ABSTRACT

The price outlook for any commodity is the resultant of a combination of five unknowns, for example, the price of wheat is determined by: supply of wheat; demand for wheat; supply of gold; demand for gold; the price of gold, and the possibility of establishment of a monetary system not based on gold. If prices were at the pre-war level in gold, the present rate of gold production would probably not be sufficient to maintain that level. As commodity prices rise, processing taxes probably will be discontinued and tariff restrictions on international trade probably will be reduced. The price outlook if gold is demonetized.—If some other unit than gold is used as the measure of value, or if silver is made a part of the measure of value, the price level will of course be affected in accordance with the value of the new unit established. Prosperity is not the result of having either high or low prices.