The herald., 1898-06-19
LONDON'S SQUARE MILE

That square mile in London which A
the late General Walker said, dictates the
monetary policy of the world, Is not satis-
fied with the plan Of the Indian government
for establishing the silver rupee on a eold
basis. The square mile of banking in.
terests approved of the closing OF the In
dian mints in 1898, it approved of the sue.
gestion that gold status for tho rupee
should be fixed, 1t hotly denounced tho
suggestion that the Indian mints should
be reopened to silver, it vetoed the propos-
ais of the Wolcott commission, it had not
words bitter enough to characterize the
course of the British ministry in listening
to the American bimetallic proposition,
and 1t now plants itself in the way Of the
only plan which can be devised to establish
the gold standard in India.
The reason for this last course h that
gold is quite naturally required to set up
the standard in India. and financial Lon
don does not feel that 1t can spare the gold
The London correspondent Of the Ne
York Tribune writes on this point:
"If India could find it's own gold thel
would be no protest from the city, bl
this is precisely what its financial advisers
insist cannot be done. They recommend
q gold loan of $10O, 900. 900 in round numbers
to be raised by installments of $50, 900. 900.
If the committee of investigation supports
this proposal, and the India office acts upon
it, the city will have to provide the gold,
and this cannot be done without Tightening
the money market, weakening the reserves
of the Bank of England and producing mon
etary stringency. There has been pro-
longed financial stringency in India as
the result of the close of the mints, and the
efforts of the government there to impart
an artificial exchange value to the rupee
by virtue of scarcity, but that was long
way off. The gold standard cannot be
introduced in India without serious sac
rifices and Inconvenience in London; and
monetary stringency here is to be avoided
at all hazards by the city. Theoretically
the bankers are in favor of a gold stand
ard for India, but practically they are op-
posed to any measure which will drain the
gold resources of London. For this rea-
son they are ranging themselves as OBJ
structionists in their memorial to the In
dia Office and the treasury, and discrediting
an inquiry which is the logical outcome OF
their own resistance to monetary confer
ences and to international bimetallism."
That is to say, the London bankers have
suddenly become adherents of that de-
spised "scarcity-of-gold'' theory of the BIZ
metallists. They want a gold standard
established in India, but they think there
is not gold enough to spare for doing SO.
If the United States had not within a
few weeks taken 900 or so of gold
from Europe, and chiefly from London,
the Indian monetary reform scheme would
not look SO threatening to London's IA
nous square mile. AS 1t Is, the city Is in
no position to give up much more gold
without a monetary squeeze sufficient to
cause disturbance, and that position Of the
city will not be improved at all by the
present trend of the foreign trade of the
United States, which is decidedly in IA
vor of the retention of recent gold imports
and the continuation of the movement next
fall. This is well. The London square
mile has made its monetary bed and 1t IL
now to lie in it at full length.-Springfield
Republican.