The Guardian And Evening Star, with which is incorporated the West Coast Times. SATURDAY, MAY 2nd., 1925. THE GOLD STANDARD

Hokitika Guardian, 2 May 1925, Page 2

The Guardian And Evening Star, with which is incorporated the West Coast Times. SATURDAY, MAY 2nd., 1925. THE GOLD STANDARD

\ i tki; long t ontrovei.sv ive ale back to lie* gold c tundnrd. Cleat lim.ini hie; Peen hold enough t > solve tie* ipies.e.n i,.j- liersell end tie* Kinjnlc :it urge (India excepted) ami nothing titastrophie h: *, happened. I In lla* rnni rary the pound sterling lias juin|cd in i aloe. Strange to say many British hankers have been arguing agaiie.l Ihe gold standard. Inn all seem to tome hiU'k to the basis that the gold standard is alter all essential. It is the tangible something to create confidence, and that is the lirst essential where credit is at stake. The reviving strength ol the pound sterling must have rd; immediate etfeot on commerce. Bankers who have been discussing the subject, largely In the abstract, have, as an American financial papet remarked, been arguing solemnly and convincingly against tl.e necessity for a gold standard because even gold changes its value. But while the economists diller greatly on the subject even some of those who argue eon-

IraiTlv. iv. oiiiiis.- (<-i't;ii ll essential . values in the wild standard. Such a one is Mr McKenna, an cx-('hancel-' Inr of Knulainl. ami now at the head of tlia Mnllainl Haul;, described as tlit* largest commercial hank in the world. Ho stated recently : "In the present _ stato of knowledge and feeling one ] id' tlio greatest advantages of tlie gold standard is its mural oll'eet. A nation will think I><■ 11«*r of itself, will almost reward itself as more holiest, if its curren y is coiivertihle into gold. . The fear of Indue forced off the oold standard acts as a salutary check on the extravagance id' (lovernments who might he willing to face a mere lluetnation in exchange. hnl would not dare , to suspend specie payment. It is a real advantage to a nation to have a currency founded upon a value which i.s universally recognised ; it ins| ires eonfideneo and faeilitates intornatiunal transactions. Keen if me gold stain' aid were not, preferable for other results its nniver-ality would I decisive in its favour. The argument may, it is true, he founded on psychological and not on eeonomie grounds, hilt it is none tin- loss powerful, as we have not yet reached the slam, where economic considerations alone guide us in judging the desirahility of any particular method or system. So lone as nine people out of ten in every country think tin’ oold standard the host it is the best. If in the future there wore an immense increase or decrease in the output of wold, and eonsof|u.outly a startling rise or fall in prices, reconsideration of the subject might lie forced upon public attention, lint, at present there is no single nation, so far as I know, which is nowoff the cold standard, that does not iv-.ward the return to it as the most desirable cf all financial measures.” Beyond doubt English finance and commerce sot its face firmly in the direction of restoring the pound sterling to a cold parity, and after bavins accomplished that, of keeping it there. The importance of the task is fully appreciated. As the London Economist well said : "To return to the sold standard will enhance British prestige at the same time that it ties up» our exchange with other "old countries, ami these two factors combined may he expected to produce the most wholesome effect loth upon our commerce and upon our industry.'' The event j has now come to pass, and so far the indications of the financial effect ate verv satisfying. ‘