The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-01-16
BANKERS IN A GOLD
PACT WITH BRITAIN
Across Atlantic Shipments to an
Unreasonable Extent Will
Not BE Permitted.
ANNOUNCEMENT IN LONDON

That a satisfactory agreement on trade
balances now exists between the bankers
OF the United States and those OF Great
Britain was evidenced last night by a
statement issued in this city and in Lon.
don on the part OF American and British
bankers.
The agreement as explained. provides
that II at any time during the continuance
OF the war. or within a year after. the
exchanges between the two countries
should become such that gold exports
from either are necessary to an I'M
reasonable amount committees Of bankers
should be appointed to consider plans for
dealing with the situation
The statement issued is as follows:
"In connection with the announcement
by the Treasury upon tho subject OF the
American exchange. which appeared In
tho press OH the sth instant we are au-
thorized TO state that after a conference
held by the Chancellor OF the Exchequer
with the London bankers It was resolved
that lnasmuch as exchange between the
United STATES and the United Kingdom Is
now substantially normal no dennite
action az the present time ls required ,
but that II during the continuance OF the
war. or for one year thereafter. the ex-
changes between the two countries should
become such that gold exports from either
country to an unreasonable amount might
result committees OF bankers shall be APP
pointed In the United States and In tho
United Kingdom respectively to con-
NsaI vrtfn ~
tho situation by such methods as may
seem at the time mutually desirable"
The statement as given out here added
that the announcement was In connection
with plans discussed first between Sir
George Paish and Secretary OF the
Treasury McAdoo In Washington and a
COMM tee OF New York bankers and later
in London between New York and London
bankers.
The announcement. in the opinion OF
bankers. is particularly significant AT this
time and does much to explain why gold
has not been coming into this country
from the Bank OF England depositary In
Ottawa OF from England. as 1t naturally
would with the present rate OF exchange
For some time there has been a feeling
that England would have to send gold to
Offset the way sterling exchange is now
going against her, or that large loans for
the account Of Canada would have 10 be
placed here
Another alternative was that there
might be a heavy selling of American
securities held In London. The plan which
the American and English bankers have
/ in mind. however appears to provide that
whenever 1t shall become necessary APP
parently to ship gold In large quantities
artificial means shall be resorted 10 10
prevent II,
! In the minds OF well informed men in
the financial district the plan Is construed
us a long step In the right direction. In
that II Is the first definite plan ever con-
sidered to prevent wholesale and neces-
sarily costly transfer OF gold from one
! side OF the Atlantic to the other as the
trade balance shifts.
Many leading bankers have expressed
wish that some means could be found
that would do away with this constantly
recurring necessity OF exporting and I'M
porting gold. one international banker
said he wished that all the gold In the
world was on one neutral island In the
middle OF the sea. where trade balances
could be arranged without a constant
shifting OF the metal from one side of the
| Atlantic TO the other.