The Rathdrum tribune. (Rathdrum, Idaho) 1903-1963, 1923-09-07
WHO INFLATED
The CURRENCY.
George E. Roberts Gives Com
mon Sense Explanation for
Currency Increase and
Decrease.
GOVERNMENT TOOK NO PART
w. - Change In Supply, Demand
aA1 priees ct Commodities
: Caused BY War-Fsdsrat
Rsserve Not to Blame.

ne mistaken nstion that the cur.
poasy - i1Aated and debated by the
government IN the United States from
motives beyond the understanding OF
average people II effectually set at
rest by George =. Roberts, noted
banker and exponent Of sound money.
n an article In the Journal Of the
American Bankers Association.
There Has been imitation BY the
esvsfAnsats Of Germany and other
European countries. which have Is
sxsl money for the purpose Of paying
their sxpsnsss." Mr.. Roberts says.
The United States Government has
deAs nothing Of this kind since the
C1vN War.
There n Z genuine need for elias
tidty n the volume of currency, and
Ter machinery to adjust It to the legit-
tAste needs Of the country. The
means provided are the Federal Re-
eegve Banks. authorized to issue cur
renu 70 their member banks, either
Il yayAsat OF deposits or for loans.
oi6e-Traeksd Like Freight Cars
Mere currency 10 needed in Sep
taaber. October. November and De-
eeabeS than IN January and February.
- business slackens. currency nat ,
pSa1ly rstifes from circulation. Money
aoo9mu1atss in the member banks
40 they send II In to the Reserve
hanks, which In effect retires 1t, as
freight cars are retired when trafic |
tails "a
what caused the great imitation Of
credit and currency 1t was due pri-
marty to the war, which made ex-
tPaordi1ary demands upon the indus
t13as and caused great rise of wages
AID pr1csA It was inevitable that
n4ss credit and money would be
ealls4 for to carry on business.
The boom year of business that fol-
|svel shs armisice was likewise abb |
HegaAl The end Of the war released
} ODoa& May demands that had been
~ - cheek. The foreign demands
- - - 15st increased. There was
leoDoeaxy stimulus. but the volume
= husiless was abnormal and could 6
~ be sustained. Agricultural pro-
|uetion n Europe revived, the prices
( agricultural products moved back I
sward normal, importations from the !
Jnitsd States fell OF. prices declined, :
deAation" began. r
A1eme say imitation should not be '
srmittsd.' but II war occurs imitation o
unavoidable. Recruiting armies y
lakss : labor scarcity. Contractors
q shove going wages to attract men.
~ war industries did the same and I,
y De4ce industries raised wages to n
I'd their men. Governments of Eu- o.
~ seat representatives to this coun- a
: T. buy food and they bid up prices m
The grain exchanges. Higher levels tc
wages and prices meant that more b,
lit and money was required to o,
AZ business. r
Mees Dusiness, More Money to
~ iAereased issues Of currency m
= . result OF allowing business to be
ahead, upon the rising level OF tn
ees and prices. When q factory M
v-roll doubled. twice az much cur Of
icy had to be furnished for It.
lsa cotton rose from 10 cents 4 or
nd to 80 and 40. more currency tn
: required to handle the crop, and w
I'll. around the circle. an
DeAation did not come by an act th.
~ government or the Federal Re- raj
~ authorities In suddenly with ste
Wing money from circulation. De- CO,
len came naturally when business mel
o. and prices declined. Just as mil
volume OF business at