The Republic for Which It Stands: The United States during Reconstruction and the Gilded Age, 1865-1896 (Oxford History of the United States)

by Richard White

Ralston shared financial interests in the Comstock with Sen. William Stewart of Nevada, and he helped to finance Stewart’s campaigns. He conspired with Stewart and a small group of senators to push the passage of the Coinage Act, which on the surface seemed a mortal blow to his interests. In fact, it struck a delicate and clever balance. The act demonetized silver, thus preventing a rush of European silver into American markets, but it also created a government market for American silver by authorizing silver trade dollars to be used in the China trade. These would be produced at the San Francisco Mint, giving Comstock silver an immense price advantage over silver that had to be shipped from Europe. The act killed two birds with one stone, discouraging European imports while creating a protected market for American silver. It gave Ralston a final gift by eliminating the coinage fee that those who sold gold and silver to the mint had to pay to get their bullion converted to coin.