundred and fifty thousandths
should be called in, especially as they are much worn. The propriety of procuring legislation for the withdrawal of these coins from circula. tion is submitted for your consideration.
The purchases of silver bullion for the fractional coinage from January, 1875 to June 30, 1877, amounted to 25,619,212.23 fine ounces, at a cost of $30,456,599.35, or an average cost per ounce fine of 118,6 cents. The average London rate during that period was 54.77083 pence per ounce, British standard, equivalent to $1.20,06 per ounce fine.
From July 1 to October 31, 1877, the government purchased 3,088,122.34 fine ounces, at a cost of $3,662,373.91, or an average cost per ounce fine of 118 - cents. The average London rate during that period was 543 pence, or 119% cents per ounce fine.
The total purchases of silver bullion made by the government from January, 1875, to October 31, 1877, i nclusive, were 28,707,634.57 fine ounces, at a total cost of $34,118,973.26, or an average cost of 118.8 cents per ounce fine. During that period the London rate averaged 54.7656 pence, or $1.20,05 per ounce fine. The purchases were therefore obtained by the government at 13o cents lower than the equivalent of the average Londou rate.
The total bullion purchased, 28,707,631.57 fine, or 31,897,371.73 standard ounces, costing $34,118,973.26, will produce, at the coining rate of $1,24.4168 per standard ounce, fractional silver coins to the amount of $39,685,688, and give a seigniorage or gain of $5,566,714.74.
In procuring this silver, the rule as to price has always been to purchase as much below the equivalent of the London rate as possible, and not above it if it could be avoided.
The largest purchases bave been made either after a heavy decline in price or on a declining market. After our heavy purchases in July, 1876, at the equivalents of 47, 473, and 48 pence, the price advanced within thirty days to 537 pence; and again in October and November of the same year, when large purchases were made at about 531, 53, and 544 pence, the price soon after rapidly advanced, reaching by December 14, 584 pence. In only a single instance did the price decline after a considerable purchase. That was toward the close of February, 1877, when purchases were made at about 56 pence. The price afterward gradually declined to 53.1 pence. Purchases were continued as the market declined and an average price of about 54 pence secured. The decline in this instance was caused by free sales by the German Gov. ernment and a simultaneous intermission of the demand for export to China and the indies, and of which we had no information. It should be noted that for some time in the autumn of the year 1876 the demand at San Francisco for export to China was so great as to carry the price of silver in that city nearly two cents an ounce above the equivalent of the London rate, and rendered necessary a resort indirectly to the Lon. don market for a moderate supply to meet our coinage requirements.
An examination made by the Treasury commission in San Francisco in relation to the purchases of silver for the fractional coinage brought out some valuable information in relation to the exports of silver to India and China, the effect upon the price in that city as compared with London and New York, and the cross-exchanges counected therewith. This information is contained in the appendix.
REFINING AND PARTING OF BULLION. The act making appropriations for the legislative, executive, and judi
cial expenses of the government for the year ended June 30, 1877, and for other purposes, contained the following:
“And refining and parting of bullion shall be carried on at the mints in the United States and the assay-office, New York; and it shall be lawful to apply the moneys arising from charges collected from deposit. ors for these operations, pursuant to law, to the defraying in full of the expenses thereof, including labor, materials, and wastage; but no part of moneys otherwise appropriated for the support of the mints and assay-office at New York shall be used to defray the expenses of refining and parting bullion."
This law was re-enacted in the general appropriation act for the fiscal year ending June 30, 1878. Under its provisions the expenses of parting and refining at the different mints and assay-office, New York, hare to be defrayed out of the funds arising from the charges made, and deducted from deposits requiring these operations, which charges are required to be fixed from time to time by the Director of the Mint, with the approval of the Secretary of the Treasury, so as to equal, but not exceed, in their judgment, the cost of these operations respectively, including wastage, materials, and labor. The money arising from this source is paid into the Treasury of the United States to the credit of the refining account, and afterward drawn out by requisitions, the same as the regular appropriations, and expended under the laws and regulations governing the mints.
The result of the first year's operations has been to show that the schedule of charges in force at the time the new law took effect have been sufficient to defray the expenses of the several refineries, including necessary repairs. This result has been due, however, in some degree to the government having been able to control, to some extent, the distribution of what is usually termed doré bullion, i. e., silver bullion containing gold in partable quantity, through its purchases, from time to time, for the fractional silver coinage.
Without the necessary supply of this class of bullion there will be difficulty in future in executing this law at the San Francisco and Carson mints, for the reason that gold deposits containing small percentages of silver cannot be parted at the present rate of charges unless doré sil. ver, containing from 5 to 15 per cent. of gold, be added, sufficient to give a mixture suitable for economical parting. Without this the charge for parting gold bullion would have to be increased, which would practically exclude it from the mint.
The experience of the last few months shows that when there is but a limited demand for trade dollars for export, and the government is not buying doré bullion, very small quantities of the latter are deposited at the mints; meanwhile, it becomes necessary to either reduce the working force employed in the refineries or suspend the pay of the workmen. Should this continue for any length of time, it may be difficult to retain skilled workmen.
The practicability of executing the law in future will depend very much upon the character of the legislation which may be enacted in relation to silver coinage.
EARNINGS, EXPENSES, AND OPERATIONS OF THE MINTS, FROM JULY,
1849, TO JUNE 30, 1877.
For comparison as to the cost of coinage in different years and for other useful purposes in connection with the various operations and processes employed in the coinage, statements have been prepared