WORLD FINANCE

Hokitika Guardian, 24 June 1933, Page 5

WORLD FINANCE

1 PRESS COMMENT ON ATTITUDE OF AMERICA. l United JbeKS Association—By Electric Tejegrup ii—Copy ngli C. j LONDON, June 23. The “Times” Washington correspondent, who is attending.the Con eieneo, says: According to the American Delegation, Professor Moley brings r.o new instructions, and posseses no authority for favourably -modifying any phase of the negotiations. J.f ho brings anything it may bo a reasonably reliable calculation of the time elapsing before President Roosevelt is ready to stabilise the conditions in America’s domestic markets. The “Times” lias a leading article regretting President Roosevelt’s refusal to agree to a currency truce. It emphasises that ifc was hoped that ho objected merely to the terms of the arrangement proposal, and did not op-

pose the principle of keeping the dollar stable while permanent stabilisation was being discussed. it says the abandonment of that hope may be very disconcerting. Any great depreciation of the dollar in the terms of sterling or francs, unless balanced at least by a corresponding rise in dollar prices, it says, is likely to depress .prices below their present disastrous levels,, and it might force other countries to adopt protective, steps similar to those taken when Britain abandoned the gold standard, thus creating an atmosphere unfavourable to the conference. Nevertheless, it says, it may be taken that President Roosevelt- understands the danger of uncontrolled inflation unci will be prepared to call a halt'when the American prices are restored to a toloraole level and this perhaps comparatively quickly.

The “Times” city editor says: If President Roosevelt succeeds in raising prices generally, the whole world will benefit, but, inasmuch as no case is recorded wherein a depreciated currency has succeeded in raising world prices, as distinct from domestic prices, tiie city editor believes that the experiment will be attended by grave risks. There would be less anxiety if the world were confident that Mr Roosevelt would be able to stabilise che dollar when it reaches a certain point, but it is feared that political opinion will later be as strongly opposed to stabilisation as it is to-day, because it will involve a cessation of inflation, and will check the local rise in prices. It is also argued that once the inflation stops, deflation automatically begins, owing to the withdrawal of the impetus Ol fresh purchasing power. British oflicial circles refuse to be downcast by the rebuff caused by the American failure to support the earlier temporary' stabilisation project. , They state that time must be given to see the effects of President Roosevelt’s measures for trie recovery of prices. Trie present rises have only affected the existing holders of stocks* and have not yet reached the producers, Britain and America are agreed a« to the necessity for stabilisation, the only difference being when this should take place

The Russians are gloating over the American resolution, declaring that it must strengthen their demand lor the withdrawal of the British trade embargo.

U.S. DELEGATION STATEMENT. RE CURRENCY STABILISATION. RUGBY, June 22. The atitude of the United States, regarding the suggested tempo.aiy currency stabilisation, was elucidated to-day. by the following statement, issued by the American delegation 'to the Conference. “Undue emphasis has been placed upon consideration Qf the plan pro' posed for the temporary de facto stabilisation of currencies. The fact is that this was never the affair of the delegation. It was considered by representatives of the treasuries and the Central Banks of the United States, Great Britain and France. Dr. Sprague Haiton has been specially sent to represent the United States Treasury, lor this purpose. j “As to the ultimate objective, the American delegation has already introduced a resolution designed for the ultimate world stabilisation of unstable currencies, and is devoting itselr to the support of measures for the establishment of a co-ordinated monetary and fiscal policy, to be puisued by various nations in co-opera-tion with each other, for the purpose of stimulating economic activity, and improving prices.” AMERICAN RESOLUTION TABLED. URGE FOR PRIVATE ENTERPRISE. (Received this day at 10 a.in.) LONDON, June “3. The American delegation to the monetary commission tab'*©d a resolution, largely in harmony with Air Noiillo Chamberlain’s, regarding readily available credits, but urging the serious eiicouragement of private enterprise through Government expenditure. America suggests that sutii expenditure might readily be financed bj boirowing, piovided that debt service is covered by balanced budgets. After urging a synchronised programme of Govcrnmeni il expenclit.’.!n by the dill-r----ent countries along parallel lines, the resolution suggests that the issuing banks of the various nations should send representatives to London immediately, for the purpose of consultation and ap-

pointment of a conference committee which would report for the guidance of individual nations regarding the work of the programme.