SERIOUS DANGER

Otago Daily Times, Issue 26641, 11 December 1947, Page 7

SERIOUS DANGER

WORLD ECONOMICAL COLLAPSE DRAIN ON BRITAIN’S HARD , ASSETS Rec. 10 p.m. NEW YORK, Dec. 10. The 400,000,000-dollar balance of the British loan, which the United States lias just released, will be exhausted about the end of January, and as the Marshall Plan cannot be passed until the end of February or mid-March, the British Treasury is endeavouring to bridge the gap in dollar' supplies by other means. This was reported by the Herald Tribune’s columnist, Mr Joseph Alsop, who is now in London He adds that the expedients being explored are still cloaked in secrecy, but most probably they involve mortgaging the few remaining dollar-value securities which Britain holds. Pointing out that Britain’s basic reserve of hard assets is now only equivalent of 2,000,000,000 dollars. Mr Alsop says that if reserves fall much below that figure there will be an acute danger of a run on the Bank of England, which holds the operating reserves for the entire sterling area. Britain would then be entirely depleted of hard assets and the entire sterling area would fall to pieces, normal world trade would cease, and the economy of the whole non-Soviet world would collapse. Mr Alsop says Britain will turn the corner this winter if in our own interests we give them the needed help.