U.S. GOLD PURCHASE

Hokitika Guardian, 27 October 1933, Page 5

U.S. GOLD PURCHASE

PAYMENT METHOD . WITH GOVERNMENT DEBENTURES United Press Association—By Electric telegraph—Copyright,.; n WASHINGTON, October 25. Open market purchases of Amtril- can gold began to-day at 31.56 dollars i- a n ounce, which is 2 cents above the ■■ London price, which rose live cents t trom its own opening price to 31-14. 3 The value of the dollar here thus 3 1 became 65.91 cents in gold or half a 3 cent less than its value in French ' gold francs. The procedure of the gold purchasers 1 is to offer for subscription in un- ' limited amount, 7 to ninety days, debentures of the Reconstruction Finance Corporation, the subscriptions 1 to be payable in newly-mined gold. .The amount of gold mined in the United States averages approximately a million dollars weekly.

President Roosevelt, who is indisposed to-day, declined to discuss his financial plans, although it was pointed out that every body in Wall Street would like to have from him a schedule of his monetary plans for ,tlle next sixty days, He pointed out that nobody knows what the Bank of England will do to-morrow, or the Bank of France to-day, INTEREST IN U.S. PROPOSAL. LONDON PRESS COMMENT. LONDON, October 26. The “Daily Telegraph’s’’ financial editor says: The bullion brokers here have keenly awaited the American Treasury’s announcement as to its intention to buy gold at the rate of

31 dollars 36. cents per ounce, or 22 cents per ounce above 3 T esterday’s London price. Wliat created surprise and some preliminary confusion was the decision to pay for the gold in. I Reconstruction Corporation : Debentures which are readily cashable. The sale of gold for a marketable security ds surely unique in the annals of the mining industry. As the American plan will riot draw any gold from othdr markets, it dees not create a new free gold market. It does not compete with the London price. Its practical effect is limited to the, depreciation of the dollar, as the result of which it is expected that American internal commodity prices will rise. ‘ FRENCH CIRCLES PUZZLED. PARIS, October 26. French fmancal circles are • puzzled at President Roosevelt's decision, and they express the' opinion that, as it only concerns America’s home production of gold, amounting to only six per cent : of the world’s output, it will directly affect the dollar exchange. If the U.S.A. Finance Corporation begins to buy gold in the world market, their protective measures will be necessary.