The Guardian And Evening Star, with which is incorporated the West Coast Times. TUESDAY, MAY 30, 1933. AMERICAN FINANCE.

Hokitika Guardian, 30 May 1933, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. TUESDAY, MAY 30, 1933. AMERICAN FINANCE.

Thij United States,has elected definitely (to 00 off the gold standard,'/though virtually that has been the, position for, the past few -weeks. • Since the bjnks upset the even tenor;-of public f 3i!arice the United .States has had a T.jffieuit position to face. The 'banking holiday served to steady -the position, . hut when business was 1 resumed many found their savings gone in institutions which were unable, to carry ■o.i. The hanking system •ia . the. tfnited 'States 1 lias been rather a liappygj i-lucky affair,' and the enquiry going o(.t now, reveals that the favoured few,! hj ve .been helped very materially, 7 Bs nking reform will now be inevitable, bu:.t meantime the active President* has decided to abandon the gold standard for, financial values. This Step is lively to have far-reaching efforts/ It ie notjdeav that from the point /of riebefc sity : tlie . United Stftfes go off the gold standard, Much'gold Is reported: to be stored in ,slic. Federal vaults and it was considered there was ample cover for *tJie (jpaper money in circulation. The full details of\ the situation, however have not been revealed, and the true cause of the President’s decisive act is not ■known* publicly. The effect or the action is to stimulate buying and deal-' ing on, a large scale, and it does not appear that confidence in the public finance is shaken. The American action may be a mov© to help the Allies pay their war debts to the United States in a depreciated cm*rency. Apparently America will take payment in the face value of any regular currency. This would be a great help to the debtor nations, but it is far from giving the relief that was anticipated from u real sealing down of the war debts!. Congress appears to be opposed to lany wiping out of the war debts, and because of that, this • alternative may have been devised. Another aspect is the standing of the United States at the coming World Conference. The American dollar is depreciated and American money will stand in closer relation to European money, all of which, practically, is '.depreciated.- The, United States may he in a better position to bargain on those lines, or to suggest adjustment of world currencies in keeping with world conditions. France, has its hoards of gold also, but it has a greatly depreciated currency, and the wonder is that it seeks to hoard cold while refusing: to pay America. The sudden departure from the gold standard in America , will disorganise private finance if depreciated currencies vU'o bo be accepted for private or semi-puhlio debts. Many loans contain a provision as to tlie sterling value of currencies to be used in liquidaton, and it is not clear whether this clause is being abrogated. If it is, then it will he helpful to the payer, but the payee will go short in his calculations. The action will have a disturbing effect generally until the situation is clarified by definite legislation, but the trend seems to be an effort to help the general situation President Roosevelt would only move o n a definite line and under expert advice, and judging by his line of conduct be will be guided by the best of motives te,. +h© pmelio’-ation ol go’'"’-! conditions and not specific cases.