WORLD’S GOLD OUTPUT

Hokitika Guardian, 30 January 1920, Page 1

WORLD’S GOLD OUTPUT

(Reuter's Telegram.) LONDON, Jan. 22. “ The Times,” in its annual financial review of the year 1919,. says that as regards gold, last year will take precedence over any year since 1813 for eventfulness. It, inter alia, confirmed the conclusion of the leading economists in the nineteenth century, that gold, despites its limitations, provided the most suitable basis of a sound currency system. These conclusions fcn_ umphed in the restoration, after five year s of a free market, in the sale of the current output. Permission was granted to Australian producers .in order to prove their contention that they were receiving less than market value, resulting in their disposal if 210,000 ounces, at an average of £4 15s 9d per standard ounce. The causo of the rise in the paper price of gold was shown to be the same as the Napoleonic Wars, when it reached £5 10s per standard ounce, namely, the excessive issue of paper currency in relation to the supply of goods and gold.

A tabulated statement shows the value of the world’s gold output last year at £75,000,000, of, which the Transvaal provided £35,000,000 and the rest of the Empire £14,000,000, as compared respectively with £96,800,000. £38,600,000, and £20,100,000 respectively in the year 1915. The world’s drop per cent last year, compared with 1915. was 22.

Allowing for Labour dffiiculties and the effects of increased working costs, the experience of the gold industry in war time emphasised the danger of attempting to limit the operation of the law of supply and demand. Tlio article points out that the pro. do cor 9 are wisely stimulating the largest possible output at present, as the existing high price of gold will not be maintained. Consequently, the decreased production may be regarded as checked, and increase may confidently lie anticipated in 1920, uriless the unforeseen happens.

India was an important factor in the. gold market during the second half of last year. Owing to the favourable trade balance, the Indian Government, recognising that it was cheaper to buy gold than silver, in order to meet the currency demands, prohibited the private importation of gold, despite producers’ protests, and on the basis of American exchange and the price of silver the Government was enabled to buy sovereigns at about 24s and to rc-seil them in the bazaars at a rate working out at '34s.