The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1921-10-19
Europe's Gold Reserves

While Europe sent to the Uni
ted States more than two huudred
and fifty million dollars in gold dur
ing the first six months Of the cur
rent year above receipts from this
country, nevertheless slight gain
occurred in that period in the total
gold reserves Of Europe held by
central banks or government
agents.
Only three of the fourteen chief
European gold holding countries
showed a dimunition in their gold
stocks from January l to July 1,
and these losses were relatively
slight, their combined total amount
ing to less than twelve million dol
lars. This loss was more than Off
set by gains among the other eleven
countries, tn enet increase OF the
fourteen combined amounting to
s1,1s9,000.
Yet between January l and July
IL, the gold stock held by federal
reserve banks in the United States
increased by s402, 100000 or near
ly 20 per cent. of the s2,059,S30,000
they held the first Of the year, al
most two-thirds Of the increase be-
ing made up by the gold from Eu-
ropean shipping points, the rest
domestic sources:
An analysis of this gold move
ment shows. that present European
gold reserves are not being drained
to swell Americas holdings but that
the increments to this country's
hoard since the first Of the year, in
so far as shipments from Euro
pean points are concerned, are
chiefly accounted for by three great
streams of the metal consisting OF
newly mined supplies from Africa
coming by way of London; Of gold
Yielded up by India, also coming
by way Of London; and Of metal
thought to have originated from
Russian sources, eventually coming
to America from various European
countries.
Europe's centralized reserves
were built up subsequent to the
outbreak Of the Great War far
above prewar figures, and We're
further increased since the Armis-
tice, by concentrating in them as
far as possible all gold privately
held. While these reserves have
been, by continued government I'M
poiundage, kept rigidly stabilized
at the points as result Of these
extraordinary war and postwar
measures, in the face Of the recent
tremendous suction Eoward Amer
lea, nevertheless the three great
streams have flowed through these
countries to the United States with
little impediment during the last,
six months. No material effort
has been made in Europe to divert
the gold from them for the purpose
of building up further the reserves
there. The gold has served to re-
duce European Indebtedness in Am
erica rather than to aid in restoring
the gold standard in Europe.
It was stated in the federal re-
serve bulletin for June, 1921, that
the director of the Swedish mint
had recently estimated that sew
enty tons. of Russian gold were re-
ceived in Sweden since 1920. He
was quoted as saying that after re-
flning it was reexported, chiefly TO
the United States. representing an
assayed value here OF about $40,-
100000. The bulletin also said
that not less than another 60,G00,-
900 of Russian gold or its equiva-
lent had fond it's way to the Uni
ter States through France and other
channels.
The movement of gold from Rus
sia to the United Sattes is not deh-
nitely traceable. It is thought to,
have come to this country indirectly
through various continental couI-
tries in addition to these mention
ed above. At the outbreak Of the
war in 1914 the Russian state bank
held s779,750.o 600 in gold; by the
end Of 1917, the date Of the last
definite statement Of gold held In
the bank, the stock had dwindled. to
s633, 100000 at has been reported
that this balance has since been
largely dispersed and the amount
remaining is unknown, but is
thought to be small.
1t appears therefore that the Uni
ted States received, between jan
uary and July 10, the equivalent
of S106,599,000 Of African and In
dian gold by way of London and the
equivalent Of more than 500, ,00e,-.
600 Of Russiuan gold by way OF
continental Europe. These three
chief sources account for the fact
that Europe as a whole has been
able 20 make substantial gold pay
ments to the United States without
further impairing her existing CEN
tralized gold stocks.
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