CURRENCY REFORM

Rotorua Morning Post, Volume 2, Issue 516, 27 April 1933, Page 5

CURRENCY REFORM

DEVALUATION PROPOSED Rec. April 26, 9 p.m. Washington, April 25. It is understood that one of the plans prop'osed for international currency devaluation being favoured by the State Department, has the following points: (1) Currency should be devalued simultaneously. "'Real value" of each currency should be taken as the devaluation gauige. By "real value" is meant the price to which any currency would aettle on international exchange if unsupported. (2) Devaluation should aim toward automatic gold redistribution by fixing lower currency value-s in countries with small gold stocks, like Great Britain and 'Germany than in countries with large gold stocks, such as France and the United States. This it is argued would automatieally siphon gold into countries with lower gold stocks. Financial experts interpreted Mr. Chamberlain's announcement that £150,000,000 stabilisation fund would be announced as indicating renewed determination by Great Britain to keep sterling from rising. It is now regarded as usele-ss to peg sterling against th'e dollar, buf" it is expected that it is contemplated to p'eg isterling against gold standard countries, France, Belgium, Holland and Switzerland. According to exchange experts, this would possibly result in British exchange control drawing gold from those countries in the same manner as it drew on American igold holdings earlier this year. It is asked whether this will not present gold countries with an alternative for abandoning gold. The sum of 2,199,000 dollars in gold shipped under license to Great Britain to-day is an initial step in the repatriation of some 25,000,000 dollars earmarked gold acquired during January and February through the operation of the exchange equalisation fund. b.efore the suspension of American ispecie payments in March.