The Hokitika Guardian WEDNESDAY, DEC. 20, 1922. IMPROVED EXCHANGE.

Hokitika Guardian, 20 December 1922, Page 2

The Hokitika Guardian WEDNESDAY, DEC. 20, 1922. IMPROVED EXCHANGE.

When asked if he could throw any light on the sudden appreciation of the pound sterling in New )oi k, Mr Harold Beauchamp stated in Wellington last week that when ill New York some time ago he *met a number of people intimately connected with finnnee in New York, and discussed with them tlie complex problems of ex-

change, especially as far as the relnt on of the £ to the dollar was concerned, lie was assured by one authoiity. a man well placed for making a financial forecast that it would not then be long before the £ returned to something like its former parity of dollars -1.86. In fact the gentleman who made this statement, put it confidently that in twelve months from then parity would he restored. ‘'The trend ot the exchange certainly seems to be bearing out bis prediction. Tie was not alone.” Mr Beauchamp said, “in thinking that the restoration of parity was not very far away; there was a feeling generally among bankers and commercial men whom I met in New York that parity of exchange between pound and dollar was in sight. The reasons for this view were several, explainable by tlie usual business prescience shown by Americans. There was the factor of the immense amount of money taken out of America by tourists.” “How could that seriously influence the situation ?” Mr Beauchamp was asked. •‘Well. American financiers thought so, and you will see why, when you learn, as I did. that it was an authoritative estimate that .">00.000,000 dollars or £100,0(10,000 was taken out of the country by tourists to Europe in twelve months. Then there is no question lit all that the American exports have suffered great diminution by the high price of tlie dollar. No foreign country could afford to do business with America at the rates of exchange that have been ruling. We. that Is the British Empire, were compelled to buy from America nothing that we could obtain elsewhere. For goods and products of which America had the monopoly we had to buy from that country, but even then as spavin '■ as possible. American manufacturers fully realised tlie formidability of the hurdle that the rates of exchange set up in the way of trade expansion. They will very cordially welcome the approximation of the £ sterling to parity with the dollar. The standing of the £ sterling in countries other than America was also a factor in the situation and the urgent need for tlio sake of America that tlie dollar should get back to its old position in regard to the £’s. There are reasons to he found, too, lii the desires of the Government of Great Britain and Europe to end this present impasse to resumption of commercial intercourse caused by the depreciated currencies of Continental countries. It is recognised that something must he done, and that speedily to get hack to some practicable working basis. The feeling is no doubt influencing tlie United Kttnes Government, too, in the interests of its own internal mid external trade. Tt certainly appears that my informant’s forecast that the parity between the £ and the dollar will be readied in twelve months from the time he made it was correct.”