Evidently such a limitation would effectually stop any embarrassing speculation. Thus suppose the fee to be 1% on the Government's deposit — or buying — price, which to-day is, say, $18.00. Then the pair of Government prices, to-day, will be:
| For buying gold | . . . . . | $18.00 |
| For selling gold | . . . . . | 18.18 |
Suppose that to-morrow both prices are to be raised 17 cents, almost to the limit of 1%, or so as to be:
| For buying gold | . . . . . | $18.17 |
| For selling gold | . . . . . | 18.35 |
Clearly a speculator who tried to profit on the rising market would fail; for he would have to give to-day $18.18 and would get to-morrow only $18.17, actually losing 1 cent an ounce. Evidently, at best (i.e. if the shift were not 17 but the full 1%, or 18 cents), he would come out only even.
Reversely, if the pair of Government prices are marked down nearly to the limit, say, by 16 cents, or from
| a buying price of | $18.00 |
| and a selling price of | 18.18 |
to
| a buying price of | $17.84 |
| and a selling price of | 18.02, |
clearly the speculator cannot profit by the fall. To attempt it would mean to let the Government buy his gold to-day at $18.00 and sell it back to him to-morrow at $18.02, causing him actually to lose two cents an ounce. Evidently at best (i.e. if the shift were not 16 cents but the full 1%, or 18 cents) he would come out only even.
It is true that this limitation imposed on the shift, up or down, of the pair of official prices, while it would
