PANIC ARRESTED

Evening Post, Volume CXXIII, Issue 85, 12 April 1937, Page 9

PANIC ARRESTED

AMERICA'S .INTENTIONS

PRICE TO GO NO LOWER

STATEMENT :BY. V'ROOSEVELT

United Press Assoclntlbn-r-By Electric Telecraph— Copyright.. LONDON, April 10. ' A Washington message states that President Roosevelt denied that the United States Treasury plans to lower the price of gold from 35 dollars an ounce. He insisted that reports to that effect originated in the foreign Press . on April 7. "As bad as the war," was one Lor* don broker's description of the market chaos which culminated in frantic dealings in the Street as bears scram* bled to cover ; following ;■; President Roosevelt's denial that he intended to reduce the buying price; of. gold.: Tha violence of the fluctuations is illustrated in the case of West Witwaters* rands, which were offered as low as 13Joornr Friday and recovered on the Street to 15 1-8, compared with 17 5-8 a week ago. The rumours have been most costly. At one time the market value of a - wide range of shares must have depreciated tens of millions sterling. Not only speculators, but also serious, investors, whose nerves were unequal to the strain, were' involved in heavy losses. , BITTER CRITICISM. There has been bitter criticism in the city of American Inethods, yet it is1 admitted that President Roosevelt has' achieved one of his main purposes with remarkable economy' arid energy, namely, to damp-down'speculation:. .: A leading financial authority told the Australian Associated. ; Press ; agency that President Roosevelt'uses a mouse. ; to do the work of an elephant. , 7He ,

whispers "Down," and the markets blindly follow, without considering whether he has power to enforce his wishes.

■ The "Financial; Times":/, considers that -while the President's -statement has not wholly undone the damage, the world's markets "probably haye been saved from a panic on Monday. The outlook: is■;now much;brighter.; 'Good gold/ shares should gradually recover, though the long-term outlook is no longer,.clear.'y;',':; ).{':r; (;;,.■";-■:_; /v;. •-■; ii ';

The market should, enjoy a respite from exchange fluctuations, with . the franc destined to' settle' down around 112. Commodity .movements should also be less wildi; ;: " V:, . : ' 'PERSISTS/;/,y>.; ■ The market's chief anxiety in weeks, to come will be to avoid 5 being caught with -the wrong foot'off the.ground. Nervousness in the"-bullion market has : by no means been completeljvallayed. The • exceptionally/'large'Varriourit^pt £14,200,000 worth 'was' sold on Saturday morning at a discount of 3d ,6a American parity, / indicating, the: rieiv vousness of holders. : ■ ' .'<..■'. .

'::■. The city,; edit*; of:JlThcj .Times" r cpnsiders that" President"/ Roosevelt's d^ claration should suffice to reassure, the markets that an important, change,in American, gold policy, is not conteni* plated. :'"■■ ' ,:/: ,■;■ :;- ':';:. : t''"' ,;;.:':'.^:S:

The'Sugar/Conference fixed:the free market at 3,170,000 tons. Hard bargaining over quotas is inevitable,, .the realisation of which, combined with Paris selling, led to the.price declining 2&&.\ :][? /:/'•.■■';:/::■■■ ■■■'''" \ ■"--■ ■■^-..

. Cotton resisted the. panic, indicating that its statistical position, is' stronger. It is generally believed that the consumption goods outlook appears moderately favourable.. ::,/•,..;,,;/. ■