The Alaska daily empire., 1918-08-15
Worlds Gold Supply Controlled by Allies.
(San Francisco Examiner

(San Francisco EXamner) B. l.. Thane widely known mining engineer, n r'itten an interesting article on the gold mining 1 ustry, and the relation of gold to war financing Here are few excerpts from his article:
 The gold mining industry of the world finds itself in serious situation due to the material increased cost of labor and supplies resulting from the war, and the unique fact that the value of the product produced -gold-fiXed in price by the Government has therefore had no proportionate increase in its market value
 Last month 300 ,000 ounces of gold produced in the Rand, the most substantial producing in the world, were sold to the Govern ment at less than cost and this same condi- ton is true of several of the largest operations in Alaska, Canada and the United States.
 The of gold basis of credit and ex- change has been firmly established, and has proved universally satisfactory, that it may be positively stated that other commodity compares with gold for this particular purpose, will there be long there separate nations and governments on the face of the world.
 All balances in international trade must be paid for in some fixed and unchangeable med ium, like gold.
 Accepting gold as a basis of all credit struc- ture there has never been, in the history of the world, a time when the demand has been great as now, in order sustain reasonable reserve against the Government issue of bonds, certificates, etc.
 As has been pointed out by Henan Jennings, Consulting Engineer of the Bureau of Mines, 91 per cent. of the gold and the gold producing properties of the world are controlled by the Allies, and less than per cent. by the Central Powers.
 It is evident that if the Governments of the Allies, owning and controlling this gold source, would arbitrarily double it's value, the Central Powers would have to do twice the amount of work and sell twice the quantity of material, in order to obtain their gold supply necessary to establish proper reserve against the paper structure which has been developed by them account of the war.
 In other words the governments of the Allies could compel Germany to pay twice as much for her necessary gold supply.
 While this idea and suggestion at first sight seems radical, 1t is interesting to note that the entire gold producing industry of the British Empire called meeting for this identical pur- pose on July and appointed committee to bring the situation to the attention of the Government.
 So far the United States is concerned, the first necessity is legislation which will permit the continuation of the present gold mining industry.
 Second, the formation of an international commission to act jointly with the committee now formed in London for the purpose of re- establishing a proper fixed price for gold com mensurate with present conditions and the en- actment of such legislation as will protect all paper issues which have been made on the present gold basis
 Given the knowledge that the United States and her Allies control 91 per cent of the gold and gold producing areas of the world the questions arise:
 First. Why should We pay for supplies pur- chased from neutrals in gold at less than actual cost of production?
 Second Should not the United States and her Allies recognize this great international set and take steps to prevent Germany and the Central Powers from entering the world kets, thereby draining from the United States and her Allies, their gold to preserve the very pose of carrying on the war against us?
 Third. Why should the gold mining industry as established. be compelled to sell its product at price less than that which it is actually worth?