But it must be admitted, that this argument in favour of continuing the existing proportion, is not applicable to the state of the coins with us. There have been too many artificial and heterogeneous ingredients, too much want of order in the pecuniary transactions of this country, to authorise the attributing the effects which have appeared, to the regular operations of commerce. A proof of this is to be drawn from the alterations, which have happened in the proportion between the metals, merely by the successive degradations of the dollar, in consequence of the mutability of a foreign mint. The value of gold to silver appears to have declined, wholly from this cause, from 15-6/10 to about 15 to 1. Yet as this last proportion, however produced, coincides so nearly with what may be deemed the commercial average, it may be supposed to furnish as good a rule as can be pursued.

The only question seems to be, whether the value of gold ought not to be a little lowered, to bring it to an exact level with the two markets which have been mentioned. But as the ratio of 1 to 15 is so nearly conformable to the state of those markets, and best agrees with that of our own, it will probably be found the most eligible. If the market of Spain continues to give a higher value to gold (as it has done in time past) than that which is recommended, there may be some advantage in a middle station.

A further preliminary to the adjustment of the future money unit, is to determine what shall be the proportion and composition of alloy, in each species of the coins.

The first, by the resolution of the 8th. of August, 1786, being referred to, is regulated at one twelfth, or, in other words, at 1 part alloy to 11 parts fine, whether gold or silver; which appears to be a convenient rule; unless there should be some collateral consideration, which may dictate a departure from it. Its correspondency, in regard to both metals, is a recommendation of it, because a difference could answer no purpose of pecuniary or commercial utility, and uniformity is favourable to order.

The ratio, as it regards gold, coincides with the proportion, real or professed, in the coins of Portugal, England, France and Spain. In those of the two former it is real, in those of the two latter there is a deduction for what is called remedy of weight and alloy, which is in the nature of an allowance to the master of the mint for errors and imperfections in the process; rendering the coin either lighter or baser than it ought to be. The same thing is known in the theory of the English mint, where 1-6 of a carat is allowed. But the difference seems to be, that there, it is merely an occasional indemnity within a certain limit, for real and unavoidable errors and imperfections; whereas in the practice of the mints of France and Spain it appears to amount to a stated and regular deviation from the nominal standard. Accordingly the real standards of France and Spain are something worse than 22 carats or 11 parts in 12 fine.

The principal gold coins in Germany, Holland, Sweden, Denmark, Poland and Italy, are finer than those of England and Portugal in different degrees, from 1 carat and 1/4 to 1 carat and 7/8, which last is within 1/8 of a carat of pure gold.

There are similar diversities in the standards of the silver coins, of the different countries of Europe. That of Great Britain is 222 parts fine to 18 alloy: those of the other European nations vary from that of Great-Britain as widely as from about 17 of the same parts better to 75 worse.

The principal reasons assigned for the use of alloy, are the saving of expence in the refining of the metals (which in their natural state are usually mixed with a portion of the coarser kinds) and the rendering of them harder as a security against too great waste by friction and wearing-The first reason, drawn from the original composition of the metals, is strengthened at present by the practice of alloying their coins, which has obtained among so many nations. The reality of the effect, to which the last reason is applicable, has been denied, and experience has been appealed to as proving, that the more alloyed coins wear faster than the purer. The true state of this matter may be worthy of future investigation, though first appearances are in favour of alloy. In the mean time, the saving of trouble and expence are sufficient inducements to following those examples which suppose its expediency. And the same considerations lead to taking as our models those nations with whom we have most intercourse, and whose coins are most prevalent in our circulation. These are Spain, Portugal, England and France. The relation which the proposed proportion bears to their gold coins has been explained. In respect to their silver coins, it will not be very remote from the mean of their several standards.

The component ingredients of the alloy in each metal will also require to be regulated. In silver, copper is the only kind in use, and it is doubtless the only proper one. In gold there is a mixture of silver and copper; in the English coins consisting of equal parts, in the coins of some countries varying from 1/3 to 2/3 silver.

The reason of this union of silver with copper is this -- The silver counteracts the tendency of the copper to injure the colour or beauty of the coin, by giving it too much redness, or rather a coppery hue; which a small quantity will produce; and the copper prevents the too great whiteness, which silver alone would confer. It is apprehended, that there are considerations, which may render it prudent to establish by law, that the proportion of silver to copper in the gold coins of the United States shall not be more than one half, nor less than one third; vesting a discretion in some proper place to regulate the matter within those limits, as experience in the execution may recommend.

A third point remains to be discussed, as a pre-requisite to the determination of the money unit, which is, whether the expense of coining shall be defrayed by the public, or out of the material itself; or, as it is sometimes stated, whether coinage shall be free, or shall be subject to a duty or imposition? This forms, perhaps, one of the nicest questions in the doctrine of money.

The practice of different nations is dissimilar in this particular. In England, coinage is said to be entirely free: the mint price of the metals in bullion, being the same with the value of them in coin. In France there is a duty which has been, if it is not now, eight per cent. In Holland there is a difference between the mint price and the value in the coins, which has been computed at .96, or something less than one per cent, upon gold; at 1.48, or something less than one and a half per cent. upon silver. The resolution of the 8th of August, 1786, proceeds upon the idea of a deduction of half per cent. from gold, and of two per cent, from silver, as an indemnification for the expense of coining. This is inferred from a report of the late board of treasury, upon which that resolution appears to have been founded.

Upon the supposition that the expense of coinage out to be defrayed ought of the metals, there are two ways in which it may be effected; one by a reduction of the quantity of fine gold and silver in the coins; the other by establishing a difference between the value of those metals, in the coins, and the mint price of them in bullion.