South Bend news-times. (South Bend, Ind.) 1913-1938, 1915-10-09
Is TOO MUCH GOLD AND TOO
MUCH FOREIGN TRADE \
BLESSING OR MENACE?

gard 20 possible industrial conditions
in the United States that are TO follow .
the European war, vet economic ques-
tons seem to be arising in the minds /
of men. much more versed in eco
Monies, and brighter far than we, |
that are quite depressing They are
based too upon conditions absolutely
incident TO the war. and some OF the |
reasoning is semi-startling; involving, |
for instance. such queries as. can a
nation have too much gold? and. is a |
balance Of trade "A sure sign OF pros /
perity. or is it a menace?
These are questions that are bother
ing public men in official Washington.
economists in the universities, and (
students OF labor conditions. none Of
whom are so optimistic as we would
like to see them. Take them up sep (
arately:
The United states has in the federal
reserve banks. according to a state
ment of Sept. "a. S29O.224,OOO in gold.
Since Jan. l. we have received sold
from abroad to the amount of $780,
100000 The annual production OF
gold is approximately 100000. geo. /
So We have in the United States now
over two billions in gold. Which is
larger than the combined gold supply
Of any other two nations in the world.
IN addition TO this the year will close
with balance of trade in our favor
what the foreigner owes us for goods
sold and elivered-amounting to APP
proximateIy $4,000. 600, Gee. And over
and above this the controller of the
currency announces that the national
banks which make up the federal re-
serve system have money in theiI
vaults in excess Of the law-prescribed
reserves which would permit them 10
expand their loans TO the extent Of
an additional $4,000. 900, 600. SO on the
asset side of Uncle Sans ledger it adds
Up thus: Gold in vaults, three billions;
money due for goods sold abroad,
three billions; extra Accommodations of
cash in banks seeking investment al
good rates of interest. three billions.
Gold money ordinary money and
promissory notes to the tune of nine
billions.
What OF it? Is everybody rich or is
this accumulation of gold a menace?
Former Director OF the Mint c. d. |
Roberts thinks too much gold is a |
menace. So does w Z. G. Harding OF
the federal reserve board. In recent !
speech in Birmingham, Mr. Harding |
called attention to the danger Of a
period of wild imitation of specula- !
uon." After speculation comes re-
action That is the danger There
is the Blue Monday after the Satur-
day drunk.
Former Director OF the Mint Rob |
erts has things to say on the subject of
gold
The people who argue that the
United States has vast undevelop-
Cd resources and therefore can
absorb an unlimited amount of
sold forget that gold by itself
can do nothins. Ii cannot dis
q trench or lay wall or pillow q
Held except as it is used TO pay a
workman. If there were cor
responding increase in the supply
OF labor and we could have
corresponding increase in the pro-
auction of commodities, then H.
aeed we could use the new sup
plies Of gold 20 advantage In the
past when gold has come from
abroad. labor has come with Is.
Now the whole world is thrown
out OF balance. We are increas-
ing our influx OF gold with no
labor coming with fl. The ca
pacity OF the country for produc-
zion is not being increased.
Fred c. Howe. commissioner OF i'm
migration of the port Of New York,
agrees that the supply OF labor viii be
short. not only during the war period,
bit after the war The number of
lanorers coming here has been re-
duced by the war 70 per cent. Mr..
Howe believes the cutting of of inn
migration viii continue for consid-
cradle period after the war
In view Of this situation Mr.. Roberts
concludes that this accumulation OF
gold is a /, I'd thing He says:
The same amount OF labor and
the same amount of commodities
measured against O. much larger
amount OF gold must Zoe figured
Of AlshtI TERMS IN othtI NQEQSs
wages and commodities must rise.
This prospect is not pleasant 10
those who take the strictly bauking
point OF view AR. Roberts is con-
nected with the City bank OF New
York. and he adds.
II may look like better times
and there might be a slight ad-
vantage 10 those who get the rise
first, but IL would De n gamble in
which everybody was cheated ia
the end. for when each came 20
use his diluted dollars he would
ind they would buy no more than
before
Diluted dollars" is one answer
bankers answer-to the effect OF this
vast thrush OF gold. Higher prices
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