The Guardian And Evening Star, with which is incorporated the West Const Times. THURSDAY, MARCH 12, 1931. THE PROBLEM OF GOLD DISTRIBUTION

Hokitika Guardian, 12 March 1931, Page 4

The Guardian And Evening Star, with which is incorporated the West Const Times. THURSDAY, MARCH 12, 1931. THE PROBLEM OF GOLD DISTRIBUTION

Many of the ablest economists arc at the present time greatly concerned over the question of the gold standard; or at least concerned about one phase of it, vi/,., that the fall in commodity prices which is the curse of producing countries directly and of non-produc-ing countries indirectly, may bo largely due to the scarcity of the basic metal or to the mishandling or maldistribution of the gold in existence. If they are correct- in their theories a New York commercial journal considers we have hut two means of escape from a situation which hears heavily upon the debtor classes and nations, greatly lessening their purchasing power, and delaying, if not preventing, the trade, and business recovery so ardently desired by the whole world. Tim production of gold has not for the last few years kept pace with the theoretical necessary increase which trade aml industry require, and un-i-ess there are new rich discoveries which are regarded as highly improbable, the world may find in a few years’ time an acute shortage of our standard of value resulting in a slow but steady decline of prices as one of its effects. This would upset- relations between purchaser and seller as well as between debtor and creditor to the advantage of the holder of long term evident os of indebtedness and harshly penalizing the debtor for no fault or his own. Let us examine the chances of increased output of gold. This would have to be looked for principally from four sources—South Africa, Australia, Canada and the United States. Of the total output of the world, South Africa gives us roughly fifty per cent., Australia four per cent, and United States of America eleven per cent. The production of the last mimed has been decreasing for the lust few years and the engineers think there is small likelihood of large and important- new fields being discovered South Africa is more than holding its own hut without new discoveries. The tune cannot he many years away where these wonderful mines will begin to falter in their output. Possibly the best prospects are in Australia and Canada where new areas of richness might be found in the interior of the Island Continent or in Northern Ontario and Quebec where, thanks to the airplane, prospectors are able to make careful search in territories which would otherwise have been difficult to reach, Perhaps from these lands help will be forthcoming. The other means whereby the seriousness of the problem could he alleviated would lie by making better use of the gold now in existence from day to day. To correct the present maldistribution of the metal stocks is a problem for hankers and statesmen. At present the United States and France have far more gold than they need and (he rest of the world lias too little. Tt may very well bo that the two gold laden lands will find it necessary to accept more goods and less gold in settlement of international balances.