The Jasper weekly courier. [volume] (Jasper, Ind.) 1858-1922, 1898-11-04
THE WAY IT WORKS.
How England Holds ON to Her Cold
Sells Securities Instead OF Ship
ping Bullion.

to prevent any great flow Of gold to
the United States. And so far Ler
fighting has been crowned with what
must be TO many people on this side
Of the water mucn unexpected success.
In fighting TO hold gold the Bank Of
England reduced it's loans by $4,000
600 during the eight weeks ended Sep
TENDER "a and raised the bank rate of
discount. 1t also went into the Lon
don money market with consols or
British government bonds for collat-
eral and borrowed money. Thus II
stiiTened money rates and forced
contraction of loans to other people.
All this contraction, Of course. had the
result OF obliging men to sell goods
and securities that had been pledged
as securities for the loans called This
meant a pressing down Of prices, and
in general way check TO merchar-
disc imports and stimulus 10 exports.
And thus the drain Of gold was checked
In slight degree.
But the radical check. the check
looked for TO bring success, is over the
calling of loans on American securi-
ties and the forced sale Of such securi-
ties upon the American market. Such
sale Of staples makes exchange-that
is creates credit IN New York
against which drafts may be drawn
and forwarded in place Of gold a draft
hy letter taking the place Of kcg OF
gold. In this way hiss the Bank Of
England neen fighting 10 keep up gold.
But Of late weeks tie New York banks,
with their reserves depleted and in
much need of gold TO rcplenish them,
have beer fighting not 10 Keep gold.
but to bring gold from Europe. Thus
did The New York banks contract their
loans by S3oc0o.0o0 during tile same
eight wee ks that the Bank Of England
contracted its by Sis.o00Ceo. The re-
suit Of the contraction Of loans ia New
York was TO take away the sustaining
power behind many securities. OF
course prices We're pressed down, and
those who owned the securities or the
products lost money. Yet what cared
the gold gang for this? But pressed
down as these securities were, the
Bank Of England forced British hold
ers OF such securities 10 part with
their gold. Ana the pressing OF Brit
ish holdings on our markets caused
still furi ner pressing down OF prices
Ii neccssitated the making of great
sacrifices by British investors, but
those sacrifices they were compelled
10 make. and thereby England saved
her gold. This fighting for gold is
running business, entailing losses and
stopping the wheels Of industry all
over the world. How long will the
masses OF the people permit themselves
and their interests TO be sacrificed 10
the single gold standard froloch?
That which surprises most people
however. is that England can Away.
fail back upon sale of foreign securi-
ties at a pinch and export mail bags Of
securities rather than kegs Of gold.
This is explained by an exchange as
follows:
England is the great creditor ma
ton OF the world. to the extent Of about
s75O.0O0,0OO year. which represents a
principal of somewhere between $751;
0o0. 100000 and 100000, 900, eco due her
creditor classes by the debtor coun-
tries OF the world Last year. for cx-
ample, the imports into the United
Kingdom wers valued at E39i 100000.
her exports G234.35o,003. an adverse
trade balance of { III, 100000. or about
S7s50o0,0c0. But though She thus
bought c157.O0O 900 Of merchandise
more than she sold, her imports and
experts If gold balanced within e2s-.
The greater part Of this seeming nd-
* rse trade balance of ci57.oOg.cOO
was balanced Of by the interest ac-
cruing ON loans made abroad and the
sums earned by British ships.
The adverse trade balance for this
year promises 10 be greater. During
the first seven months 81 the present
year the United Kingdom exported
el525eS. or worth Or merchandise. i'm
ported f2a41sT.9i9. an adverse ball
ance Of EI02000.OOo. S5o0.0C0cc0 for
seven months. Andyet England gained
six millions Of gold during this period
by the exercise of ways we have
noted"
The whole world is made to pay trib-
ute to the gold power Of the shylocks
Of England Is il not high time that
the United States, at least. were max
ing another declaration Of independ-
cnce ?--Illinois State Register.
Thc~ Hal Nh Gwxe