The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-12-22
EURoPE'S GOLD CHANGES.
Mr.. Umsted Answers q Critic Of His
Money Mobilization Figures.


haps fruitless controversy, l ask the
courtesy of your space to reply to
some criticisms Of Mr.. r. j. Ober-
fohren in THE Sun Of December IS.
referring to my letter to you. published
December 10. relative to the gold and
currency status OF the European
belligerents.
To enlighten Mr.. Oberfohren 1t may
be stated that the figures I presented
were derived. for the more recent
dates, from Associated Press and SINH
lar cables Of the official statements
made public weekly by the European
Government banks. In the case Of the
Bank Of England I was compelled to
resort to the latest available issues Of
the London Statist and Economist
received here by mail, which carry the
returns Of the issue department Of the
bank. which are not cabled to the
American press and Of the existence Of
which your correspondent writes as
II he were ignorant.
Your correspondent. by a few strokes
OF the pen, cancels $13S. 795. 900 Of gold
held in the vaults of the Bank Of Eng
land to the credit OF the currency note
redemption o as part security
,the rest being in Government securl-
ties and Government credits at the
bank for the s43l .441 $40 British
Treasury currency notes outstanding
on December s. This sum of gold Is
not. as your correspondent asserts.
included In the s254,672 ,657 gold held
In the issue department Of the Bank
81 Ts,rin,l asvafnot s1ta x-altt,.n ~ out
standing bank notes. The currency
note account is separate and distinct
from both the issue and banking de-
pa rtments. Mr.. Oberfohren simply ex-
poses his ignorance when he attempts
to create the contrary impression.
My critic. when he says that the
Bank of England includes In It's state
ment of cash coin and bullion. thus
including sometimes large sums OF sill
yer money the intrinsic value of which
is much less than the face value
again is guilty OF either ignorance or
| Misrepresentation. In the banks
banking department statement OF
November "a, 1919 the date used by
myself in my recent letter. there is
! an entry of f162,s6 in gold and sill
I'll. IHeIe IL Io Quiet SllNtI tItIN -
any time. In the statement of No
vember "a covering the issue depart
ment the entry is of f52.294.1s0 gold
coin and bullion" which by no dis
tortion Of the Kings English can be
held to imply gold and silver coin and
bullion"
Your correspondent writes al length
Of the banking exhibits of the English
and German central banks. AS l did
not discuss the banking assets and
liabilities. his assertions and deduc-
tons have no bearing OF my argu-
ments. In charging the British Treas
ury currency notes against the Bank
OF England | aimed to show the full
amoun of paper issues in England in
connection with the hanks total gold
cover. Similarly | charged the Ger
nan war loan notes against the
R~cichsbank to show the full amount OF
Germany's paper currency in connec'
ton with the gold held against 1t
Both classes of emergency notes mus
he redeemed ultimately in gold II the
gold standard j. to he maintained
This leads me to remark that my
critic may not he aware that to-day
Germany has suspended gold pay
ments, while the Bank Of England
notes are still redeemab!e in gold. anC
that London is still an open marke'
in which gold may he bought or solo
by all except enemy countries. .Anc
hardly "A week passes but tina thu
Bank Of England statement record.
sales Of gold to Spain. Holland ant
d - . !. ,nrf - .1a IsA,ttNart THw,.s
the United States. &c. Also. no ques
ton was involved IN my reCen com
municatton a. to the war loan note'
held in the portfolio of the HeiChsbauk
The figures used We're given out b,
the Overseas News Agency. a German
mouthpiece. and there is no reason I,
suppose, unless the agency's sta,cmen
was clums!ly or m~isieadingly made up
that the amount IT gave was not note
outstanding.
If your correspondent wants tn e
more the war loan notes in consider
ing gold ~ paper money compare
tive relations. he must exclude tn,
British Treasury currency notes also
This would leave the Bank of EnClan,
.ssue department holding 13.92 pc
N'lt' ~ Splu against KS l'NdI pdlll
note issue and the l,eichsbank hold
ing 1888 per ent Of gold against it
own note circulation. Mr.. Oher
fohren reaches his 32.S per cent. a
the gold cover Of the Bank of Englan,
by kindly a%bolishing nearly 1879 mill
IONS of dollars OF gold in it's vaults an,
charging against the bank the 43l
odd millions of Government currenc,
notes. which are not obligations of IN
bank,
Mr.. Dberfohren alriiy dismisses tn
British Chancellor of the Excheuuer'
statement ~ to the amount of gol
in circulation in Great Britain. It hap
pens, however, that Mr., Mckenna'
figures closely approximate the esti
mates OF the United States Mint. You
correspondent says that he has no tig
ures later than 1906. The annual re
port Of the Director Of the Unite
States MIN for 1915 is just published
approximate stock Of money in tn
aggregate and per capita If the prin
Cipal countries Of the world on Decem
Der 81. 1913" which is seven year
later than the statistics your CORE
spondent confeSses he Is using. 1'hes
comparisons from the mint table ar.
incidentally, of considerable intcres
tieures being given in thousands:
STOCK OF GOLD
IN banks
4 publicln Grctl Per