The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY; JULY 6, 1928. FRANCE’S COLD STANDARD.

Hokitika Guardian, 6 July 1928, Page 2

The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY; JULY 6, 1928. FRANCE’S COLD STANDARD.

Tub stability of the French franc promises to be brought to pass. After long delays and an apparently endless controversy which in the long run completely bewildered everybody but trained experts, tile French Government—which is to say M. Poincare—has carried a 'Gold Currency Bill through both Houses of the National Assembly. As tho franc before the war was worth about. o>d and in recent months it lias been oscillating .somewhere below 2d, ■it is obvious, says a financial critic, that there could bo no attempt to equate the franc to gold on the old basis. But what the country most urgently' was stability, and.this at least can bo secured under the new system. In the scheme adopted by the Finance Commission the new franc is to be equivalent to a certain weight in gold, which will make 1241 francs exchangeable for £1 sterling. The franc will be worth less than 2d, as it is now, but the rest of the scheme contains provisions for preventing further fluctuations of the kind that have proved so disastrous since the war. The Bank of France must assure the convertibility of its notes into gold, and as a reasonable margin for safety, it will be forced to woyk its note issue on a 35 per cent basis—in oilier words, it will need always to have on hand in gold rather more than one-third of notes that it puts into circulation. Of course this in only a brief and crude view of the complicated process by which inflation is to be prevented, and the sterling value of the franc is to be in future maintained. However, the application of the system is rendered comparatively' easy by the fact that the Bank of France is a National Bank, and not like the Bank of England, a private joint stock company, and the French Government, can do exactly what it pleases’ to compel the hank to stick to its instructions. But whether the system fulfils all expectations or not, there is no doubt that its adoption by overwhelming majorities in the Senate and the Chamber of Deputies is a great triumph for Poincare. As an outcome of the new formed stability, a cable message from Paris this week reported /crowds are thronging The Bank of France to exchange pre-war gold coins for paper francs under the new valuation. The rush is duo to the fact that the coins cease to bo negotiable when the liunidred franc gold pieces, now being minted, are issued ; thus everybody is bring ing gold from hiding places. The hidden hoards of gold now revealed will be a welcome addition to the store of gold deposited in the Bank of France as security for the paper money to be issued, and will he helpful in assuring the ultimate success of the stability scheme directed byPoincare. That remarkable mail, able and courageous as he is, is too dogmatical and too much of a lawyer ever to be very popular. But no one can deny that his services during and since the war have been of inestimable value to 'France, and it was generally felt that no other public man had sufficient driving power and commanded sufficient public confidence to effect the stabilisation of the franc. He was put in offico for that special purpose, and he has had to fight hard against the vehement political antagonism which his presence in Cabinet or Parliament always seems to arouse. But no one seems to question his highminded and public-spirited patriotism, and on the strength of this lie lias induced Conservatives mid Royalists and Radicals and Socialists alike to vote for his bill. What they will do after the event—whether a new combination will be made promptly to hurl him from power—it is too early to predict. But Poincare has won a great victory, and he deserves well of his country and its people. He is certainly an outstanding figure in France, and has been one of the public men who figured in the world drama of the Great War who lias worn well in the public service. He has been a man of remarkable determination, and has pursued his course to the realisation of his objectice "ith a wonderfully set purpose which nothing could actually check or defeat.